Consumers in most of the geographic areas studied will be able to obtain 2015 silver-level health plan coverage at lower rates than were available in 2014 or at premium increases of less than 5 percent found a new study by the Urban Institute.
Observers had been concerned that large premium increases might kick in for year two of the ACA health insurance marketplace experience.
Often the researchers found that a different carrier from the 2014 health plan is offering the lowest priced silver option in a rating area for 2015.
The ACA’s incentives, centered on the silver plan premiums in an area, the study report said, resulted in “healthy competition over rates in many markets in 2014, particularly in urban areas. Markets generally saw a large number of competing carriers offering several plans.”
The Urban Institute report said national commercial plans, “particularly Blue Cross Blue Shield (BCBS) plans, as well as local carriers, entered the health insurance marketplaces in 2014.”
Plans previously providing coverage only for Medicaid beneficiaries and cooperatives also entered the marketplaces in a number of areas, the researchers said. “As a result of competition, premiums were surprisingly modest in many areas, particularly in comparison with benchmarks such as small group market premiums.”
The study analyzed non-group marketplace plans. “We focus on 17 states and the District of Columbia, which were the first to complete their rate review and approval processes,” the researchers said.
Overall, the study found that:
- Six states will have average premium reductions across the carriers’ lowest cost silver plans;
- 10 will have small premium increases (defined as 5% or less); and,
- Two will have increases greater than 5 percent.
Across the 39 rating regions studied within those states,
- 18 will have average percentage premium reductions across their carriers’ lowest cost silver plans;
- 11 will have small increases; and,
- 10 will have larger increases (greater than 5%).
Among the states studied Colorado will have a -10.9 percent change in the lowest cost silver plan available in the marketplace, according to the report.
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However, Tennessee will see a more than 18 percent increase in 2015, said the report.
The study focuses exclusively on comparing each carrier’s lowest cost silver marketplace plan premium for a 40-year-old in chosen rating areas within 17 states and the District of Columbia in 2014 and 2015, researchers said.
Some caution should be observed “when evaluating the predictive power of 2015 premium changes for future years because those markets remain in transition in a number of respects,” the report said.
Study authors were John Holahan, an Urban Institute fellow, Linda Blumberg, senior fellow, Erik Wengle, Megan McGrath, and Emily Hayes research assistants at the Institute’s Health Policy Center.
Following is a link to the full report: http://www.urban.org/UploadedPDF/413287-Marketplace-Insurance-Premiums-in-Early-Approval-States.pdf