Fear of premium hikes comes with good reason. As those looking to renew their health plans from the Federal Healthcare Insurance Marketplace Exchange (Federal Exchange) under the Affordable Care Act for 2017 face increases in premiums, a question of how much is posed, especially from state-to-state, as insurance companies like UnitedHealthcare and Aetna have withdrawn from many the Federal Exchange in certain areas, with many other spiking premiums in other areas to make up for losses they incurred through ACA mandates.
It would seem a cause for concern as the aim of the ACA was to provide affordable health care, and how affordable can it be with escalating premiums? However, those premiums might not affect you as much as you think.
In an article posted by Modern Healthcare, stats prove that from state-to-state, Marketplace shoppers are not in upcharge jeopardy.
The fourth open enrollment on the Federal Exchange for health insurance took effect on November 1, and will remain for the next three months. In the recently released report from the Department of Health and Human Services (HHS), double-digit premium bumps are on the horizon for 2017, with an average of a $60 increase (from $242 to $302) coming into effect.
Using a silver plan, with a 27-year-old pre-premium tax credit (PTC) as the benchmark, that’s around a 25% increase. This is for plans in the Federal Exchange. On State Exchanges, the numbers vary widely.
While the HHS did not include information on State Exchanges, they did find from a few available states that the average increase is 22%. Modern Healthcare further reports that information from available States Exchanges displays a variety of rate changes. Arizona is on the highest end at 116% increase, with Oklahoma at 69% and Tennessee at 63%. Nominal increases (or even decreases) are projected in states like Indiana, Ohio, and Arkansas. Some will not be affected at all.
The silver lining for many comes in the form of Premium Tax Credits (PTC) and other subsidies, which will alleviate many of the bumps individuals may endure. Another key aspect is smart shopping within the exchanges. Several affordable plans are available, but you’ll have to earn it with required research.
The HHS projects 77% of return customers to the Federal Exchange can find these plans to keep within their respective budgets, and 78% of the previously uninsured will more than likely take advantage of subsidies due to income requirements.
So while no increase is ever a welcomed increase, chances are your healthcare options on the applicable Exchange may not be affected and remain cost-effective.