CMS: Exchange Plan Premiums Will Rise for Some Current Enrollees
Some health plans purchased through the federal health insurance exchange for 2015 will have higher premiums than they did in 2014, according to data released by the Obama administration on Friday, the New York Times reports (Pear et al., New York Times, 11/14).
The data included information on premium costs, cost-sharing requirements, provider networks and other relevant data for plans being sold on HealthCare.gov for 2015. Specifically, the data have the approved health plan rates and premiums for more than 150,000 small-group and individual health plans throughout 34 states (Herman, Modern Healthcare, 11/14). The data were released about 12 hours before the ACA's second open enrollment period launched on Nov. 15 (Keating/Millman, Washington Post, 11/15).
Premium Increases Vary by Plan, Location, Data Show
The data found that many U.S. residents will see premium increases for exchange plans they purchased last year, with some increases as high as 20%. For example, a 40-year-old living in Nashville, Tenn., who purchased the least-expensive silver level plan for 2014 currently has a monthly premium of about $181, but he or she will have to pay about $220 each month to keep that plan for 2015. According to the Times, the least costly mid-level plan in that area is now offered by a different insurer and has a monthly premium of around $194 (New York Times, 11/14).
According to a Washington Post analysis, the data found that about 25 states using HealthCare.gov for enrollment on average are selling plans with higher premiums this year, while nine states are boasting lower-average premiums (Washington Post, 11/15).
Meanwhile, a Times analysis of the data found that premiums increased the most in areas where few insurers competed on the market. For example, prices for the lowest-cost silver-level plans increased by at least 5% in 89% of the counties that had only one insurer, and roughly 25% of counties with one or two insurers saw at least a 10% rate increase.
However, the Times analysis also determined that consumers might be able to find other health plans with premiums similar to those they are currently paying depending on their state and county.
Specifically, the data show that if consumers are willing to switch health plans, they could see moderate premium increases, typically between 4% to 5% for silver level plans (New York Times, 11/14). By contrast, consumers automatically re-enrolled in coverage they purchased last year will face average premium increases of 7%, or around $34 each month, according to the Post (Washington Post, 11/15).
Meanwhile, CMS also said Friday that the number of health insurance companies selling plans through the ACA's exchanges increased by 25% since last year (New York Times, 11/14). Further, more than 90% of people will have a choice of at least three insurers, compared to 75% in 2013 (Washington Post, 11/15).
Reaction
CMS Administrator Marilyn Tavenner said individuals should "shop around" for health plan in the exchanges because "[w]ith new options available this year, they're likely to find a better deal." She added that the changes show "the [ACA] is working" (New York Times, 11/14).
Ceci Connolly, managing director of PricewaterhouseCooper's Health Research Institute, said, "There seems to be a good indication that a robust rate review process does appear to reduce premium increases." She added that increased number of insurers participating in the exchanges "is confirmation that the health insurance industry sees the new ACA exchanges as a business opportunity and business worth pursuing" (Modern Healthcare, 11/14).
Separately, Sen. Orrin Hatch (R-Utah) said, "Last year, many who liked their plan were surprised to learn they couldn't keep it. This year, many who like their plan will likely have to pay more to keep it."
Meanwhile, experts said that such price variances will likely continue, the Times reports. Avalere Health Vice President Caroline Pearson said, "Next year will see another reshuffling," but noted that in about "a year or two," the health insurance market "will start to stabilize" (New York Times, 11/14).
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