What will health insurance cost in 2014?

The Affordable Care Act introduces new requirements that will increase the cost of healthcare coverage, with many customers likely to see a higher cost for coverage in 2014. Key factors driving up those costs, before considering the impact of federal subsidies, include:

• More expensive benefits: the ACA requires health plans to sell coverage with more expensive benefits than most customers choose to purchase today.

• Higher medical costs for new customers: an independent analysis shows new customers in the Exchange, including current enrollees in state high risk pools, have more medical needs – and higher claims costs – than today’s customers in the individual market.

• Rating rules: new rules reduce the amount by which health plans can vary rates based on age. From 2014 onwards, older customers will not pay more than 3x the rate that is charged to younger customers. Today, that difference is 3.75. Current older customers with comprehensive benefits may see a rate decrease. Current younger customers with high deductible plans are likely to see large rate increases.

• New taxes and fees: the ACA adds new taxes and fees that will increase costs.

Federal Subsidies
Some customers will be eligible for a federal subsidy to buy Individual coverage, and they may see a net out-of-pocket decrease in what they pay in monthly rates. Some will also be eligible for cost share reductions, reducing their deductible, coinsurance and copays.

Who will be eligible for subsidies? Individuals and families with income up to 400% of the federal poverty level. In Washington, an individual with an income up to $46,000 may be eligible; a family of four with an annual income up to $94,000 may be eligible.

We continue to be concerned about affordability for our customers. It’s important for our clients to determine if they will be eligible for a subsidy. Until actual rates are approved and published you may want to visit the National Calculator site at http://www.wahealthplanfinder.org/calculator/index.html


Return to this blog to see updates on this topic. You can always reach me by email at Richard@ekandek.com or by text 425.478.2000