Health insurance premiums across 15 states and the District of Columbia will fall in 2015, a new study from the Kaiser Family Foundation finds. The analysis, which examined the second-lowest cost silver plan in the marketplaces, concludes that subsidy-eligible individuals “whose income does not change will generally pay a little less to enroll in the second-lowest cost silver plan in 2015 than they did if they enrolled in the second-lowest cost plan in 2014.”
Silver plans cover approximately 70 percent of enrollees’ health expenses on average.
The results are significant because in 2014, sixty-five percent of enrollees signed up for a silver-level policy, and the coverage is “generally the least expensive option someone without employer-based coverage can choose to satisfy the ACA’s requirement to have insurance or pay a penalty,” according to the report.
“[A]cross the 15 cities we examined, the premium for the second-lowest-cost silver plan in the marketplaces — before taking any income-related tax credits into account — is decreasing by an average of -0.8%,” authors Cynthia Cox, Larry Levitt, Gary Claxton, Rosa Ma, Robin Duddy-Tenbrunsel conclude. This finding cut against predictions of double or triple digit increases by Republican lawmakers eager to tear down the law.
The authors attribute the premium decreases to stronger competitive forces in the exchange marketplaces — more insurers choosing to offer health care coverage — and the expectation that healthier beneficiaries will enroll in 2015. However, health care premiums will vary across the country — and across the nation’s 500 rating areas — meaning that some customers could experience increases. One analysis of available data from PricewaterhouseCoopers predicts an average increase of 8.2 percent in 29 states and Washington D.C.
The report comes in the wake of a Congressional Budget Office analysis from April, which found that premiums for Obamacare coverage are lower than the federal government had anticipated. As a result, the office estimated that that the law will cost the government $5 billion less than projected in 2014 and $104 billion less for the 2015–2024 period. The cost could decrease even further in 2015, since the law’s tax credits are tied to the second-lowest-cost silver plans.
The second enrollment period begins on Nov. 15. The CBO projects that 13 million people will sign up for coverage.