Rates to jump 30 percent for some ACA health plans

Rates on health plans sold in Pennsylvania under the Affordable Care Act will increase more than state officials had expected following the Trump administration’s decision to end cost-sharing payments authorized under the law.

Consumers shopping on the individual market will see an especially steep price hike, with premiums increasing by an average of 30.6 percent for 2018.

The state insurance department had projected an increase of 7.6 percent before President Donald Trump announced last week that he planned to end the subsidy payments.

The subsidies helped insurers cover higher costs associated with customers who were getting insurance for the first time under the ACA.

Rates in the small group market, which is used by employers with 50 or fewer employees, will increase by an average of 7.6 percent for 2018.

“This is not the situation I hoped we would be in, but due to President Trump’s refusal to make cost-sharing reduction payments for 2018 and Congress’s inaction to appropriate funds, it is the reality that state regulators must face and the reason rate increases will be higher than they should be across the country,” acting Pennsylvania insurance commissioner Jessica Altman said in a press release announcing the new rates Monday.

The rate increases apply only to on-exchange silver-level plans, which offer mid-range premiums and deductibles and are the only plans eligible for cost-sharing reductions. The steepest rate increases will not affect consumers who are eligible for such reductions, nor will they affect consumers on other plans. 

Altman encouraged individuals who do not qualify for premium subsidies to consider bronze, gold or platinum options or off-exchange plans, which they must buy directly from one of the state’s five marketplace insurers or through a licensed agent or broker. Consumers can also compare on- and off-exchanges plans through the state’s Consumers’ Checkbook tool.

Open enrollment for 2018 health insurance runs from Nov. 1 until Dec. 15.

The increase comes at a time when state regulators say they were starting to see rates level out in the individual market, where consumers who do not receive coverage through an employer or public program can shop. Premiums in that market were among the hardest hit by increases that followed implementation of the ACA.

“Our market was stabilizing, but we all knew that stability was on fragile ground,” Altman said Monday. “Unfortunately, the Trump Administration understood that too.”

Altman is one of several Pennsylvania leaders criticizing the Trump administration’s handling of the ACA subsidies. That list of critics includes Pennsylvania Attorney General Josh Shapiro, who recently joined 18 other state AGs in suing the president to prevent him from stopping the payments to insurers.

Trump has said the payments were illegal and amounted to a bailout for insurance companies.

Jennifer Wentz
Jennifer Wentz covers Lancaster County, York County, financial services, taxation and legal services. Have a tip or question for her? Email her at jwentz@cpbj.com.

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