Kaiser Health News –
Spetember 05, 2013:
With open enrollment in new insurance marketplaces set to begin Oct. 1, a new Kaiser Family Foundation analysis provides an early look at insurance premiums in 17 states and Washington, DC that have publicly released comprehensive data about their rates and the impact of tax credits that will offset part of the costs for low- and moderate-income families.
The analysis compares the premiums in the largest cities in each of the 17 states plus DC for individuals and families in different circumstances to illustrate the insurance rates they might pay, with and without the tax credits created under the law to make coverage more affordable. The 17 states plus DC include eleven operating their own marketplaces (also called exchanges) and seven that have defaulted to the federal government.
At least two insurers will offer coverage through the insurance marketplaces in each geographic area that includes the 18 cities. Most areas will have three or more insurers, and some have 10 or more.
The analysis shows a wide range of premiums across the 18 cities, with tax credits varying based on enrollees’ income levels and the second-lowest-cost “silver” plan available in each market. Eligible enrollees may use their tax credits to help pay for the silver plan or any other generally available plan in the marketplace, including the less generous (and less costly) “bronze” plan.
For a 40-year-old, the monthly premiums for the second-lowest-cost silver plan range from $201 in Portland, Ore., and $212 in Albuquerque, N.M., to $390 in New York City and $413 in Burlington, Vt., before accounting for the tax credit. The tax credits effectively reduce the variations for people with low to moderate incomes (up to 400 percent of the federal poverty level, or about $94,000 for a family of four) who choose the second-lowest-cost silver plan in their market. If the 40-year-old had an annual income of about $29,000 (250 percent of the federal poverty level), he or she would be eligible for tax credits that would reduce the monthly premiums to $193 in any of the 18 markets.
That 40-year-old could also apply the tax credit toward the purchase of a less costly plan, such as the least expensive bronze plan, and further reduce his or her monthly premiums. After taking the tax credits into account, a 40-year-old could pay between $97 per month (in Hartford, Conn.) and $168 per month (in Sioux Falls, S.D.) for a bronze plan in his or her market.
The analysis provides similar state-by-state estimates for the cost of coverage for a 25-year-old and a 60-year-old, as well as the impact of tax credits on those rates. It also includes additional examples for a family of four and an older couple in each of the 18 cities: Los Angeles, Calif.; Denver, Colo.; Hartford, Conn.; Washington, DC; Indianapolis, Ind.; Baltimore, Md.; Portland, Maine; Billings, Mont.; Omaha, Neb.; Albuquerque, N.M.; New York City, N.Y.; Cleveland, Ohio; Portland, Ore.; Providence, R.I.; Sioux Falls, S.D.; Richmond, Va.; Burlington, Vt.; and Seattle, Wash.
An Early Look at Premiums and Insurer Participation in Health Insurance Marketplaces, 2014, is available online.
(Editors Note: To see the detailed cost breakdown, use link in CHOICE News “What Will It Really Cost” blurb, at right)