Although premiums from plans sold through the Affordable Care Act’s health insurance exchanges are set to increase an average 7.5% next year, some industry experts believe the jump may be less surprising than people think.
Indiana is supposed to see the largest projected rate increase at 15.4% based on preliminary data from PricewaterhouseCoopers’ Health Research Institute. Despite their expected increases being the highest in the United States, Susan Rider National Media Chair for the National Association of Health Underwriters and Account Executive/Human Capital Consultant at Gregory & Appel Insurance in Indiana, explained clients have been advised to expect the spike.
“I think that from a group perspective we already advised our clients last year when they did their renewals to budget at least 15 to 20%. So it should not be much of a surprise,” said Rider.
Individual coverages should not be blindsided by the increases either.
She continued, “The other thing a lot of those folks needed was a different formulary list based on the medications that they need. That’s one reason why they went outside. So they are also anticipating an increase.”
In Iowa, projected at an 11.5% increase according to PWC, it appears there is more variety in the effects of premium rates.
“David Lind does a study here in Iowa that is about to come out in the press this week and in that he is projecting about a 6.9% increase in the Iowa employer based coverage. So I would say we’re looking at closer to a 7% increase,” explained Jesse Patton, President of the Iowa Association of Health Underwriters. “I have about 25 renewals for December and they are ranging from -35% to a 44% increase, but the majority of them are 2% or below that. Probably half of the renewals are actually a negative.”
Questions have been raised about the validity of the statistics published in the recent PWC study, most notably in North Carolina where an earlier version of the report showed a 10.8% increase, but has now been updated to 7.7%.
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