Premera files to drop rates again, cites lower utilization, reinsurance program

For the second year in a row, health insurance premiums on the individual market are set to get less expensive.

Premera Blue Cross Blue Shield of Alaska, the sole health insurer on the individual Affordable Care Act marketplace — where those not covered by employer-sponsored plans or public insurance like Medicaid can buy health insurance — filed a notice with the state to decrease its rates by an average of 3.9 percent.

Similarly, last year, the company filed an application with the state Division of Insurance to lower its premiums by an average of 22.4 percent, bringing down the average premium cost by more than 25 percent since 2017. According to the company, the average monthly cost has fallen from $1,043 in 2017 to $770 in 2019.

A news release from Gov. Bill Walker’s office credited the installation of the state’s Reinsurance Program for the decreases. The reinsurance program, authorized by the Legislature in 2016, fundamentally works as insurance for insurers — transferring responsibility for some of the highest-cost individuals in a risk pool to another party, which in this case is the state of Alaska.

“Reining in the high cost of healthcare in Alaska is a key priority of my administration, and this filing from Premera is yet another sign that we are making progress,” Walker said in the release. “Tens of thousands of Alaskans will save money because of this innovative policy. This is especially remarkable because, at the same time our costs were dropping dramatically, other states have endured double-digit increases.”

The reinsurance program is certainly a factor in the decreases year over year, though Premera has also seen fewer claims, said spokesperson Dani Chung.

“As far as the lower utilization last year, it was actually a 10-year low,” she said. “I can’t really speculate as to why. People are just using less.”

Alaska’s individual insurance market is very small compared to other states, with just 16,637 members as of May 2018. By comparison, more than 207,765 people were enrolled in Alaska’s Medicaid program as of May, according to the Centers for Medicare and Medicaid Services.

Because the market is so small, it fluctuates as people come and go. Jim Grazko, the president and general manger of Premera’s Alaska office, cited the turnover as one of the reasons the Alaska individual insurance market is hard to predict.

“While I am hopeful rates can continue to stabilize, it is important to note that the Alaska market remains difficult to predict due to its small size and the fact that more than 30 percent of individual market participants enter and leave the individual market each year,” Grazko said in a company news release.

Most people in Alaska qualify for federal subsidies to help with premium costs on the insurance market under the Affordable Care Act. Alaska has some of the highest health care costs in the country.

Reach Elizabeth Earl at

More in News

Mary Peltola responds to a question during a forum at the Kenai Visitor Center on Aug. 3, 2022, in Kenai, Alaska. With less than two weeks to go before Alaska’s Aug. 16 election, the three candidates seeking to temporarily replace Congressman Don Young in Alaska’s U.S. House seat have made clear their positions on abortion. (Peninsula Clarion/Jake Dye)
Here’s where Alaska’s U.S. House candidates stand on access to abortion

Palin and Begich oppose congressional efforts to guarantee abortion rights, Peltola supports abortion access

The Sterling Highway crosses the Kenai River near the Russian River Campground on March 15, 2020, near Cooper Landing, Alaska. (Jeff Helminiak/Peninsula Clarion)
Russian River Campground to be closed until June 2023 beginning next week

Resurfacing and reinforcement work will occur along about 1 mile of the Russian River Campground Road

Alaska State Troopers logo.
Hikers rescued near Cooper Landing

They became trapped in a steep ravine after taking a canoe over Kenai Lake and climbing a mountain, troopers say

Vials of empty monkeypox vaccines sit at a table at Seattle Central College in Seattle, Saturday, Aug. 6, 2022. (Daniel Kim/The Seattle Times via AP)
State announces two-tiered system for monkeypox vaccine

Due to low availability, the monkeypox vaccine is administered only in response to potential exposure

Rep. Ben Carpenter, R-Nikiski, leads an informational town hall about ranked choice voting inside the Betty J. Glick Assembly Chambers on Thursday, Aug. 4, 2022 in Soldotna, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Carpenter holds forum on ranked choice voting

Don’t “overthink it,” representative says

Raymond Bradbury preserves his salmon while dipnetting in the mouth of the Kenai River on Saturday, July 10, 2021. (Camille Botello / Peninsula Clarion)
Kenai River dipnetting closed; Kasilof to close Sunday

The Kasilof River dipnet fishery is reportedly slow, but fish are being caught

Silver salmon hang in the Seward Boat Harbor during the 2018 Seward Silver Salmon Derby. (Photo courtesy of Seward Chamber of Commerce)
Seward Silver Salmon derby runs Aug. 13-21

Last year’s derby featured 1,800 contestants competing across eight days

Rayna Reynolds tends to her cow at the 4-H Agriculture Expo in Soldotna, Alaska on Aug. 5, 2022. (Jake Dye/Peninsula Clarion)
Animals take the stage at 4-H expo

Contestants were judged on the quality of the animal or showmanship of the handler

Emily Matthews and Andy Kowalczyk pose outside the Center for Alaskan Coastal Studies headquarters on Friday, July 29, 2022, in Homer, Alaska. (Photo by Charlie Menke/Homer News)
AmeriCorps volunteers aid Center for Alaskan Coastal Studies

The 10-month commitment pushed them outside of comfort zones

Most Read