The Nov. 17 Metro article “Where are the most expensive Obamacare plans in America? Charlottesville” called appropriate attention to the plight of families in Charlottesville looking to purchase health insurance through the federal exchange. As the article highlighted, premiums are soaring because of instability the federal government introduced as part of cost-sharing reductions for insurers and the individual mandate.
But the article inaccurately cited the rates at the University of Virginia Health System as a reason for the large premium increases. First, as the only federal-exchange provider left for Charlottesville-area residents, Optima is free to increase premiums. Residents will pay these higher premiums regardless of whether they choose to receive their care at U-Va. or at Martha Jefferson Hospital, a Charlottesville community hospital that, like Optima, is owned by Sentara Healthcare. Thus, Sentara has the opportunity to benefit from these higher premiums while paying itself as a care provider. Optima accounts for less than 1 percent of the commercially insured patients cared for at U-Va.
Data also shows that Charlottesville is not a high-cost area for medical care. A Dec. 15, 2015, New York Times article showed that of the 306 hospital referral areas nationwide, Charlottesville is the 40th lowest in medical spending per Medicare beneficiary and the 85th lowest in medical spending per commercial insurance beneficiary. Centers for Medicare and Medicaid Services data shows that the average cost per beneficiary in Charlottesville is $9,271, compared with the national average of $9,582.
There is a problem here, but it’s not Charlottesville or the U-Va. Health System.
Richard P. Shannon, Keswick, Va.
The writer is executive vice president for health affairs at the University of Virginia.