Premium Increases To Be Modest in Most Areas in 2015, Report Says

Premiums for exchange plans will either decline or increase by 5% or less in most areas, though rural areas will face higher increases, according to an Urban Institute study released Thursday, The Hill reports (Ferris, The Hill, 11/6).

Researchers examined average premiums for the lowest-cost silver plans available on the Affordable Care Act's insurance exchanges. They compared 2014 prices with 2015 prices in 39 rating regions across 17 states and Washington, D.C. (Reichard, CQ HealthBeat, 11/6).

Researchers found that average premiums in 2015 will:

• Decrease in six states;
• Increase by 5% or less in 10 states; and
• Increase by more than 5% in two states.

Across the 39 rating regions, average premiums in 2015 will:

• Decrease in 18 regions;
• Increase by 5% or less in 11 regions; and
• Increase by more than 5% in 10 regions ("Taking Note," New York Times, 11/6).

The researchers said the findings show the ACA is curbing costs. John Holahan, a health policy fellow at the Urban Institute who co-authored the report, said the results are "a good outcome, of at least one aspect of the" ACA, adding that "[w]hat it intended to do seems to be working" (The Hill, 11/6).

Study Finds Urban, Rural Divide

Although most rating areas will see average premiums decline or only increase slightly, the study found that rural areas were more likely than urban areas to see larger average increases.

In the rural counties examined, the study found that average premiums will increase by:

• 21.4% in Tennessee counties;
• 9% in West Virginia counties;
• 7.9% in New York counties; and
• 6.7% in Michigan countries.

In comparison, major cities such as Baltimore, Cincinnati, Cleveland, Denver, Detroit, Minneapolis, New York City, Portland, Ore. and Seattle and Washington, D.C, will experience decreases or small increases (CQ HealthBeat, 11/6).

Uncertainty Remains Going Into 2016

The study warned that "significant uncertainties" remain about premiums rates going forward. However, Holahan said companies that increase premiums will risk losing customers as the market grows. As a result, he said he doubts companies would significantly increase premiums, noting more insurers are entering the exchanges and are "setting premiums fairly aggressively" (The Hill, 11/6).