2019 Affordable Care Act rates make short-term health insurance plans more attractive
Even with the 1.5 percent decline in silver plan rates for 2019, consumers have been dealt a net rate increase of 69.2 percent from 2016 to 2019.
Last week the Centers for Medicare and Medicaid Services said that 2019 Affordable Care Act health plan prices will drop by 1.5 percent for silver plans, the middle tier of ACA plans, which may make short-term insurance plans more attractive for consumers, according to an analysis by Agile Health Insurance.
Previous years saw significant increases, though, with premiums doubling. So even with the 1.5 percent decline in ACA rates for 2019, consumers have been dealt a net rate increase of 69.2 percent from 2016 to 2019. Price stabilization is a key factor in measuring the effectiveness of the ACA.
IMPACT
With good news comes some bad news. The bad news is that the average silver plan premium in 2018 was $536.94 for a 40-year-old female non-smoker, so it's not much relief for those Americans priced out of the ACA market.
A previous analysis of 2018 ACA exchange plan affordability found that a family of three earning the average U.S. household income, with parents age 30 and one child, would not be able to find an affordable silver plan in any county. However, 9 out of 10 Americans receive tax subsidies for plans purchased through the ACA.
The 1.5 percent decline in rates in the coming year will likely not provide much relief. In comparison, a recent analysis of short-term health insurance plans for a 40-year-old female non-smoker found an average monthly premium of $199.93, and this included plans with much lower deductibles than the average ACA silver plan.
Although short-term health insurance does not include the same breadth of benefits as ACA plans, they provide medical coverage for illnesses and injuries and include services such as emergency room, hospitalization, doctors, specialists, labs and other benefits.
In 2019 there will be a wide variance in costs between states as healthcare prices remain largely based on locality, the analysis found.
For example, those in the state of Washington will see an average premium increase of 13.8 percent for ACA marketplace plans while those in Iowa will see their first rate decrease for these plans with the state average premium dropping by 7.9 percent.
In the short-term health insurance market, there will be great variance as well, with the average monthly premium for a 40-year-old woman coming to $146.24 in Kansas, but $331.95 in Florida.
THE TREND
Under the Trump administration, CMS is taking credit for stabilizing the market and lowering premiums by offering states flexibility through seven types of waivers, easing regulations and allowing limited duration short-term plans and association health plans.
The waivers allow states to set up a reinsurance program for insurers to submit their high claims into the risk pool.
Open enrollment for most states is November 1 through December 15.
Twitter: @JELagasse
Email the writer: jeff.lagasse@himssmedia.com
