Basic Health Plan premiums to rise sharply

Premiums for Washington's Basic Health Plan will as much as double in January as part of a strategy to drive thousands of members off the popular but cash-strapped state-subsidized insurance program.

Ending weeks of deliberations, officials announced this morning that they will boost Basic Health's rates by an average of 70 percent as part of their effort to boot 30,000 to 40,000 working-class people off its rolls.

Officials rejected four other potential options on how to shrink the 100,000-member pool, including a lottery and ejecting members based on how long they'd been on the program.

In the end, officials punted on the dilemma, leaving it up to the members themselves to decide whether to stay or to leave.

"This is the best possible option out of difficult choices," said Preston Cody, deputy administrator of Washington State Health Care Authority, the agency that operates Basic Health.

Currently, Basic Health's premiums range from $17 to $281 a month, depending on the member's age, income and county of residence. Starting in January, the poorest members with incomes below the poverty level will pay twice as much, $34 or $45.

Rates for higher-income enrollees will go up by about 50 percent, to about $400 a month for those 55 and older. This will be the biggest premium increase in the program's 21-year history.

In all, the average monthly premium for all members will climb to $61.60 from $36. Yet even with the increases, the average person will still will be paying only 25 percent of the actual cost of coverage, with the state chipping in the rest.

The annual deductible will rise from $150 to $250.

Because of the recession, the Legislature axed $255 million, or 43 percent, of Basic Health's budget for 2009-2011. That will leave enough money for an estimated 64,000 slots; Basic Health officials have said that the pool needs at least 60,000 people to remain viable.

Advocates for the poor warned that even $17 a month will pose real hardship for people who already are living on little. More than half of the people on Basic Health have an income below the federal poverty level, or $10,830 a year for a single person and $18,310 for a family of three.

Still, the state "chose the lesser of many evils," said Rebecca Kavoussi, director of public policy for Community Health Network of Washington, a network of nonprofit community-health centers.

Sen. Karen Keiser, D-Kent, applauded Basic Health officials for adopting "pretty obvious" changes before resorting to premiums increases. They include verifying members' incomes more closely and dropping members who also qualify for Medicaid. The state also plans to impose an asset test for eligibility, most likely a limit on the amount of money in personal savings accounts.

But Keiser worried that the big rise in premiums will drive away too many people, possibly imperiling the pool. Basic Health officials dispute that concern, noting that 30,000 people are lined up on a waiting list.

Kyung Song: 206-464-2423 or ksong@seattletimes.com