2027 Rate Changes - Alaska: +22.9% indy mkt; +17.4% sm. group

Mon, 08/03/2026 - 10:47am

ACA exchange enrollment has dropped significantly in Alaska since Congressional Republicans allowed the enhanced federal subsidies to expire at the end of last year.

Initial signups during Open Enrollment were already down 9.2% vs. OEP 2025...but effectuated enrollment as of January 2026 was down over 12% year over year...increasing to a 13% drop as of February.

The good news, such as it is, is that due to Alaska having such a small ACA population to begin with, this only amounts to around 3,400 people losing coverage...which is small comfort if you're one of those 3,400 people, of course:

Here's what this looks like visually, with both 2025 and 2019 (the last pre-COVID year, which didn't include the enhanced subsidies) included for comparison:

Looking ahead to 2027, the preliminary rate filings for both the individual and small group markets are now available via the federal Rate Review database:

MODA HEALTH PLAN:

For January 1, 2027 through December 31, 2027 effective dates, the average rate change is 9.30%, the maximum is 15.58%, and the minimum is 5.36%. The number of individuals impacted by this rate change is 5,106.

Most Significant Factors

Moda’s 2025 Alaska Individual experience was determined to be fully credible based on having 79,029 member months in the experience period and needing 65,000 member months to be fully credible. The most significant factor contributing to the increase is Moda Health Plan’s emerging Alaska Individual experience and a 9.7% annual trend. Based on 2025 results, the reinsurance receivable is projected to be a lower offset to claims and the risk adjustment payable is projected to be a higher addition to claims compared to the assumptions that were used in the 2026 rate filing.

The experience period used to develop the rates for this rate filing was January 1, 2025 through December 31, 2025. 24 months of trend were then used to project forward to the January 1, 2027 effective date. Other factors include age, geographic area, morbidity, risk adjustment, and reinsurance changes.

The 2027 rates are made up of the following components:

Claims: 89.03%

Administrative costs (including commissions): 5.96%

Taxes and fees: 3.01%

Contribution to surplus, profit, and risk margin: 2.00%

PREMERA BCBS OF AK:

Premera Blue Cross Blue Shield of Alaska (PBCBSA) is renewing all eight existing metallic plans. All plans will be sold on the Federally Facilitated Exchange.

Scope and range of the rate increase:

Premera currently has 18,561 members on metallic plans.

The average rate increase for 2027 is 26.7%, with plan-level increases ranging from 24.8% to 29.9%. The increase is primarily driven by medical and pharmacy cost inflation, higher utilization, and claims experience that is more adverse than assumed in current rates. Three years of financial results, along with the estimated current year, are provided at the end of this document. In 2025, Premera reported a profit of $19,284,484 for this block but projects a loss in 2026.

The primary contributors to the rate increase are a 9.1% med/Rx claims trend and a 12.1% demographic adjustment for members who renew or purchase coverage with Premera. This demographic adjustment reflects reduced membership following the expiration of enhanced subsidies. Members with lower utilization are more price sensitive, resulting in a renewing pool with higher overall utilization.

Changes in benefits:

To meet compliance with the actuarial value, Premera is changing member cost shares in 2027. The Preferred Gold and Alaska One Gold’s deductible increased from $1,500 to $2,000, out-of-pocket maximum increased from $6,350 to $7,000 and primary care office visit copay decreased from $30 to $25; the Standard Gold’s non-preferred brand and specialty cost shares changes to deductible then 50% or 40%; the Preferred Silver’s deductible increased from $4,500 to $5,000 and OOPM increased from $8,100 to $8,900, primary care office visit increased to $30 copay, and specialist office visit copay increased to $65; the Standard Silver’s non-preferred brand and specialty cost shares changes to deductible then 50% or 40%; the Preferred Bronze HSA’s increased the OOPM from $8,000 to $8,500; the Preferred Bronze’s deductible increased from $6,350 to $7,000 and OOPM increased from $8,700 to $10,000; the Standard Bronze’s deductible increased from $7,500 to $7,750.These changes impact the costs by -0.9%.

Changes in Medical Service Costs:

For Premera’s individual metallic business, the annual medical and pharmacy services cost inflation is expected to be 4.7% with an additional increase in utilization of services of 4.1% per annum.

Administrative costs and anticipated profits:

Premera is committed to using members’ premium dollars responsibly and directing a high percentage of premium revenue to medical claims. For this line of business, Premera expects to exceed the ACA’s required Medical Loss Ratio (MLR) in 2027.

Taxes and fees, including fees paid toward the Federally Facilitated Exchange, account for 4.1% of premium.

The other administrative costs (Administrative Expense Load) account for 6.8% of premium which is 0.7% reduction from the prior year.

Given the continued volatility and risk in the individual market, the premium includes a 3.0% contingency and risk charge.

Financial experience of the product:

The following section summarizes the financial performance of this line of business for the past three years and includes an estimate for the current year. Experience, including membership, revenue, and claims, has been restated since the Annual Statement to reflect updated information, such as revenue earned and claims incurred during the year but paid in subsequent years. Earned premium includes revenue ceded to the Alaska Reinsurance Program (ARP) and therefore not retained by Premera. In contrast, reported revenue excludes ceded premium and includes non-premium revenue, such as Risk Adjustment transfers. Similarly, incurred claims include claims ceded to the ARP, while total benefit expense excludes reinsurance. The 2023 and 2024 results include the final ARP net reinsurance and risk adjustment after the recalculation by the ARP. Because the net reinsurance for 2025 is not yet known, an estimate has been included. Premera also estimated claims, reinsurance, and risk adjustment for the current year since 2026 reporting is not complete.

In 2025 Premera reported a profit in operating income of $19,284,484 as shown below. However, in 2026 we are projecting an operating income loss.

...Based on the rate increase in this filing, Premera expects to earn 3.0% operating income in 2027.

Combined, this amounts to a further 22.9% weighted average rate increase for unsubsidized enrollees, pushing the average per enrollee up to a whopping $1,282 per MONTH.