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 These increases do not take into account advance premium tax
credits, which lower the monthly costs for the overwhelming majority
of Marketplace consumers. About 8 in 10 individuals who selected a
2015 Marketplace plan qualified for financial assistance, and the
average advance premium tax credits for those enrollees who
qualified for financial assistance was $270 per month. The entire
report can be found below.
Open Enrollment in the Health Insurance Marketplace starts on
November 1, 2015 and runs through January 31, 2016. Consumers must
sign up by December 15 to have coverage that starts January 1.
Consumers can find help by calling 1-800-318-2596 (TTY:
1-855-889-4325) 24/7 or find in person assistance in their local
area by visiting localhelp.healthcare.gov.
2016 Marketplace Affordability Snapshot
The next Open Enrollment period for the Health Insurance Marketplace
begins on November 1, 2015 for coverage starting on January 1, 2016.
According to an HHS analysis, about 8 out of 10 returning consumers
will be able to buy a plan with premiums less than $100 dollars a
month after tax credits; and about 7 out of 10 will have a plan
available for less than $75 a month. Highlights of the 2016
Marketplace Affordability Snapshot include: New HHS data indicates that in 2016 nearly 8 in 10 returning
Marketplace consumers will be able to buy a plan with premiums less
than $100 month after tax credits.
In addition, about 7 in 10 returning Marketplace consumers will be
able to buy a plan for $75 or less in monthly premiums after tax
credits in 2016.
The average rate increase for a benchmark plan across 30 of the
largest markets, representing 60 percent of Marketplace enrollees,
is 6.3 percent. This rate increase does not account for the benefit
provided by tax credits to eligible consumers.
Across all markets in the 37 states, the cost of the benchmark plan
will increase an average of 7.5 percent.
For 2016, over two thirds of counties will have three or more
issuers.
New analysis based on the second open enrollment found that those
returning consumers who switched plans within the same metal tier
saved an average of nearly $400 on their 2015 annualized premiums
after tax credits as compared to those who stayed in their same
plans.
The 2016 Affordability Snapshot provides a review of the final rate
increases for second lowest cost silver plans, known as benchmark
plans, which will be available for purchase in the 37 states that
used the HealthCare.gov platform in 2015, including those in the
Federally-facilitated Marketplace, State Partnership Marketplaces,
and supported State-based Marketplaces.[1]
 Across all 37 states that used the HealthCare.gov platform, the cost
of the benchmark plan will increase on average 7.5 percent in 2016.
For those consumers who live in 30 of the largest markets
representing more than 60 percent of total enrollment, the average
increase in premiums for the benchmark plan is 6.3 percent for the
second-lowest cost silver plan. These increases do not take into
account advanced payments of premium tax credits, which lower the
monthly costs for the overwhelming majority of Marketplace
consumers.
About 8 in 10 individuals who selected a 2015 Marketplace plan
qualified for financial assistance, and the average advanced premium
tax credits for those enrollees who qualified for financial
assistance was $270 per month. Based on a new HHS analysis, nearly 8
in 10 of returning Marketplace consumers will be able to buy a plan
for $100 or less in monthly premiums after tax credits in 2016. In
addition, about 7 in 10 returning Marketplace consumers will be able
to buy a plan for $75 or less in monthly premiums after tax credits
in 2016.
“For most consumers, premium increases for 2016 are in the single
digits and they will be able to find plans for less than $100 a
month,” said Kevin Counihan, CEO of the Health Insurance
Marketplaces.
The second-lowest cost silver plan is notable because it serves as
the benchmark plan to calculate the amount of advanced premium tax
credit consumers may be eligible for to help lower the cost of their
Marketplace coverage. Looking across all “metal levels” of plans
available, silver plans are the most popular plans on the
Marketplace. About 70 percent of consumers enrolled in silver plans,
with approximately 11 percent of all consumers enrolled in the
second-lowest cost silver plans in 2015.
Returning Consumers Who Shop Save Money
When Open Enrollment begins on November 1, consumers will be
encouraged to visit HealthCare.gov to browse their coverage options
to find the plan that best meets their budget and health needs.
Last year, almost 53 percent of consumers who re-enrolled in a
Marketplace plan shopped around with more than half of those
selecting a new plan. The average consumer who switched plans saved
money on his or her net premium, based on a forthcoming HHS analysis
of Open Enrollment in 2015. Net premiums are premiums minus the
amount of applicable tax credit – the amount that is paid by a
consumer. Those who switched plans within the same metal tier saved
an average of nearly $400 on their 2015 annualized premiums after
tax credits as compared to those who stayed in their same plans.
“If consumers come back to the Marketplace and shop, they may be
able to find a plan that saves them money and meets their health
needs”, according to Counihan. “Last year, over half of re-enrolling
consumers on HealthCare.gov shopped and half of those who shopped
selected a new plan – that sort of choice and competition was
limited prior to the Affordable Care Act.” Premium spending for
consumers in the benchmark plans also are capped based on their
income, so a returning consumer who chooses this year’s benchmark
plan may offset any potential rate increase. Additionally, advanced
premium tax credits adjust with the cost of benchmark plans, so
consumers who choose the benchmark plan will see an increase in
their tax credits that roughly matches their premium increases. This
illustrates why it’s important for consumers to shop – no matter
what type of plan they have.
State-by-State Final and Proposed Rate Changes
The overall average rate increase of 7.5 percent is based on the
benchmark plan for all counties in the 37 states that used the
HealthCare.gov platform in 2015. Premiums in the other states have
been and will be released by the individual State-based
Marketplaces.
 Rating decisions are specific to each state and the dynamics of
their market. Due to competition, the issuer offering the benchmark
plan can change year to year. For 2016, over two thirds of counties
will have three or more issuers.
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Table 1 below provides the 2016 benchmark plan rates for each state
that uses HealthCare.gov. It also includes the number of consumers
who made plan selections at the end of open enrollment in 2015.
Table 2 below provides the same information for the 30 largest
markets, which represent more than 60 percent of total enrollment.
PDF Links:
Table 1:
State Average Change in Premiums
Data Source: CMS analysis of finalized rates for 2016 coverage,
reported to CMS as of October 19, 2015.[2]
Table 2:
Market Average Change in Premiums
Data Source: CMS analysis of finalized rates for 2016 coverage,
reported to CMS as of October 19, 2015.[3]
NOTES
Affordable Care Act’s Rate Review Process: On June 1, 2015, CMS
publicly posted health insurance companies’ proposed rate increases
of 10 percent or more for the 2016 coverage year as part of its
commitment to transparency and robust rate review. Proposed rate
increases were submitted by health insurance companies for health
insurance plans inside and outside the Health Insurance Marketplaces
in all states using the HealthCare.gov Marketplace enrollment
platform and some State-based Marketplaces. CMS has posted these
proposed increases to the rate review site at
RateReview.HealthCare.gov.
The rate review process allows for officials, experts, and the
public to examine and question why a particular health insurance
plan’s yearly premium increase is 10 percent or greater and evaluate
whether proposed rate increases are based on reasonable cost
assumptions before it is finalized. Because of the rate review
process and increased competition in the Marketplaces, proposed
rates often change before becoming final. In some cases, state
Departments of Insurance increased rates and in others they were
lower, but in both cases the power of rate review was an important
factor in keeping the market stable.
The rate review process is designed to improve the accountability
and transparency of the process by which insurance companies set
premiums. The Affordable Care Act improved this process by requiring
insurance companies to publicly justify proposed rate increases –
established in regulations as 10 percent or more – in an
easy-to-understand format. RateReview.HealthCare.gov will show the
final 2016 rate increases of 10 percent or more for all states using
the HealthCare.gov enrollment platform. State insurance regulators
operating effective rate review programs are also required to
publicly display these materials (or refer consumers to CMS’
website) and have a mechanism for receiving public comments on those
proposed rate increases.
Consumer Choice in the Marketplace: Marketplace consumers do
not have to stay in their same plan; they have options when they
purchase their coverage. In 2015, 29 percent of all HealthCare.gov
consumers who re-enrolled in coverage shopped and chose different
plans.
Second Lowest Cost Silver Plans: The second lowest cost
Silver plan offered in a consumer’s area is often referred to as a
“benchmark plan” because it is used by the IRS to calculate advanced
premium tax credits. The benchmark plan is determined by the portion
of premiums that cover essential health benefits. Often, the total
premium for the benchmark plan is the same as the portion that
covers essential health benefits, but it can differ.
Advance Premium Tax Credits: The amount of the advanced
premium credit is determined based on household income (on a sliding
scale) and the premium for the benchmark plan. Advance premium tax
credits are available to individuals and families with incomes
between 100 and 400 percent of the federal poverty line who purchase
coverage. Households with lower incomes are eligible for bigger
credits.
Rate increases included in this snapshot reflect premiums before
applicable tax credits. For 2015 coverage, the average advanced
premium tax credits for those enrollees who qualified for financial
assistance was $270 per month. More than 8 in 10 individuals who
signed-up for a 2015 Marketplace plan through HealthCare.gov
qualified for an advanced premium tax credit.
Data Sources and Methodology: The 2015 rate information uses
data from the CMS landscape file as of August 2015. The 2016 rate
information relies on data reported to CMS as of October 19, 2015.
The benchmark rates are identified at the county level for
non-smoking consumers. . Consumer plan selections are as of the end
of open enrollment in 2015, including additional special enrollment
period (SEP) activity reported through February 22, 2015. The
national, state, and DMA averages are calculated as total premiums
divided by total consumers with a plan selections. The national
average and the Top 30 DMA average are not calculated using the
state or DMA weighted averages in Table 1 and Table 2.
Footnotes: [1] Rates provided are as of October 19 and
correspond to the data that will be released for window shopping on
October 25. Rates may change ahead of or during Open Enrollment if
plan offerings change.
[2] Note: The benchmark plans are assigned at the county level. The
national average and state average percent changes are calculated by
taking all the premiums for 2015 based on the benchmark available to
the consumer. Total premiums are then divided by the total number of
consumers with plan selections for 2015. The same process is
repeated for 2016. The national and state averages for 2015 are then
compared to those for 2016 for the percent change. As a result, the
national average cannot be calculated using the state weighted
averages in this table.
[3] Note: The DMA averages are calculated as total premiums divided
by total plan selections. The Top 30 DMA average is not calculated
using the DMA weighted averages in this table.
[Illinois Health and Human Services
Office of Public Affairs] |
