- Consumers who buy health insurance through the Affordable Care Act marketplaces could face hefty premium hikes next year, following several years of stable rates, according to a new analysis from the Kaiser Family Foundation. The 72 insurers KFF reviewed are targeting a 10% median rate boost in 2023, filings to state regulators revealed.
- Insurers said rising prices paid to hospitals, doctors and drug companies, along with increased use of services by plan enrollees, are driving the proposed premium hikes. Of those that listed an impact from the expiration of American Rescue Plan Act subsidies, about half said it would put slight upward pressure on their unsubsidized rates.
- However, for the 13 million subsidized enrollees, the tax credits due to expire at the end of this year would have a much bigger impact, with premium payments expected to rise by an average of 53% if Congress does not extend the subsidies, KFF found.
Steep rate increases in health insurance premiums would deal another blow to consumers already stung by soaring costs for everything from food and fuel to housing and cars, with the U.S. inflation rate now running at a 41-year high.
Consumers with ACA marketplace coverage saw rates decline for three straight years, with the average premium dipping 1.8% in 2022, according to the Urban Institute. A record 14.5 million people signed up for coverage through the marketplaces this year, in part because pandemic relief funds made the cost more affordable.
The Biden administration estimates about 3.4 million consumers would lose coverage if the ARP subsidies, enacted in March 2021, expire. A Democrat-led effort to make the subsidies permanent has stalled in Congress, but Sen. Joe Manchin, D-W.Va., has told Democratic leaders that he is open to a two-year extension of the credits as part of President Biden's proposed economic package, according to the Washington Post.
The premium hikes requested for 2023 by marketplace insurers are preliminary and can change during the review process before being finalized later this summer. The KFF analysis looked at early rate filings in 13 states and the District of Columbia.
Of the 72 marketplace insurers reviewed in the study, just four were looking to lower their premium rates. Eight were seeking rate hikes of at least 20%. Most insurers are requesting premium increases of between 5% and 14%, KFF said.