Affordable Care Act Rates Rising

Health Insurance

December 15, 2015

According to the governments latest figures there will be a spike in some of the most popular health plans sold through the federal insurance exchange, an increase of nearly four times what it rose last year. Plans this year will rise an average of 7.5 percent on the plans that is held as the standard by Obamacare as the required coverage for Americans to receive subsidies.

The Department of Health and Human Services also showed a compilation of insurance rates from around the country, showing that in some places the increases varied greatly. It appears as though people who live in larger more populous areas will see lower increases, than people living in more rural areas. For example, premium increases are going up in Oklahoma by 35 percent while there was a decrease in premium cost in Indiana of almost 13 percent. This news came out less than a week before open-enrollment is set to begin, which created some criticism politically from both sides of the aisle.

Importance of Shopping Around Being Stressed

But, HHS defended its positions contending that health plans will be affordable to people who shop for the best rates, and that even with substantial increases in premium rates Americans will be able to afford them because nine of every ten people qualify for subsidies and that will ease the financial pain. Emphasis has been stressed on the importance of shopping costs and comparing plans even if it means changing plans every year. Federal officials say that with the available tax credits ninety percent of people who have already signed up for a health insurance plan in the silver category would only pay about $100.00 a month for their premium, but does not address the increased cost of prescription drugs and rising expense of deductibles and copayments. While subsidies help to keep the cost of premiums down, the out-of-pocket expenses to subsidy consumers is typically much more than people who have employer based health insurance.

Kevin Counihan, of HHS said in a statement, “If consumers come back to the Marketplace and shop, they may be able to find a plan that saves them money and meets their health needs.” But recent figures indicate fewer than one-third of people who already had a plan switched plans to get better prices or coverage. This is a concern of the Obama administration because as the premium costs go up, so too does the cost of the consumer subsidies the federal government must pay for.

There are other factors that are driving premium prices up too. Insurers are really just getting an idea of just how much the actual cost of providing care to their policy holders is and that care is more expensive to pay for in some places than others for insurers. Another factor is that as some plans attracted more consumers than others the need for insurers to be more competitive in their pricing has waned some, making them more likely to make premium increases to absorb some of their miscalculations in what caring for their consumers was actually costing them. The message here again is to shop around for your coverage, there are many new insurers joining the insurance market and finding the best priced policy is just as important as an insurance plan that truly meets your health care needs.


Final Outlook

The bottom line with health care these days is, for a number of years to come the insurance industry and healthcare guidelines are going to be a rapidly changing environment and consumers need to adapt with the changes. The future of the ACA may well depend on people being more proactive in their healthcare choices and getting the biggest bang for their healthcare dollars each and every year. Changing your health plan does not necessarily mean you are changing doctors and other health care providers every year; you just need to be diligent about shopping around.