As insurers lose on the exchanges, ACA premiums expected to rise

There's no question about it: Insurers have been losing money on the Affordable Care Act exchanges. What will they do to overcome their losses? Some predict they'll increase their premium prices once again, according to The Hill.

The losses, which are partially attributable to insurers setting premiums too low in 2014, have driven some insurers — most recently, UnitedHealth — to drop out of the some of the exchanges altogether.

To counter cost increases, insurers' premium prices have been on the rise. From 2015 to 2016, ACA premium prices rose an average of 8 percent. However, after accounting for tax credits, the average consumer spent 4 percent more ($102 per month to $106 per month).

According to some, the trend isn't about to stop any time soon. "The industry is clearly setting the stage for bigger premium increases in 2017," said Larry Levitt from the Kaiser Family Foundation, according to the report.

Insurers must have their proposals for premium increases approved by state insurance commissioners, which is set to happen over the next few months.

Still, some believe the increases are inevitable. "The market continues to react to the ACA, and we expect another year of increases (some well into the double digits) before rates start to stabilize," wrote Kevin Walters, a spokesman for Tennessee's insurance commissioner, in an email, according to the report.

If prices do increase, the most affected consumers will be the 15 percent of ACA enrollees who don't receive a tax credit.

More articles on payer issues:
AHA to DOJ: Anthem-Cigna merger threatens self-insured market
Butler Health System, Highmark forge new multiyear deal
Bayhealth Medical Center, Highmark BCBS of Delaware in contract dispute

© Copyright ASC COMMUNICATIONS 2020. Interested in LINKING to or REPRINTING this content? View our policies by clicking here.

 

Top 40 Articles from the Past 6 Months