Silver-plated HIX plan participants are helping offer a middle-of-the-road assessment of how the Affordable Care Act is faring. While health care reform advocates point out that these individuals will avoid sticker shock in 2015, critics note that expected price increases still defy a critical objective of the landmark legislation.
The nonpartisan Congressional Budget Office recently released an analysis suggesting that the average premium increase for mid-tier plans, a key ACA benchmark nestled between bronze, gold and platinum coverage, will edge up only about 2.6 percent to $3,900 from $3,800 in 2014. CBO also projects that these premiums will reach $4,400 in 2016 15 percent lower than its 2009 forecast and about $6,900 by 2024.
Reaction to the news was decidedly mixed.
Variables other than plan design could be influential in determining future premiums, according to an article in The Wall Street Journal that also quoted an aide to Senate Minority Leader Mitch McConnell (R.-Ky.) who said health care costs and premiums are still headed north.
Reuters also reported that some health insurance carriers are predicting double-digit premium increases for the public exchanges in 2015 and fear rates could even double in some markets over the next two years. In addition, the news service cited independent analysts estimating that costs could rise 6% to 9% overall, with higher increases expected in states where HIX enrollment hasn’t gained traction.
But predicting health care premiums is no easy feat. “Anecdotal reports to date have been mixed and provide no clear evidence that insurers have been substantially surprised by the health status of their enrollees,” according to the CBO forecast, which the Obama Administration referenced to support its argument that the ACA is working.
The CBO attributed lower-than-expected cost increases to slower growth of medical costs for both the federal government and private sector and expects healthier HIX enrollees in 2015, which could reach 13 million Americans from 8 million in 2014 and swell to as many as 25 million in 2017.
Another factor to consider is narrower networks and lower provider reimbursement rates in HIX plans relative to group health policies. CBO expects that about $165 billion less will be spent on subsidized HIX coverage for lower-income individuals in the coming decade than it projected earlier in the year.
As part of its updated estimates, which include new data and modeling, the CBO and Joint Committee on Taxation staff now project a net cost of $36 billion for 2014 ($5 billion less than the previous forecast) and $1,383 billion between 2015 and 2024 ($104 billion less than the previous figure). The estimates also are based in part on Medicaid expansion.
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