- A new HHS report released Tuesday finds most consumers did not experience double percentage premium increases for 2016 coverage in the health insurance marketplace.
- For people who got tax credits, the average cost of marketplace coverage increased just 4%, from $102 per month to $106.
- The increase in the average premium was 8% between 2015 and 2016, "not much higher than the 7.2% increase in the second-lowest silver plan premium reported at the start of the 2016 open enrollment," the report stated.
According to the report, 67% of HealthCare.gov consumers opted for a new plan in 2016. Of those, 43% were returning customers who switched plans; the rest were new enrollees. To that end, HHS stated that consumer shopping around for premiums "sharply reduces premium changes."
The report posited the 8% increase in the average premium after shopping demonstrates "enrollees’ actual premiums depend on the dynamics of the entire market not just issuers’ pricing decisions."
To that note, the number of participating payers averaged 10 per state, up from nine in 2015 and eight in 2014.
The lower premium increases are at odds with earlier projections based on proposed premium changes. HHS stresses initial insurer rate filings don’t reliably predict what consumers will pay the following year because they don’t take into account rate review, account shopping, and tax credits.
The report points out, for example, preliminary rates are subject to state review and often change before being finalized. The ACA exchanges also help consumers shop for the best price plans for their needs.
In addition, 85% of Obamacare consumers receive tax credits, which go up if the price of the second-lowest silver plan rises. Those credits aren’t figured in when plans report increases in rate filings. "The fact that consumers saw only small premium increases after tax credits is not a coincidence," the report stated. "The premium tax credit is designed to ensure that affordable options are available to consumers."