Sebelius Predicts Rise in Health Insurance Premiums in 2015

HHS Secretary Kathleen Sebelius told the House Ways and Means Committee yesterday premiums will likely increase in 2015 under the Patient Protection and Affordable Care Act, according to a report from The Hill.

However, she also told committee members the growth rate will likely be slower than what the country has seen since 2010. Experts have said it's too soon to tell whether the PPACA's marketplace reforms will slow cost growth, according to the report.

There has been some concern that without an adequate amount of "young invincible" enrollees, the total amount of premiums health insurers collect for exchange plans will be less than the total healthcare expenses of exchange enrollees, and insurance companies could increase premiums to compensate. Of the 4.2 million people who enrolled in exchange plans through March 1, 25 percent are between the ages of 18 and 34, according to HHS. However, a report from the Kaiser Family Foundation found a premium "death spiral" is unlikely to occur, and insurers can still expect to earn profits even if only 25 percent of exchange enrollees are young adults. 

A study released in January by global consulting firm PwC found 2014 premiums for health plans offered through the exchanges are comparable to, and in some cases lower than, premiums for employer-sponsored policies offering similar coverage. The report compared published health insurance exchange premiums with the average premium for a single worker with employer-sponsored coverage (based on 2013 data from the Kaiser Family Foundation). Median annual premiums for silver ($4,742), gold ($5,631) and platinum ($6,058) exchange plans are all less than the average employer premium ($6,119), according to PwC.

More Articles on Health Insurance Premiums:
CMS Estimates PPACA Could Raise Premiums for 11M Employees  
Study: PPACA, Employer-Based Health Insurance Premiums Similar  
4 Key Observations on Health Insurer Rate Increases 

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