For the second year in a row, health insurance premiums on the individual market are set to get less expensive.

Premera Blue Cross Blue Shield of Alaska, the sole health insurer on the individual Affordable Care Act marketplace — where those not covered by employer-sponsored plans or public insurance like Medicaid can buy health insurance — filed a notice with the state to decrease its rates by an average of 3.9 percent.

Similarly, last year, the company filed an application with the state Division of Insurance to lower its premiums by an average of 22.4 percent, bringing down the average premium cost by more than 25 percent since 2017. According to the company, the average monthly cost has fallen from $1,043 in 2017 to $770 in 2019.

A news release from Gov. Bill Walker’s office credited the installation of the state’s Reinsurance Program for the decreases. The reinsurance program, authorized by the Legislature in 2016, fundamentally works as insurance for insurers — transferring responsibility for some of the highest-cost individuals in a risk pool to another party, which in this case is the state of Alaska.

“Reining in the high cost of healthcare in Alaska is a key priority of my administration, and this filing from Premera is yet another sign that we are making progress,” Walker said in the release. “Tens of thousands of Alaskans will save money because of this innovative policy. This is especially remarkable because, at the same time our costs were dropping dramatically, other states have endured double-digit increases.”

The reinsurance program is certainly a factor in the decreases year over year, though Premera has also seen fewer claims, said spokesperson Dani Chung.

“As far as the lower utilization last year, it was actually a 10-year low,” she said. “I can’t really speculate as to why. People are just using less.”

Alaska’s individual insurance market is very small compared to other states, with just 16,637 members as of May 2018. By comparison, more than 207,765 people were enrolled in Alaska’s Medicaid program as of May, according to the Centers for Medicare and Medicaid Services.

Because the market is so small, it fluctuates as people come and go. Jim Grazko, the president and general manger of Premera’s Alaska office, cited the turnover as one of the reasons the Alaska individual insurance market is hard to predict.

“While I am hopeful rates can continue to stabilize, it is important to note that the Alaska market remains difficult to predict due to its small size and the fact that more than 30 percent of individual market participants enter and leave the individual market each year,” Grazko said in a company news release.

Most people in Alaska qualify for federal subsidies to help with premium costs on the insurance market under the Affordable Care Act. Alaska has some of the highest health care costs in the country.

Reach Elizabeth Earl at eearl@peninsulaclarion.com.