A Michigan insurance company has taken a giant gamble on the health of the state’s residents by offering private health insurance.
The company, Anthem, is hoping to make up some of the lost money by offering a cheaper version of its popular Medicare Advantage program.
The state has the third-highest per-capita spending in the country for Medicare Advantage.
Anthem’s plan would cost the state $1,900 per year for a single person with an annual income of $85,000, according to the company.
If Anthem is successful in getting people to sign up for the new health insurance plan, the average monthly premium would go down from $5,800 to $3,200.
Anthem plans to pay its first year’s premium for a full-time employee at a rate of $1.85 million per year.
Anthem says its plan is an effective way to lower costs, particularly for the younger, healthy enrollees who make up the bulk of the market.
Anthem said its plan would be available by January 2019, the same date the state is scheduled to start the next phase of enrollment in Medicare Advantage, or MAA.
Anthem would continue to offer its private plans through 2019.
The new plan comes at a time when health care costs in Michigan are expected to rise rapidly.
According to a new report from the Commonwealth Fund, the cost of care for a Medicare-eligible patient in Michigan rose by 17% between the end of 2017 and 2021, as the cost for the state to treat Medicare enrollees increased by 20% over the same period.
In the first six months of 2018, the annual cost for an enrollee enrolled in MAA increased by 50% over 2017.
The report said that while the number of people who would qualify for MAA would continue rising, many of them would not qualify because they had Medicare or Medicaid coverage and were not receiving other federal subsidies to help pay for their care.
“The federal government is paying the bulk [of the cost] for Medicaid,” said Robert J. Cialdini, director of health policy at the Commonwealth Trust, a nonprofit health care trust.
“Medicare is a private program, so it’s paying the lion’s share of the cost.
And it’s not getting a return on its investment.
So the public is getting a big hit.”
The report did not give a figure for how many people Anthem expects to enroll in the new MAA plan, but the company said that the average MAA enrollee would pay an additional $2,100 per year in premiums.
That would put the cost per enrollee at $4,600, or about 20% higher than the current MAA premium.
Anthem declined to say how many enrollees it expects to sign-up for its new health plan.
In a statement to Ars, Anthem said that it has invested in the Michigan health care system to improve care for all people.
“We have seen tremendous growth in enrollment in our MAA Advantage plans over the past few years,” the company wrote.
“As we’ve made the transition to MAA, we’ve seen a marked improvement in the quality and timeliness of our care and we are seeing greater savings for the benefit of the people of Michigan.”
The Michigan Insurance Department is not a public entity, and Anthem does not have to report how many of its enrollees are insured in the state.
Anthem has previously said that more than 300,000 Michigan residents have enrolled in its Medicare Advantage plans.