2016 Exchange Rates- OUCH

[ERhoosier]

Major health insurers have first full year of ACA cost experience data to use in setting their 2016 rates. Looks like some (but not all) regions are in for quite a sticker shock. For 6 states reporting so far, prelim proposed rate increases ave 18+% with some over 30%. Of course, these rates are only proposed but are likely much closer to final rates this time around. Unlike past years, 2016 rates will be based on actual HC cost experience and not estimates as in past years. State regulators will have a tough time enforcing rates lower than the actual cost of care delivery. (How could any HI carrier (profit, non-profit, or COOP) stay in a region where their product is basically guaranteed to lose $$?) This could be a big $$$ hit for non-subsidized ERs in these regions, as well as big hit to Fed budget due to big increased ACA subsidies

Yahoo!

Obamacare sticker shock: Insurers propose rate hikes for 2016 - Jun. 2, 2015

Another factor behind some of these HI increases may be carriers adjusting to 2016 phase out of industry subsidy of "Temporary Risk Corridors".
Explaining Health Care Reform: Risk Adjustment, Reinsurance, and Risk Corridors | The Henry J. Kaiser Family Foundation

Will be interesting to see how this plays out across the US as more states report in.

 

[Fermion]

Yay for subsidized ACA!

 

[Texas Proud]

I have read that my insurance company is proposing a 20% increase.... not sure if it is for all policies or not...


To me the real problem is one where I read an insurance company is putting forth a SILVER plan (I should say two silver plans) that has a $6K deductible and a small network to attract people to sign up... the article said that this will affect all subsidies since the second lowest silver plan cost will be so low... in fact lower than some bronze plans....

 

[rodi]

I wonder if they are raising the rates, at a similar percentage, to non exchange policies such as employer provided policies.

Never mind - I read the cnn link.

In Florida, for instance, United Healthcare (UNH) wants to raise the rates of plans sold on the Obamacare exchange by an average of 18%. Individual policies available outside the exchange through United Healthcare or through a broker would go up by 31%, on average, with hikes as high as 60% for certain plans in certain locations.

So... exchange policies are going up LESS than private policies.

I'm sure my family is not the trigger of this - but the article says it's because consumers are using more medical services. Um... after years of very little medical care we faced 3 broken bones and one short term hospitalization under our new ACA exchange policy. We're on a high deductible plan - so it's all been out of pocket (at the negotiated rates).... but if you look at our family record... very little use then BOOM - lots of use. Like I said - I'm just one family... but that statistic of more use in 2015 definitely holds true for us.... not intended... just have klutzy kids who break bones.

 

[utrecht]

Trying to afford health insurance seems to me to be a significantly bigger problem than pension reform. Why isn't health insurance price reform all over the news?

If you pay $750 per month to insure a family of 3 right now (which already seems astronomical), you will be paying $4000 per month in 10 years if we keep getting 18% increases. There is no way this is sustainable.

I know the government is subsidizing a lot of people, including a lot of early retirees here, under ACA, but there's no way they can subsidize those kind of figures for very long.

 

[aaronc879]

Yay for subsidized ACA!

I'll hold off on celebrating until after the Supreme Courts decision later this month. If they remove my subsidy then my health ins. costs would go from 4% of my income to over 20% of my income and I would have to consider going without healthcare.

 

[rodi]

< Mod hat on >

Folks -
Like other ACA topics - this thread could be a good discussion of insurance rates, increases, and perhaps how the ACA factors into this. But it also could veer into political back and forth - which would cause the topic to get shut down.

Please keep it to the facts at hand and on topic.

< Mod hat off >

 

[Fermion]

I will just point out that if they get rid of the subsidies, the requirement to cover pregnancy for a 60 year old man will also go away. Premiums should go down then.

Also, the very high deductible catastrophic plans will come back since you can't justify the high rates with no subsidy for lower income people.

 

[Htown Harry]

I'm always a bit skeptical when I see "news" based on rate filings rather than rate approvals.

You can click through a link the article to a healthcare.gov site with data on individual filings.

I checked a few examples in Texas. BCBS has a big market share here. This excerpt from their filing suggests an increase may in fact be in order. If $400 million more went out the door than came in, they can't sustain the same coverages at the same rates.

Scope and Range of the Rate Increase:

Blue Cross and Blue Shield of Texas (BCBSTX) is filing new rates to be effective January 1, 2016, for its Individual ACA metallic coverage. As measured in the Unified Rate Review Template (URRT), the range of rate increases by product is -3% to 20%.

Changes in allowable rating factors, such as age, geographical area, or tobacco use, may also impact the premium amount for the coverage.

As of March 31, 2015, there were 730,833 members on Individual Affordable Care Act (ACA) plans that may be affected by these proposed rates.

Financial Experience of the Product:

From the filed URRT, earned premiums for all non-grandfathered Individual plans during calendar year 2014 were $2,116,218,685, and total claims incurred were $2,511,688,837.

After application of the ACA federal risk mitigation provisions, the total BCBSTX Individual non-grandfathered block of business experienced a financial loss of 17% of premium in 2014, and the total BCBSTX ACA block of business experienced a loss of 20% of premium in 2014.

The proposed rates effective January 1, 2016, are expected to achieve the loss ratio assumed in the rate development.

Changes in Medical Service Costs:

The main driver of the increase in the proposed rates is that the actual claims experience of the members in these Individual ACA metallic policies is significantly higher than expected.

Changes in Benefits:

There are no legally required changes to covered benefits, and therefore no significant changes to the benefit structure.

 

[Ian S]

I will just point out that if they get rid of the subsidies, the requirement to cover pregnancy for a 60 year old man will also go away. Premiums should go down then.

Also, the very high deductible catastrophic plans will come back since you can't justify the high rates with no subsidy for lower income people.

Of course, in that event, they won't have to cover the cost of prostate cancer for women so it should all balance out!

 

[Free_at_49]

Healthcare cost is already too high, and quality is very low by international standards. Especially when you compare with countries that have universal care that covers everything. You can download the data directly (PDF) from the World Health Organization.

 

[FUEGO]

Just a guess here:

One group of people is able to get insurance for the first time ever and take care of "deferred maintenance" like checking on those moles, visiting the doc to have that condition that's been nagging you but you never had an extra $5k or $10k to take care of, etc. I imagine lots of folks in this group of people are in the lower income brackets and get the sweet sweet gold plated silver plans in the sub-200% AGI range with cost sharing of 87-94%. That means zero or very low deductibles and very low OOP plus tiny or no copays for primary care and specialists.

Another group of people got good insurance instead of crappy insurance for the first time (due to ACA requirements or because of the great subsidies allowing them to get much better coverage). These folks are doing the same thing - taking care of deferred maintenance.

I know our family is in the second group of people (moving from a high deductible plan to a gold plated silver plan with heavy cost sharing subsidy). There are a few precautionary but totally not critical things we'll get checked out. And once we pay a little and hit our OOP max, we might as well get everything under the sun done if it's likely to help improve our health even just a little bit (ie we won't be paying a dime once we hit the low OOP max).

My guess is that 2015 and 2016 claims will level off versus 2014 claims.

 

[AllDone]

As has been pointed out elsewhere, insurance companies have to submit proposals for premium increases of 10% or more, but not for premium increases in the single digits. That badly skews the average when you look at just the proposed increases. News sources that report just the proposed premium increases without putting them in context are, at best, reporting the changes incorrectly. It's unrealistic to expect that ACA or no ACA, we won't see any price increases.

Another point worth considering is that the people who entered the system the first year where the sickest, while the people who deferred entering until later were less sick and will be Have less of an impact on cost.

In the first two years of operation, we've seen lower than expected price increases and lower than expected costs to the government. I would assume that at some point we'll see higher costs appear, but so far, so good.

 

[Mulligan]

This past January my underwritten plan was cancelled and I got a nice premium increase from about $85 to about $285 and deductible raised $1000 to $6500. Read in paper last week my carrier Coventry will be asking for rate increases of over 20% and that is not counting the yearly age increase in premium.
Before Obamacare my premium raised $15 in 4 years. Now in 13 months it looks like way over $250 with worse coverage. Better and more affordable my arse.
But Im trapped now and have to root for SC to uphold law. Otherwise if subsidies end, my insurance pool would consist of sick people and me. And then one month later I would be gone too.


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[Winemaker]

2016 Exchange Rates

My wife told me that during the Nov 15 signup period, one of her co-worker's husband changed their policy because the premiums were $300.00 a month cheaper. He obviously did not read all of the fine print because they now pay over $500.00 a month; they are charged for everything, dr. visits, prescriptions, allergy shots; they were previously "free".

Just make sure whatever policy you choose; you understand it.

 

[Texas Proud]

I'm always a bit skeptical when I see "news" based on rate filings rather than rate approvals.

You can click through a link the article to a healthcare.gov site with data on individual filings.

I checked a few examples in Texas. BCBS has a big market share here. This excerpt from their filing suggests an increase may in fact be in order. If $400 million more went out the door than came in, they can't sustain the same coverages at the same rates.

The thing I do not understand is if they have all of their plans included or just the number posted... IOW, my plan might not go up as much if it is not included... but with those numbers, I bet it is all plans....


Also, what metal level might be interesting.... is it the silver or gold that need to go up or all of them...

 

[Bamaman]

And the U.S. Supreme Court's decision on the ACA is coming soon--about the legitimacy of the government supplementary payments in some, but not all states.

It's going to be very interesting, and possibly a big game changer.

 

[Mulligan]

The thing I do not understand is if they have all of their plans included or just the number posted... IOW, my plan might not go up as much if it is not included... but with those numbers, I bet it is all plans....


Also, what metal level might be interesting.... is it the silver or gold that need to go up or all of them...

In my area Coventry was by far the cheaper plan. Since I already had it, I transferred to the ACA plan when mine was cancelled. They are now jumping the highest by over 20% while BCBS is raising less than 10% from what I have read. So I am guessing they both are going to have very similar rates as Coventry probably got burned by everyone buying the "cheaper plan".


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[dallas27]

Any numbers yet about whether ACA has reduced the costs of hospitalizing the "uninsured"? If so, i'm thinking 90% if that cash should be headed toward subsidies .


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[meierlde]

I will just point out that if they get rid of the subsidies, the requirement to cover pregnancy for a 60 year old man will also go away. Premiums should go down then.

Also, the very high deductible catastrophic plans will come back since you can't justify the high rates with no subsidy for lower income people.

Actually all the other regulation in the ACA will stay just no subsidy. The case is a narrow one. Now after this what may happen is another question. (Also High deductable cat plans will still be outlawed pending any changes in the law)

 

[Mulligan]

Actually all the other regulation in the ACA will stay just no subsidy. The case is a narrow one. Now after this what may happen is another question. (Also High deductable cat plans will still be outlawed pending any changes in the law)

Exactly and I wonder if many people are even aware. ACA has cost me dearly but SC could really stick it to me if they rule against exchange subsidies. Many forward thinking states could just simply set up an exchange, but my state wont even consider it in its present constitution. It focus's its attention on more important things such as writing legislation making Sharia law illegal in our state. You know, the important stuff!


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[ERhoosier]

Healthcare cost is already too high, and quality is very low by international standards. Especially when you compare with countries that have universal care that covers everything. You can download the data directly (PDF) from the World Health Organization.

While I fully agree that US HC costs are far too high and do not consistently produce better outcomes than some other developed nations, quality in US is certainly not "very low". The wiki (1st) link you cite is of a 15 yrs old and highly suspect WHO ranking system. Can it be seriously argued that US HC system delivers inferior care to that of Greece, Cyprus, Dominica, etc. Or that UK HC system is also inferior to Greece

IMHO- A more relevant comparo is to current care given by some of the better facilities in Mexico. Some US insurers are already starting to cover care delivered there.
http://www.usatoday.com/story/news/nation/2014/05/07/healthcare-mexico-obamacare/8517917/
I believe that as US HC costs continue to rise, this 'medical tourism' will grow as well. I have no problem with this so long as quality of actual care delivery (measured independently & objectively) meets reasonable standards and folks realize the possible pitfalls of seeking care outside their own nation.

 

[Free_at_49]

While I fully agree that US HC costs are far too high and do not consistently produce better outcomes than some other developed nations, quality in US is certainly not "very low". The wiki (1st) link you cite is of a 15 yrs old and highly suspect WHO ranking system. Can it be seriously argued that US HC system delivers inferior care to that of Greece, Cyprus, Dominica, etc. Or that UK HC system is also inferior to Greece

IMHO- A more relevant comparo is to current care given by some of the better facilities in Mexico. Some US insurers are already starting to cover care delivered there.
Health care, and patients, go south — to Mexico
I believe that as US HC costs continue to rise, this 'medical tourism' will grow as well. I have no problem with this so long as quality of actual care delivery (measured independently & objectively) meets reasonable standards and folks realize the possible pitfalls of seeking care outside their own nation.

I think you can google and fetch reports for any year.

 

[ziggy29]

Mine was up over 25% last year, wouldn't be surprised to see the same next year. BCBSTX has been the only "player" in my part of the state, which sucks in terms of lack of competitive pressures on rate increases. But as I am no longer going to be on my Exchange plan as of 6/30, it's a moot point for me. At least for now.

 

[AllDone]

Charles Gaba (who follows the rate increase very closely) is estimating an overall average increase of 5.4% next year although there are clearly some insurers who are asking for much more:

Obamacare 2016 premiums: Insurers ask for big rate hikes