Proposed Obamacare Rates 12% higher for 2016

HealthPocket analyzed rate filings for 3,771 plans in 45 states and found proposed Affordable Care Act premiums average a 12% rate increase for 2016. Premiums were compared for 40-year-old non-smokers in the largest city in each state. The Silver plan was the most popular exchange plan during the 2015 open enrollment period, accounting for 67% of marketplace plan selections. The 2016 rate proposals for silver plans averaged 14% higher than premiums in 2015. At a 16% increase, gold plans had the highest rate increases proposed for 2016. Entry-level bronze plans had 2016 rate proposals that averaged 9% higher than 2015 while platinum plans, the top-tier of the Affordable Care Act plans, averaged only a 6% increase in rates for 2016.

HealthPocket also found that rate increases varied significantly depending on the type of health plan. For example, among bronze plans examined, rate proposals for HMO and EPO plans were 20% higher than 2015 while PPOs were only 4% higher.

The 2016 rates represent the first time Affordable Care Act insurers have had a full year of medical claims data (including the post-deductible period) to determine rates for the new enrollee pools enabled by the law. Before the enactment, in most states applicants with expensive pre-existing conditions risked being rejected for privately purchased health insurance. Given the exclusion of this population in the pre-reform market, historical data on enrollee pools had limited value for setting Affordable Care Act rates.

Consumers will not necessarily pay the health insurance premiums proposed within the rate filings. The proposed rates must be reviewed and approved by the insurance regulators to each state in which the rates were filed. That process may result in lowering of some of the proposed rates . Moreover, some consumers will experience lower premium increases due to subsidies. Those who are unsubsidized and pay full price for health insurance, will endure the full cost of whatever rate increases are approved.

Study: Nonprofit Obamacare Insurers Have Lower Premiums

In most counties where nonprofit and for-profit insurers offered Obamacare health plans, nonprofit insurers offered the cheapest premiums for metal plans, according to a HealthPocket study. Nonprofit insurers offered the lowest Silver plan premiums in 1,072 of the 1,841. Silver plans have been the most popular metal plans during the 2015 open enrollment period, making up 67% of plan selections.

HealthPocket compared Obamacare premiums for 40-year-old non-smokers in the 34 states on the federal marketplace. Plans on state-based marketplaces are not included in the analysis, nor are off-exchange Obamacare plans, Obamacare catastrophic plans, Medicare plans, short-term insurance plans, and Medicaid plans.

On average, the lowest premiums from for-profit insurers are 0% to 2% higher than the lowest premiums from nonprofit insurers for bronze, Silver, and Gold plans. Nonprofit insurers offered 11% lower premiums than for-profit insurers for Platinum plans. Among the four metal levels, the Platinum plans are the least popular in 2015, accounting for only 3% of plan selections.

Four of the five largest health insurance companies are for-profit insurers, but over 60% of health plans with at least 100,000 enrollees are from nonprofit insurers.

Fewer Counties Have Zero Premiums Medicare Advantage Plans in 2015

While most Medicare beneficiaries in 2015 have access to Medicare Advantage plans with $0 premiums, the availability of these plans has been in decline since 2011. HealthPocket’s examination of government data found that Medicare Advantage plans with a $0 premiums in the United States dropped from 813 in 2014 to 726 in 2015, with 113 fewer counties having access to these popular $0 premiums Medicare Advantage plans.

The counties that lost $0 premiums Medicare Advantage plans were in 15 states: California, Hawaii, Idaho, Iowa, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, Oregon, Utah, Vermont, Washington, and Wyoming. Nebraska had the most counties in 2015 that lost zero premiums Medicare Advantage plans (36), followed by Montana (25), Idaho (23), California (12), and Vermont (8). The only states that did not have any $0 Medicare Advantage plans in both 2014 and 2015 were Delaware and Alaska.

HealthPocket also found that there were 16 counties that had no zero premiums Medicare Advantage plans in 2014, but gained access to these plans in 2015. These counties were in the California, Maryland, New Hampshire, New Jersey, Oregon, and Washington. Since 16 counties gained access to zero premiums Medicare Advantage plans and 129 counties lost access to zero premiums Medicare Advantage plans, there were 113 fewer counties with access to zero premiums Medicare Advantage plans in 2015.

Star ratings were higher (3.83 stars) for Medicare Advantage plans that had $0 premiums in 2015, but not 2014. Similarly the average rating for Medicare Advantage plans that had $0 premiums in both 2015 and 2014 was 3.84 stars.

Proposed Obamacare Rates 12% higher for 2016

Affordable Care Act (ACA) premiums will go up an average of 12% for 2016 over 2015, according to a report by HealthPocket. The company analyzed rate filings for 3,771 plans in 45 states. Silver plans, the most popular exchange plan, account for 67% of exchange plan selections. The proposed 2016 rates for  averaged 14% higher for Silver plans, 16% higher for Gold plans , 9% higher for entry-level Bronze plans, and 6% higher for Platinum plans.

Proposed rate increases vary depending on the type of plan. For example, rate proposals for HMO and EPO Bronze plans were 20% higher than 2015 while PPOs were only 4% higher. The 2016 rates represent the first time Affordable Care Act insurers have had a full year of medical claims data with enrolles who cannot be turned away due to a  pre-existing condition. Proposed rates must be reviewed and approved by state insurance regulators, which may result in lowering some proposed rates. Some consumers will see lower premium increases due to subsidies, but unsubsidized consumers will endure the full cost of any approved rate increase.

Poor Counties Have Lower MA Premiums, But Higher Drug Deductibles

Medicare Advantage plans in the 25 poorest counties had 14% lower premiums, but drug deductibles were 37% higher, according to a study by HealthPocket. There was considerable variation in Medicare Advantage premiums among the 25 counties analyzed. Three counties in South Dakota had average Medicare Advantage premiums that were twice as high as the national average. In contrast, average premiums in Hancock, Tennessee were 83% lower than the national average.

The poorest counties were similar to the nation with respect to the availability of $0 premium Medicare Advantage plans. Half of the counties with $0 premium plans were limited to $0 premium options without prescription drug coverage. While the average drug deductible in the 25 poorest counties was $178, Johnson County and Hancock County, Georgia had a $289 average drug deductible. Madison County Idaho had the lowest average drug deductible for Medicare Advantage plans at $40.

Kev Coleman, head of Research & Data at HealthPocket said, “With 10,000 seniors aging into the Medicare program a day and many on fixed incomes, industry analysts and government researchers must remain vigilant in monitoring Medicare insurance costs. Medicare Advantage, one of the most popular Medicare insurance options, can be very cost competitive but we found that there are pronounced regional disparities in average premiums and drug deductibles.”

Study Supports Shortening the Exchange Enrollment Period

People who shop for exchange plans tend to do so around key dates with shopping dropping off afterward, according to a HealthPocket study. The analysis supports shortening of the annual enrollment period and shifting it to the tax season. Moving Affordable Care Act enrollments to tax season would help consumers make the most informed health plan decisions since tax season is when consumers review critical issues relating to health insurance.

Consumer shopping interest was down more than 50% in the second half of the annual enrollment period for ACA exchange plans compared to the first half of the period. The government has proposed that the Obamacare annual enrollment period for 2016 be shortened to 76 days and start on October 1st. Since the Medicare enrollment period for Part D and Medicare Advantage plans is only 54 days and enrolls millions more people, HHS is expected to eventually reduce the enrollment period for the Affordable Care Act to 54 days. Based on HealthPocket’s analysis of consumer shopping behavior, such a reduction would not cause significant inconvenience for consumers. Reducing the enrollment period to 54 days could also be combined with changing the start date to avoid the overlap of the enrollment periods for the Affordable Care Act and Medicare, which results in call center congestion at insurance companies. Bruce Telkamp, CEO at HealthPocket said, “These changes would not only benefit consumers, but also reduce advertising expenditures by exchanges and insurance companies.

Young Men Saw Steep Premium Increases in 2014

Premiums for ACA plans increased an average of 78% for 23 year-old men and nearly 45% for 23-year-old women in 2014. HealthPocket compared the Obamacare market to the 2013 pre-reform market. Premiums increased 73% for 30-year-old men and 35% for 30-year-old women. Many young people don’t qualify for subsidies because the premium does not reach the percentage of income needed to trigger a subsidy. Premiums increased 37.5% for 63 year-old women and 22.7% for 63 year-old men. Kev Coleman, head of Research & Data at HealthPocket said, “The market trend we observed was an increase in average premium; this increase may have been obscured…by the fact that the first Affordable Care Act health plans were new and had no history against which to declare a rate increase within their state filing.” Some people get subsidies under the Affordable Care Act while others avoid a premium rate-up or rejection due to an expensive pre-existing condition, he added. For more information,

Medicare Advantage Premiums Climb

The number of $0 premium Medicare Advantage plans will decrease 19% from 2014 to 2015, according to HealthPocket. The analysis is based on the federal government’s 2015 Medicare insurance data. The average Medicare Advantage premium will be $62.69 in 2015, which is 2% higher than in 2014. It is also 94% higher than the average of $32.26 that the government reported before changing how it calculates average premiums. The 2015 premium average is based on anticipated plan enrollment rather than average premiums of all Part D plan options. The report includes the following statistics:
• The average drug deductible for 2015 Medicare Advantage plans is $129.87, which is 94% higher than in 2014. The maximum allowable drug deductible is $320 in 2015.
• The average all Medicare Part D drug plan for 2015 is $53.90, which is 1% lower than in 2014. However, it is 68% higher than the average premium before the government changed how it calculates average premiums.
• The average deductible for 2015 Medicare Part D drug plans is $157.91, which is 1% higher than in 2014. The maximum allowable Medicare Part D deductible is $320 in 2015.
• The cap on out-of-pocket costs for covered drug expenses in Part D and Medicare Advantage plans is $4,700 in 2015. This limit is $150 higher than in 2014. After this out-of-pocket threshold is reached, the beneficiary gets catastrophic coverage with lower drug cost-sharing.
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When a Platinum Plan Is a Better Buy

Platinum plans may have the highest premiums among the Obamacare health plans. But they may save money for people taking specialty drugs because of their reduced co-payments and lower caps on annual out-of-pocket costs, according to a study by HealthPocket. Platinum plans have the lowest average out-of-pocket costs for the five common specialty drugs. HealthPocket looked at 2015 Obamacare metal plans whose rate filings have been made public. The average out-of-pocket specialty drug costs for platinum plans were 64% lower than gold plans, 74% lower than silver plans, and 78% lower than bronze plans.

The difference in out-of-pocket costs is dramatic. For example, taking the specialty drug Humira (used to treat inflammation) could result in annual out-of-pocket costs of $6,381.38 for 2015 bronze plans compared to only $1,416.67 for 2015 platinum plans. However, not every Obamacare health plan covers the same drugs; and caps on annual out-of-pocket costs can vary within the same metal tier. Consumers who take expensive specialty drugs need to make sure that their drugs are included in the list of covered medications on the Obamacare plans they are comparing.

“Specialty drugs represent an increasing percentage of insurance spending for prescription medications. In coming years, they’ll become the largest single cost category despite the fact that specialty drugs serve a minority of the population,” said Kev Coleman, Head of Research & Data at HealthPocket. For those who depend on these drugs, comparing premiums and annual caps on out-of-pocket costs is often more important than comparing health plans’ copayments and co-insurance fees for drugs, he added. For more information, visit,

Some Medicare Advantage Companies Fail At Customer Service

Using government data, HealthPocket analyzed customer service in the call centers of Medicare Advantage companies. Hold times, dropped calls, accuracy of information provided, and customer satisfaction metrics were all included in the analysis of every Medicare Advantage plan that operates in multiple states. HealthPocket found low customer service scores among several large Medicare Advantage companies. While the top five companies are regional brands with lower brand recognition nationally, several of the bottom five companies are popular insurance brands. UnitedHealth Group includes the familiar AARP-branded Medicare Advantage products, and Health Net and WellCare are also Medicare Advantage brands with considerable enrollee populations. More than15% of the Medicare Advantage companies failed to meet the government standards for customer service through a call center. The following companies had the highest customer service scores:

1. HealthPartners
2. Gundersen Lutheran Health System Inc.
3. Cambia Health Solutions
4. Health Plan of the Upper Ohio Valley
5. University of Pittsburgh Medical Center The bottom five companies were:
1. Universal Health Care Group
2. Health Net
3. UnitedHealth Group
4. WellCare Health Plans
5. Munich American Holding Corporation The complete findings and methodology can be reviewed here

Last Updated 05/25/2022

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