Original post date: October 30, 2013
Article by: Anonymous
Now that October 1 has passed, the online marketplaces for health insurance under Obamacare are open for business. Individuals are free to browse the site and choose any policy available to them after answering some questions and being guided through their options. So far, site traffic has been causing some technical difficulties, and enrollment is less than predicted.
The high cost of the new premiums could be scaring some consumers away. According to a study by The Manhattan Institute, average individuals will face a cost increase of 62% if they’re female, and 99% if they’re male. (Although low-income families will be eligible for subsidies, this study does not consider them since they will only be available to select individuals and families.)
The Manhattan Institute study was conducted by finding the five cheapest plans offered in each state before the exchanges, and comparing them to the five cheapest plans offered on the exchanges. They looked at rates for 27, 40, and 64 year-olds, and men and women. In the majority of states, 27 year-olds will face steep increases. Men and women will both see increasing premiums, but men will face a higher increase. In the previous system, men typically paid less than women, but now their rates are more similar.
Sixteen of the states and D.C. decided to set up their own exchanges, while the remaining 34 left the work up to the federal government. According to the Manhattan Institute study (which looked at 13 of the 16, and D.C.), the states that were eager to set up the exchanges will see premiums increase by an average of 24%. Five of the states see decreasing averages, but nine will face increasing rates. Although many people will receive subsidies, plenty of families fall in the range just above the subsidy cutoffs, but below the income level that would make many of the available healthcare plans “affordable.” Since the subsidies only help very low-income families, higher premiums will penalize the middle class the most.
People in states like Ohio, New York, and Colorado are some of the few seeing lower premiums and health insurance costs since the exchanges opened. A family of four in Denver will be able to pay lower out of pocket costs than before, even with children who have pre-existing conditions. Unfortunately, aside from these states, the majority of people, especially young, healthy individuals, are seeing higher health insurance costs.
Government officials are not alarmed by the low number of people buying insurance plans. The final date to purchase a plan for the 2014 year is March 31, 2014, so people have time to weigh their decisions carefully. Many people are still confused about how to use the new system, so it’s possible that enrollment will pick up in the next few months, especially as people learn about subsidies for which they may qualify.