A new report has found that every state is at risk of higher than average premium increases in health insurance in 2019.
The report, “Major Indicators of Individual Market Stability Highlight High Premium Increases for States in Coming Years,” believes that these increases are driven by continued policy changes and uncertainty at the federal level.
If the federal government does not address the current health insurance environment, the report estimated premium increases across the country could range between 12% and 32% in 2019. The Covered California-sponsored study also projected a cumulative total increase of between 36% and 94% by 2021.
“The challenges to our healthcare system are threatening to have real consequences for millions of Americans,” commented Covered California executive director Peter V. Lee. “The prospect of 30% premium increases in 2019 and hikes of over 90% over the next three years will threaten the access to coverage for millions of Americans.”
The report also identifies ways to address the risks causing the premium increases.
“We project that a nationwide reinsurance program with annual funding of $15 billion could result in average premium reductions of 16% to 18%,” said Milliman consulting actuary Robert Cosway. “Lower premiums would impact both consumers and the amounts that the federal government pays in the form of tax credits. The marginal cost of the reinsurance program would be much lower than $15 billion when you consider the reduction in the cost of the federal government’s tax credit payments.”
Other solutions proposed include: providing direct federal funding for the required cost-sharing reduction subsidies, increasing spending in federal marketplace states on marketing, and passing state policies to promote enrollment or protect consumers from insurance with huge coverage gaps.