Report: Reform Law’s Health Insurer Fee To Be Passed On to Consumers
Health insurance premiums are projected to increase between 1.9% and 2.3% in 2014, as insurers pass on the cost of an annual fee mandated by the federal health reform law, according to an analysis released Wednesday by America's Health Insurance Plans, The Hill'sÂ "Healthwatch"Â reportsÂ (Pecquet, "Healthwatch," The Hill, 11/3).
The annual fee is expected to raise about $8 billion in 2014 and $14.3 billion annually by 2018, according to the Joint Committee on TaxationÂ (Bunis, CQ HealthBeat, 11/3).
The report estimates that the fee will bring in at least $73 billion by 2019 and cause premium increases between 2.8% and 3.7% by 2023. In a 10-year period starting in 2014, small group coverage policyholders will pay about an additional $2,800 for individuals and $6,800 for families, the findings suggest.
The fee is expected to affect individuals and small companies the most, the report concluded. It also will further incentivize employers to self-insure their health benefits, increase costs for Medicare Advantage and Medicare prescription drug programs, and pressure states to re-evaluate Medicaid managed care plans, the report stated ("Healthwatch," The Hill, 11/3).
Republican lawmakers have pushed back against the insurer fee.
In April, Rep. Charles Boustany (R-La.) introduced a measure (HR 1370) to repeal the fee, but the measure remains in the House Energy and Commerce Committee. Democrats are not expected to support attempts to eliminate the fee (CQ HealthBeat, 11/3).
House Democrats criticized the report, saying that insurers should cover the cost of the fee without raising prices for consumers.
Rep. Pete Stark (D-Calif.), the ranking member on the House Ways and Means Health subcommittee, said that insurers "are perfectly capable of absorbing this cost" (McCarthy, National Journal, 11/3).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.