Proposed Insurance Rates for Health Care Exchanges Vary Widely
Under the Affordable Care Act (“ACA”), individuals and small businesses will be able to purchase health insurance through online exchanges. Although large employers are supposed to provide insurance coverage to their workers under the ACA, there has been concern that some employers will not offer coverage and will simply tell their workers to buy insurance through the exchanges. Some employers have threatened to drop insurance provided through the multiemployer trust funds in favor of sending workers to the exchanges.
This threat has been hard to evaluate, since it is not clear how much insurance will cost through the exchanges. A few states have started to provide data on this question, and the early evidence suggests that the exchanges will span a wide range of prices. The Oregon Division of Insurance recently published the premium rates that insurers proposed for 2014, which showed a huge range of prices, even after accounting for variations based on age or location of the individual.
The Department of Insurance has not approved these rates, so they may change before the exchanges go live. Additionally, some insurers have requested to lower their rates, after realizing the cost range. Finally, some analysts have suggested that insurers may be artificially lowering their rates in order to get more customers during the first year of the exchanges, and intending to raise rates in the future.
Maryland, Rhode Island, and Vermont are also publishing proposed rates for the exchanges. In California, individuals can calculate their expected premium on Covered California based on income and household size, which will also include potential subsidies for those individuals who qualify.
For more information on health insurance exchanges and the ACA, please contact your Trust Fund counsel.
By Daniel S. Brome