Ohio could end up with a highly competitive health insurance exchange program, but regulators say the cost of the coverage sold could be expensive.
State regulators turned in paperwork on Patient Protection and Affordable Care Act (PPACA) exchange plans Wednesday.
The U.S. Department of Health and Human Services (HHS) will be running a “federally facilitated exchange” (FFE) program in Ohio.
The individual exchange attracted applications from 12 insurers, and the state’s Small Business Health Options Program exchange attracted applications from six insurers.
The insurers want to sell a total of 200 plans through the individual exchange and 184 plans through the SHOP exchange.
The federal government must still sign off on the plans.
The number of plans available to consumers will differ by region, the insurance department said. But small businesses should have two to three plans to pick from while individuals could choose from at least four plans.
But officials said they expect buyers of individual coverage to pay an average of 41 percent more for their monthly premiums in 2014 than they would have paid for comparable coverage in 2013.
Small businesses can expect their monthly rates to rise an average of 18 percent, officials said.
The increases are partly due to consumers receiving more benefits under the plans than previously available and new PPACA underwriting rules.
PPACA is supposed to require insurers to sell all individual coverage on a guaranteed-issue basis. Today, some Ohio residents with health problems cannot get commercial health insurance at any price.
The details from the Ohio Department of Insurance were the first glimpse from the state of what consumers could see should they purchase private insurance in the PPACA marketplaces.
PPACA offers sliding-scale tax credit subsidies based on income for individuals and families making up to four times the federal poverty level, about $44,700 for singles, $92,200 for a family of four. But the state’s figures don’t take into account any subsidies that people could get.
Ohioans currently pay an average monthly rate of $236.29, according to the state’s analysis of premiums. Next year in the exchange, individuals would pay an average premium of $332.58.
The state also expects that small businesses will pay an average monthly rate of $401.99 next year in the small group market, up from $341.03 now.
Ohio’s insurance department said it came up with PPACA cost effect estimates by taking the average of premiums for all plans sold in the state at the end of 2012 and compared that figure to the average premium for all of the plans expected to be in the exchange next year.
The co-chair of a coalition of unions, consumer advocates and faith-based groups that back the federal law accused the Kasich administration of “playing with numbers.”
Cathy Levine, of the Ohio Consumers for Health Coverage, said people have been paying lower rates in part because those with pre-existing conditions, who are more costly to cover, have been shut out of the market.
“We’re just spreading the cost more fairly now,” she said.
Lt. Gov. Mary Taylor, the state’s most vocal critic of PPACA, told reporters on a conference call that the agency’s comparison was fair.
Taylor, who is also the state’s insurance director, said Ohioans today can pick what they want in a plan based on their need and what they can afford. Next year, all plans in the exchange will have to cover a standard set of benefits, such as emergency room treatment, maternal and newborn care, and prevention.
“It’s squeezing the market,” she said. “Everyone is being forced to purchase an insurance plan that has these required benefits.”
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