The Mississippi Health Insurance Marketplace - What Happens When uninsured individuals move to the state?

As the nation braces for its upcoming annual open enrollment period, the Mississippi health insurance marketplace remains anything but stable. At the beginning of this year, insurers could barely cover claims and the carriers were scrambling to avoid huge financial losses. According to one industry source, this is the worst situation that has been seen in over two decades. There are many reasons why the marketplace is so unstable, and these include hurricanes, economic slowdowns, natural disasters, health reform legislation, software glitches and much more.

The Mississippi health insurance market has been especially hard hit by Hurricanes Katrina and Rita. Thousands of people lost their life savings and businesses were literally destroyed. Even after the emergency was over, there were a number of lawsuits stemming from the hurricanes. The delays and increased premiums associated with health insurance caused by these issues will take time to recover from. In fact, insurers have already reported some losses in the wake of Hurricane Katrina.

According to an estimate, as much as half the projected increase in health insurance rates have so far not materialized. The health insurance marketplace in Mississippi is considered to be stable, though. According to Steve Thompson, CEO of Tri State Insurance, "The Gulf Coast has definitely been impacted, but the Mississippi market is much more resilient. We expect rates to normalize from here."

Health insurance prices in the Mississippi health insurance marketplace are likely to increase because of the hurricane impact, but it will take time for the insurance companies to fully recover. One silver lining in all of this is that competition is increasing. It's good for consumers and it also helps keep premiums lower. If you currently don't have health insurance, you may want to examine your options.

In terms of coverage, many residents in the Mississippi health insurance marketplace are covered for catastrophic medical events like heart attacks, cancer, accidents and some prescription drugs. There are a few problems with these plans, however. First, they do not cover pre-existing conditions which means if you're in poor health right now, you may need to get yourself covered now.

The second major issue affecting the Mississippi health insurance marketplace is the fact that premiums could rise at anytime. "There's really not a lot of time to figure it out," said Thompson. He notes that if the health insurance rate increases by one percent, it would cost an extra $400 per year. This could be a big surprise to residents in the Mississippi Delta who were already struggling to pay for high-priced health care.

What's more, the health insurance marketplace in Mississippi could face a significant shakeup as some insurers to pull out of the state altogether. Humana has already said it's considering its move to Maryland. NissanCarInsurance of the reasons for this move? "The costs in the Mississippi market made us consider moving our health insurance operations south of here," said Karen Woods, a Humana spokesperson. The potential departure of insurers could result in premiums jumping in the next few years in Mississippi. "There's only so much room to grow," she added.

If Humana is the first insurer to pull out of the Mississippi health insurance marketplace, what does this mean for residents here? Thompson says it's still too early to tell, but he warns that it could have long term implications for the state's health insurance marketplace. "If every health insurance company leaves the state, you'll have fewer choices for coverage," he said. "But if two or more companies leave, you'll have even fewer options."

In addition, Mississippi does have one other major issue on its side: a major prescription drug initiative. A recent study by the Kaiser Family Foundation found that one in three Mississippi adults without health insurance did not know that the state had created a prescription drug coverage that's available to low and middle-income families. "You can buy into the program without visiting your doctor," explains Kaiser Senior Advisor Larry Waplinger. "And just 15% of the uninsured actually uses it." Because of this, says Waplinger, "a lot of people in the Mississippi health insurance market will either be under-insured or over-insured."

That's bad news for the state's already strained health insurance budget. "When you've got less income and a lot more medical bills, health insurance is becoming a big burden," admits Thompson. "That's why the federal health programs are so attractive in the first place - they're so efficient at providing the care most of us can't afford on our own." But if the state doesn't start improving the health insurance marketplace in Mississippi, "the federal government will probably step in to make some money on the deal," says Waplinger.

So, what's a consumer to do? According to Thompson, the best thing a person can do is "get as many quotes as possible" and compare them. "The simplest way to do that is with an online site," he says. "Just fill out a form about your medical history and then give some specific details about your family's health." By doing so, "you'll have a much better idea of how much your premiums are going to be - and whether you can afford them," he explains.