TOPEKA — If Kansas insurance plans offered through the federal marketplace increased 25 percent in 2017, 67 percent of HealthCare.gov consumers still could purchase plans for less than $75 a month, officials said.
On Wednesday, the U.S. Department of Health and Human Services released data from a nationwide study of health insurance plans offered through HealthCare.gov, exploring the impact of projected rising costs next year on consumers.
“Tax credits protect consumers from rate increases,” said Kathryn Martin, acting assistant secretary for planning and evaluation.
Last year, she said, double-digit premium increases were projected for 2016, but the average premiums for consumers with tax credits increased just $4.
In the Kansas data, 63 percent of consumers enrolled in HealthCare.gov plans in 2016 paid less than $75 a month, while 70 percent paid less than $100 per month. If premiums increased 25 percent next year in the state, those jumped to 67 percent and 72 percent, respectively.
But if the premiums should jump 50 percent in 2017, the numbers are better, HHS data reported. Seventy percent of Kansans in the marketplace would pay less than $75 a month, while 75 percent would pay less than $100. That’s because the tax credits are designed to increase as rates increase, Martin said.
“It is true that as rates go up and you are buying on the exchange, your subsidy is going to go up as well,” said Clark Schultz, director of government relations for the Kansas Insurance Department.
“So the net effect of what you’re paying is much less than what it would be if you were paying the entire bill yourself. It’s just that the federal government is paying the vast majority of it, so you’re not seeing it. Somebody’s paying it; the federal government’s paying.”
Schultz said the final rates for plans available in the Kansas marketplace won’t be available until September. Plans submitted for 2017 vary from premium increases of 3 percent to more than 49 percent. Twenty-three plans have been proposed for the state.
Although insurance companies still can change their offerings or decide to pull out, as Coventry did in December 2015, at this point, Schultz said residents of every Kansas county will have at least two options for their health insurance plans.
Companies like Coventry are losing money, and that’s why they’re pulling out, he said. On the HHS teleconference, officials there said companies did underestimate what the costs would be in the HealthCare.gov marketplace.
“This is a brand-new market,” said Mandy Cohen, chief operating officer for Centers for Medicare and Medicaid.
“This market has totally new rules of the road because folks are required to provide insurance to people with pre-existing conditions. That’s a new factor for folks. It has financial assistance. Our issuers are learning about these new rules of the road. Some are adjusting faster than others.”
Minnesota-based Medica, for instance, entered the Kansas market this year.