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HELENA – Health insurers selling individual policies on Montana’s Internet “marketplace” are reporting substantial losses for last year – and saying rate increases on marketplace policies are likely in store for next year.

Health insurance companies had to guess at the cost of this new market, and it appears they guessed low, leading to losses in 2014.

“You’re shooting in the dark on your rates; you really don’t know,” said Jerry Dworak, CEO of the Montana Health Co-op. “You try to guess at what that rate will be, when you do that underwriting. ... And you try to be aggressive, to get some (customers).”

“We made a deliberate attempt to expand access to coverage across all lines of our business, and as expected, it impacted our earnings in the short term in 2014, as compared to prior years,” added John Doran, spokesman for Blue Cross and Blue Shield of Montana.

Blue Cross’ parent company, Health Care Service Corp., reported losses of $282 million for 2014 – almost $1 billion less than its $684 million net gain for the previous year.

Blue Cross, the co-op and two other companies are now filing rates for next year’s policies in Montana. Those rates haven’t been made final or reviewed yet by Montana’s insurance regulator, state Auditor Monica Lindeen, but insurance officials said they’ve asked for increases.

Lindeen said Friday her office has just begun reviewing the 2016 rates. She’ll likely object to parts of the increases, and it’s possible insurers are overestimating some expected costs or other factors, she said.

“There are a lot of different issues on why these rate increases may be so high,” Lindeen said. “We’re hoping through our process we can decrease the increases.”

The marketplace is where individuals started buying subsidized health insurance policies in late 2013, as part of the federal Affordable Care Act, also known as “Obamacare.”

Consumers can shop for policies and, in most cases, get a federal subsidy to help pay for them, if they earn less than 400 percent of the federal poverty level.

However, insurance companies couldn’t refuse anyone who wanted to buy or use “pre-existing health conditions” to adjust the price for any consumer.

Insurers said Friday that costs for their new customers came in higher than expected in 2014, with drug prices and high-cost single patients leading the way in large, unanticipated costs.

“What we’re seeing across the country is that nearly all health insurers, large and small, are losing money in the individual marketplace,” said Todd Lovshin, vice president and Montana regional director for PacificSource, another seller on Montana’s marketplace.

PacificSource, headquartered in Springfield, Oregon, reported a fairly moderate loss of about $17 million last year. It serves about 275,000 customers on commercial insurance, Medicare plans and managed Medicaid plans.

In Montana, PacificSource has about 30,000 customers, not all of whom bought on the marketplace.

The Montana Health Co-op, a new nonprofit insurer, lost about $4 million last year on $30 million worth of business, Dworak said. The co-op insures about 25,000 people in Montana and another 19,000 in Idaho.

Figures for Assurant, the fourth company selling on the marketplace, weren’t available.

Doran said Blue Cross in Montana expanded its customer base last year to about 255,000, up from 236,000 the previous year, and expects the market to stabilize over time.

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