Avalere: Exchange Enrollees Could Face Higher Premiums in 2015
Many U.S. residents enrolled in health coverage through the Affordable Care Act's insurance exchanges might have to pay substantially higher premiums in 2015 if they do not switch plans during the upcoming open enrollment period, according to a report released Thursday by Avalere Health, Kaiser Health News' "Capsules" reports.
For the analysis, Avalere researchers examined preliminary rate filings in nine states:
- Rhode Island;
- Virginia; and
- Washington (Appleby, "Capsules," Kaiser Health News, 6/26).
Specifically, they focused on how changes in premiums tied to the second lowest-cost silver plan -- which federal premium subsidies are based off of -- from 2014 to 2015 would affect enrollees' out-of-pocket costs (McIntyre, Vox, 6/26).
Consumers who select exchange plans that cost less than a silver plan -- or the "benchmark" plan -- in 2014 pay less after tax subsidies are considered, while consumers who select higher cost options pay more. The plan that is designated the benchmark for subsidies will change from year to year, affecting monthly premiums (Appleby, "Capsules," Kaiser Health News, 6/26).
Two-thirds of exchange enrollees in the nine states who enrolled in silver plans in 2014 chose one of the two lowest-cost options, according to Avalere Vice President Caroline Pearson (Vox, 6/26).
Pearson also noted that the range in premium prices widened from 2014 to 2015, in part because new insurers entered the exchanges with lower rates in an attempt to gain more market share. Meanwhile, other insurers that significantly increased their market share in 2014 raised their rates in 2015 ("Capsules," Kaiser Health News, 6/26).
Avalere researchers also noted that the second-lowest cost silver plan would lose benchmark status in six of the nine states next year, while the lowest-cost silver plan in seven of the nine states would no longer be the lowest-cost option in those states next year.
As a result, consumers who do not shop around for lower-cost plans would end up facing substantial after-subsidy premium increases in 2015 (Howell, Washington Times, 6/26).
HHS Issues Enrollee Notification Regulation
Meanwhile, HHS proposed a directive Thursday that would require insurers to notify enrollees of their new expected monthly premiums prior to coverage renewals (Vox, 6/26).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.