HHS Reveals Premiums for 36 Federally Run Exchanges
U.S. residents purchasing coverage through the Affordable Care Act's federally run health insurance exchanges will pay an average premium of $328 per month, before subsidies, for a mid-tier individual health plan, according to an HHS report released Wednesday, the AP/Sacramento Bee reports (Alonso-Zaldivar, AP/Sacramento Bee, 9/25).
The report provides the first comprehensive look at the average premium prices consumers shopping for coverage through the health insurance exchanges will pay (Somashekhar/Kliff, "Wonkblog," Washington Post, 9/25). The report included data from the 36 states in which the federal government will either run the exchange or partner with the state to do so. It also included similar data that is publicly available from the 11 states and the District of Columbia that are running their own exchanges (HHS report, 9/25).
The HHS report showed that consumers in the 36 federally run exchanges will be able to choose from an average of 53 health plans, with plans in most states offered by two or more insurers, the New York Times reports (Abelson/Pear, New York Times, 9/25). The report indicated that the number of plans available for consumers to choose from will range from six to 169 (Meyer, Modern Healthcare, 9/25).
Meanwhile, the number of insurers offering coverage will range from one in New Hampshire and West Virginia to a high of 13 in Wisconsin (New York Times, 9/25). About 95% of consumers will have at least two insurers from which to choose (AP/Sacramento Bee, 9/25).
Gary Cohen -- director of the Center for Consumer Information and Insurance Oversight -- noted that about one in four of those companies are new to the individual market. He added that premiums were generally lower in states with increased competition in their insurance markets and strong programs to review rates (New York Times, 9/25).
The report showed that the typical individual consumer will pay anywhere between $192 per month, before subsidies, for the second-lowest-cost "silver plan" in Minnesota to $516 in Wyoming (Modern Healthcare, 9/25).
Specifically, the report showed a 27-year-old with an annual income of $25,000 would pay a monthly premium of about $145 for a second-lowest-cost silver plan in most states (AP/Sacramento Bee, 9/25).
The report noted that federal subsidies would lower costs even more, and in some places would offset the entire cost of the least-expensive bronze plan (Levey, Los Angeles Times, 9/24). For example, if the 27-year-old who qualified for federal subsidies decided to purchase the lowest-cost bronze plan, he or she could see their monthly premium fall to $74 in the Dallas-Fort Worth area, $102 in Orlando and $119 in Pittsburgh, while in D.C. the subsidy would offset the entire premium (AP/Sacramento Bee, 9/25).
Meanwhile, premium prices for a family of four varied greatly, ranging from about $600 in Arizona to $1,069 in Mississippi (New York Times, 9/25). After taking federal subsidies into consideration, monthly premiums for a family of four with an annual income of $50,000 would average $282 for the second-lowest-cost silver plan. However, if the family used its subsidy to purchase the lowest-cost bronze plan, the monthly premium would be $26 in Dallas-Fort Worth, $126 in Orlando and $209 in Pittsburgh (AP/Sacramento Bee, 9/25).
In its announcement, HHS said the premium averages are about 16% lower than its own initial estimates, Reuters reports (Humer, Reuters, 9/25).
Obama administration officials touted the lower-than-expected rates, but consumer advocates and insurance experts said the findings should be viewed with caution, the New York Times reports (New York Times, 9/25).
Dan Mendelson -- president of Avalere Health -- criticized the report's "narrow" focus saying it looks only at premiums and "doesn't account for cost sharing." He added that to get a more accurate estimate of costs, consumers should add up premiums and expected out-of-pocket costs. He also cautioned that consumers should check whether their doctors and nearby hospitals are covered by the plan they eventually choose (AP/Sacramento Bee, 9/25).
Meanwhile, Larry Levitt -- a senior vice president at the Kaiser Family Foundation -- noted that the report shows "no clear political pattern to these premiums." He added, "Some conservative, anti-Obamacare states have lower-than-average premiums, and some pro-Obamacare states have higher-than-average premiums." For example, Levitt said he was "surprise[d]" by Texas' rates, saying that although the state has made efforts to block implementation, "the premiums are coming in below average" (Appleby/Galewitz, Kaiser Health News, 9/25).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.