Oct 26, 2016 | By Jack Craver
Premiums are
definitely going up for health plans sold through the Affordable Care Act
individual marketplace.
However, most ACA customers will not see
the types of double-digit hikes that have garnered headlines and served as a
cri de guerre for ACA opponents in the last weeks of the 2016 election
campaign.
Instead, it
appears that a minority of ACA customers will be subject to high premium
increases, while the majority will see only a modest rate hike.
For starters,
the widely-publicized estimate from the Department of Health and Human Services
that ACA plans will increase by an average of 25 percent is
based specifically on what it would cost a 27-year-old to buy the second
cheapest silver-level plan through the marketplace, before tax credits.
As ACA premiums
rise, said Aetna CEO Mark Bertolini, young people will choose beer over health
insurance.
The price for
that benchmark plan will increase by an eye-popping 116 percent in Arizona, 69
percent in Oklahoma and 63 percent in Tennessee. However, in a number of other
states, the premiums will go up only slightly. In a couple of states they will
even decrease.
Many states
that are seeing the biggest increases also had some of the lowest premiums,
including Arizona, Tennessee and Minnesota, Cynthia Cox of the Kaiser Family
Foundation told Modern Healthcare.
Another
widely-neglected point is that it’s not always customers who will be bearing
the brunt of the major premium hikes. Seventy-seven percent of marketplace
customers qualify for subsidies, either in the form of tax credits that offset
the cost of their plan or, in the case of those with the lowest incomes,
cost-sharing subsidies that lower the price of their premium.
As a result,
HHS estimates, roughly 77 percent of ACA customers can find a plan that costs
them less than $100 a month and 72 percent could find one for less than
$75.
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