Insurance exchange premiums lower than expected

CMS insurance application simplified, shortened
CMS insurance application simplified, shortened

HealthDay News -- Consumers are likely to find insurance options more plentiful and more affordable than expected in the new Health Insurance Marketplace that goes into effect Oct. 1, according to the U.S. Department of Health and Human Services (HHS).

A new report from the agency suggests that increased competition will drive premiums down, allowing consumers who formerly could not afford quality health insurance to purchase good plans. Most consumers (95%) will be able to choose between two or more different health insurance companies, at premiums about 16% less than originally expected.

There are currently 53 qualified health plan choices available in the 36 states where HHS will fully or partly run the Marketplace. 

When the exchanges go into effect next Tuesday, individuals will be able to compare and choose between health plans and find out if they are eligible for tax credits. Plans will be categorized as gold, silver or bronze depending on the share of costs covered, and young people can opt for a catastrophic plan.

The average premium nationally will be $328 before tax credits, HHS estimates, and about 95% of uninsured people who are eligible for the Marketplace live in a state where their average premium is lower than projections.

Premiums will vary from state to state and by the consumer's income level, but HHS projects about six in 10 uninsured individuals will be able to find coverage for $100 or less per month, taking into account premium tax credits and Medicaid coverage.

"We are excited to see that rates in the Marketplace are even lower than originally projected," Kathleen Sebelius, U.S. Secretary of HHS, said in a statement. "In the past, consumers were too often denied or priced-out of quality health insurance options, but thanks to the Affordable Care Act consumers will be able to choose from a number of new coverage options at a price that is affordable."

Opponents of the Affordable Care Act worry that lower premiums will come at the expense of more limited provider and hospital choices. 

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