The most significant changes to our healthcare system came through insurance regulatory changes, and when comes to insurance post Affordable Care Act, the individual marketplace lays the groundwork for the group marketplace.
Many American’s are receiving premium increases. Premium changes in the ACA state based marketplaces are driven by many new factors. The most important plan to pay attention to is the silver plan and in particular the second lowest silver plan in each state because this is what subsidies and cost sharing are based on.
Early indications show costs for the second lowest silver plans are growing at a higher rate than they were in previous years. A weighted average will be 10 percent on average for these plans, and in some markets rate increases will be up to 20 percent or more.
In some states there will be fewer insurers participating than in previous years. The ACA was supposed to create more competition through new programs like co-ops, but many of them went bankrupt or didn’t work out, and the result has been less choice.
Another problem is people do not stay with a plan for a long time as many drop plans right after utilizing for a catastrophic condition.
In addition to switching plans, enrollees who do need to change plans need to realize this could impact changing their doctors as narrow networks persist.
Seven states will see a drop in insurer participation due to United healthcare pulling out of most of the states in 2016. 11.1 million were signing up for plans in March, however, 1.6 million dropped out and often failing to pay premiums.
As a result of this more than 9 percent of American’s are still without coverage, and the affect on the group marketplace is going to be substantial.
This takes us to the question of what is happening in the small employer marketplace as enrollments in the SHOP plan have been lackluster. Employers 2-9 did not have much impact and most of these employers are grappling with premium increases.
Those in the 10-24 saw minimal benefit from the tax credits and this segment will further shrink according to industry experts
Employers in the 25-49 market segment are not affected by the employer mandate, however, due to community rating, the premiums are just too expensive.
The average premium for employers 3-300 employees rose by over 12 percent on average. Employees were charged more to cover these increases resulting in less take-home pay. Many are predicting that 2017 is going to be a difficult year.
If premiums continue to skyrocket, where are these people going and what are they taking? Many are now taking their group sponsored plan.
Approximately 46 percent select PPO, 24 percent select HSA plan, 17 percent choose point of service plan (POS) and 13 percent are selecting an HMO.
People want choice and other fringes in addition to the core benefits such ancillary products like hospitalization or critical illness policies.
There are certainly a lot of questions and options.
Recently on our radio program, America’s Healthcare Challenge, we announced our very special “Benefits Marketplace Series.”
We have divided the Series into two parts: (1) Medicare and the Senior marketplace – beginning August 20th, and (2) The Employer / Employee benefits marketplace – beginning August 6.
Each of these topic areas is covered in depth – to allow for a full airing of the concerns of our listening audience. This is provided by E.D. Bellis as a public service.
Check out News Talk 1290 this week on Saturday and our show page for this very important and valuable information.
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