2016 ACA Exchange Plans Have Higher Premiums, Smaller Networks

Health plans being sold through the Affordable Care Act's exchanges for the 2016 coverage year have narrower provider networks and higher premiums, according to several analyses, Modern Healthcare's "Vital Signs" reports (Herman, "Vital Signs," Modern Healthcare, 11/10).

Background

Federal officials last month released data on every health and dental plan offered in the state using the federal exchange. According to the data, average premiums for such plans will rise more in 2016 than they did in 2015. An Avalere Health analysis of the data found that the lowest-cost silver plan will increase by about 13% (Demko, Politico, 10/30).

Meanwhile, federal officials last month said premiums for the second-lowest-cost silver plans, which serve as a benchmark for calculating subsidies available under the ACA to help U.S. residents purchase coverage, will increase by an average of 7.5% (California Healthline, 10/27).

McKinsey Analysis

Further, a McKinsey analysis released last week found that:

• Premiums for the lowest-cost silver-level plans sold for 2016 will increase on average by 11%, compared with an average increase of 7% for 2015 plans; and
• Premiums for the lowest-cost bronze-level plans sold for 2016 will increase by an average of 13%.

RWJF Report

Separately, a Robert Wood Johnson Foundation report released last week found that two-thirds of PPO plans offered on the exchanges are either being scaled back or leaving the exchange in 2016. According to "Vital Signs," PPOs usually have broader provider networks. However, many insurers are adjusting or dropping PPO plans to reduce costs ("Vital Signs," Modern Healthcare, 11/10).