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Insurers go for the bronze buyers

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The 2015 individual exchange plan price increases might be as much about efforts to attract healthier insureds as they are about moves to boost total premium revenue.

Kev Coleman, an analyst at HealthPocket, has published data supporting on a gap between price changes for rich coverage and bare-bones coverage in an analysis of the new 2015 Patient Protection and Affordable Care Act (PPACA) individual exchange plan rates. The Centers for Medicare & Medicaid Services (CMS) has just posted rate data for the plans to be sold by the exchanges run by the U.S. Department of Health and Human Services (HHS).

Analysts at Avalere Health came up with averages for the HHS-run exchanges and says the average rate for the “second lowest-priced silver plan” — a benchmark used in PPACA exchange subsidy tax credit calculations — will increase an average of 3 percent at the HHS-run exchanges, to $395. At the state-level, in the HHS exchange states, the average changes will range from a decrease of 19 percent in Mississippi, to $413, to an increase of 28 percent in Alaska, to $683.

See also: Iowa: Health claims may also be higher off-exchange

Coleman analyzed the data for all exchanges that will use the HHS exchange enrollment system in 2015.

He believes rates for nonsmokers will fall an average of 12 percent for bronze plans in those states, to an average of about $232 for a 30-year-old, and increase about 20 percent for the platinum plans, to an average of about $415.

For people who are not getting subsidies, a bronze QHP is supposed to cover about 60 percent of the actuarial value of a standard essential health benefits (EHB) package of services. The actuarial value percentages are about 70 percent for a silver plan, about 80 percent for a gold plan and about 90 percent for a platinum plan.

Platinum plans may attract wealthy people who want the best benefits, but they may also attract people with health problems, who know spending more on premiums to cut out-of-pocket spending will pay off.

Some health plan executives have suggested that exchange plan enrollee has been in line with expectations, but the executives also have been talking more about expectations about getting cash payments from the PPACA reinsurance program, which is supposed to help use cash from a fee imposed on all insurance plan enrollees pay the bills of individual health insurance enrollees with catastrophic claims, and from the PPACA risk-adjustment program, which is supposed to use cash from plans with help low-risk enrollees to help plans with high-risk enrollees.

See also: QHP buyers like silver


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