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State Releases Individual and Small Group Insurance Rates; Individual Rate Increases Reflect Federal Elimination of CSR Payments

October 16, 2017

The Pennsylvania Insurance Department has released the final 2018 rates for individual and small group health insurance products that comply with the reforms of the Affordable Care Act (ACA).

The average increase in rates for individual health insurance products offered to Pennsylvanians on the ACA's Health Insurance Marketplace is 30 percent higher than last year’s rates. This increase resulted from the impact of the Trump Administration’s decision to cease cost-sharing reduction (CSR) payments. 

According to the Insurance Department, the individual market would have been more stable had the CSR payments continued. The average rate increase would have been just 7.6 percent.

In contrast, the average rate increase for the small group market was much lower (7.6%).

The Insurance Department has posted explanations for each plan’s rate increases. The department noted that it “allowed insurers to adjust their rate filings to reflect the uncertainty related to the CSR funding,” particularly for silver plans offered on the marketplace, as these were the only plans for which CSR payments were available.

Most (80%) of consumers who get their insurance through the marketplace are eligible for tax credit subsidies. These consumers will receive additional federal tax credit subsidies to cover the cost of higher premiums. As a result:

  • Insurance premiums will still be affordable
  • Federal deficit spending for the additional tax credit subsidies will increase

However, consumers who purchase silver plan coverage through the marketplace, but who do not receive subsidies, should shop carefully. The Pennsylvania Insurance Department is encouraging these individuals to consider all their options. Off-exchange health plans or marketplace bronze or gold plans will likely have lower rate increases. 

To determine what might be available, and to estimate monthly premiums and total annual costs, consumers can use the department’s plan comparison tool

The five health insurers offering coverage on the marketplace—Capital Blue Cross, Geisinger Health Plan, Highmark, Independence Blue Cross, and UPMC Health Plan—are all offering assistance to consumers as they sort through the changes for 2018. 

This year’s open enrollment is much shorter—November 1 through December 15. HAP is encouraging hospitals and health systems to make sure their insurance outreach and enrollment staff have the detailed information they may need to help educate consumers. This includes understanding which health plans and options are being offered in each county both on the marketplace and off.

Pennsylvania’s uninsured rate is at its lowest ever—5.6 percent. HAP is working with member hospitals and health systems, the five health insurers, navigators, community health centers, consumer advocates, and the Pennsylvania Insurance Department to inform consumers about:

  • The timeline for open enrollment
  • The health insurance options available

For more information, contact Jolene Calla, HAP’s vice president, health care finance and insurance, or Paula Bussard, HAP’s chief strategy officer.

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