NCPA - National Center for Policy Analysis

ObamaCare Premiums Will Vary Widely

September 11, 2013

The premiums for coverage available on the health insurance exchanges created by President Barack Obama's health care reform law will vary widely from state to state, according to a new Henry J. Kaiser Family Foundation analysis of data published by 17 states and the District of Columbia, says the Huffington Post.

Retail prices for health insurance can be considerably different based in part on the cost of health care services where a person lives, even within the same state.

  • In Baltimore, a 40 year old will be able to buy a so-called bronze health insurance plan for as little as $146 a month compared to $336 a month in Burlington, Vt.
  • Most legal residents of the United States must obtain coverage or face a tax penalty under the law's individual mandate.

The health insurance exchanges in all 50 states and the District of Columbia are slated to open Oct. 1 for small businesses, uninsured people and for people who don't get health benefits at work, to comparison shop and to learn whether they qualify for financial assistance.

The exchanges will sell four tiers of health insurance -- bronze, silver, gold and platinum -- indicating how generous the coverage is.

  • Bronze plans will tend to have the lowest premiums, but expose consumers to the highest possible out-of-pocket costs.
  • Platinum plans will have the highest prices but the lowest additional expenses.

The Kaiser Family Foundation didn't compare the premiums on the health insurance exchange with the cost of health insurance for those who don't get health benefits at work today, however. The new law's guaranteed benefits -- prohibition against turning down people with preexisting conditions -- will make health insurance on this market too different from what's currently available, the report says.

"These changes make direct comparisons of exchange premiums and existing individual market premiums complicated, and doing so would require speculative assumptions and data that are not publicly available," it says. Some people, most likely young adults who don't qualify for financial assistance, may see higher prices as a result.

Source: Jeffrey Young, "ObamaCare Premiums Will Vary Widely By State and City: Report," Huffington Post, September 5, 2013. Cynthia Cox, Gary Claxton, Larry Levitt and Hana Khosla, "An Early Look at Premiums and Insurer Participation in Health Insurance Marketplaces, 2014," Kaiser Family Foundation, September 5, 2013.


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