Maybe competition among health insurance plans can lead to lower rates.
As soon as Oregon this week became the fourth state to publicly list health insurers’ proposed 2014 rates for individual and small group coverage, two plans moved to cut their suggested prices, the Oregonian reported Friday. Providence Health Plan and Family Care Health Plans sought to lower their rates when they noticed they were out of whack compared to competitors — five months before the health law’s new online marketplaces even open for enrollment.
What is also clear from the filings is that there’s little sign in Oregon of the major premium hikes that the industry has been warning about for months.
“I don’t see sticker shock in the rates,” said Jim Perucca, executive vice president of Independent Insurance Agents and Brokers of Oregon.
Other states that have made insurers’ filings public show a range of proposed premium changes: In Maryland, CareFirst Blue Cross Blue Shield, the state’s dominant insurer, requested a 25 percent average rate increase for its 2014 individual-market plans. Vermont and Rhode Island officials said the insurers’ proposed rates were close to today’s prices.
In most states, insurers have to submit their policies by the end of May to be included in new marketplaces being run by states and the federal government. Not all states make public the insurers’ submissions.
In Oregon, the filings show that consumers will likely see a wide variation of prices for the same benefits. For example, the premium for a “bronze” style plan for a 40-year-old non-smoker living in Portland ranged from $195 a month at Pacificare Health Plans to $401 at Trillium Community Health Plan.
The two most popular companies—Regence Blue Cross Blue Shield and Kaiser Permanente —proposed prices for a person in the same category of $268 and $222 respectively, according to the state’s website. Those premiums are not that much higher than those on policies the companies sell now, according to prices on http://www.healthcare.gov/.
Starting in October when the new online insurance marketplaces open in every state, consumers can choose from four coverage levels: bronze, silver gold and platinum. The difference among these tiers is their “actuarial” value — how much a plan will cover before the patient must chip in for co-insurance, deductibles and co-payments.
All plans, whether bronze, silver, gold or platinum, will cover certain essential health benefits such as doctors’ visits, emergency care, maternity care and prescription drugs. Some major insurers have warned those benefits — along with rules that prohibit charging people higher premiums due to their health status — will result in much higher premiums.
Regence spokesman Scott Burton said it is difficult to compare plans sold today to those offered in 2014 because so many benefits are changing as a result of the Affordable Care Act. This includes the addition of new consumer protections and coverage requirements. For example, all individual and small group plans must cover pediatric care for children, maternity and newborn care services and substance abuse services. These and other coverage areas are considered “essential health benefits” under the health care law.
Burton said the company’s proposed rates are generally within $50 to $100 of rates available this year.
Along with 16 insurers, two nonprofit consumer-operated plans (CO-OPS) proposed rates in Oregon. You can view all the offerings 0n the state’s full website.
Michael Welch, a Portland, Ore., insurance agent and former president of the Oregon Association of Health Underwriters, said many consumers will be in for so called “rate shock” if they have not bought coverage in the individual market previously.
“There will still be some discomfort when people realize how much the plans cost,” he said.