Consumers who buy health insurance on Illinois’ Obamacare exchange for next year will see slightly lower prices, on average, for the most popular plans – but it’s unclear whether the decline in premiums will be enough to keep people buying them.
Starting next year, consumers no longer will face penalties for not buying insurance. They also will have new options, including the ability to use short-term plans, purchased outside the exchange, for a longer period of time. Short-term plans are often cheaper than exchange plans though they may not offer as much coverage.
Most Illinois residents get health insurance through employers or government programs such as Medicare or Medicaid. But this year about 335,000 people in Illinois opted for coverage through the Obamacare exchange. Open enrollment for exchange plans begins Nov. 1.
Rates for the lowest-priced silver plans, which are popular on the exchange, will decrease by 4 percent, on average, next year. Rates for the second-lowest-priced silver plans will drop by 3 percent, on average, according to an analysis by the Illinois Department of Insurance, released Wednesday. Rates for the lowest-priced gold plans will decrease by an average of 6 percent.
The average rate for the lowest-priced bronze plans will rise by 6 percent, on average, possibly as insurance companies anticipate losing customers now that they won’t face a penalty for forgoing insurance, said Jennifer Hammer, director of the state Department of Insurance. Gold level plans pay for higher percentages of yearly medical costs than silver and bronze plans, though they also may have higher premiums.
There are differences between counties.
In Cook County, for example, a 21-year-old nonsmoker could buy a Celtic Insurance Co. silver plan for as low as $287.57 a month for next year, down from $315.33 a month this year.
In Lake County, the rate for the cheapest silver plan for a 21-year-old nonsmoker is slightly higher for next year – $375.68 a month for a Blue Cross and Blue Shield of Illinois plan, compared with this year’s $358.46 a month.
In DuPage County, the least expensive silver plan, a plan from Cigna, will run $330.21 a month, down from $338.97 this year.
Those prices don’t include the tax credits received by most Illinois residents who buy coverage on the exchange. This year, nearly 82 percent of people on the exchange in Illinois qualified for tax credits.
The price drops aren’t unique to Illinois but are a change from a year ago, when insurers hiked prices amid uncertainty at the time over the future of Obamacare, formally known as the Affordable Care Act.
Hammer anticipates that people who receive tax credits will continue to buy exchange plans, but other non-exchange insurance options have emerged that may be attractive to some groups.
Under a rule finalized by the Trump administration earlier this year, consumers will be able to purchase short-term plans for a year – instead of just 3 months at a time – and they can be renewed for as long as 3 years. The plans are typically less expensive than Obamacare-compliant ones but often don’t cover services such as prescription drugs, substance abuse treatment or maternity care.
The Illinois legislature passed bills last session that would have limited the use of short-term plans to 6 months in Illinois, amid concerns about their lower levels of coverage and implications for the individual health insurance market. But Gov. Bruce Rauner vetoed the bills, saying they would have created “barriers to Illinoisans’ access to the health care plans that best fit their needs.”
Illinois consumers may also have the option of purchasing coverage through association plans, in which small businesses, including self-employed workers, can join forces by geography or industry to get health care coverage as if they were a large employer. A Trump administration rule will allow expanded use of those plans.
It’s possible that all of those factors will lead to fewer exchange plan participants next year, which could lead to higher prices on the exchange in future years, said Stephani Becker, a senior policy specialist at the Chicago-based Sargent Shriver National Center on Poverty Law.
Participation on the Illinois exchange is already down slightly – following years of double-digit rate increases, reduced options and a cut in federal funding for advertising and outreach. Last year’s open enrollment period was also cut to 6 weeks, and this year’s window will be about the same.
This year, Illinois is getting $389,216 in federal funds, down from nearly $1.8 million last year, to hire Obamacare workers to help people enroll in health insurance plans.
Illinois is getting a new insurer on the exchange. Quartz is joining the state’s exchange next year, though it will only offer plans in Stephenson, Ogle, Boone and Winnebago counties. The other insurers offering plans are Blue Cross and Blue Shield of Illinois, Celtic Insurance Co., Cigna and Health Alliance Medical Plans.
Blue Cross and Blue Shield will remain the only insurer on the exchange offering a PPO plan, and that option will be offered statewide.
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