Amid the uncertainty about the future of the Affordable Care Act and the health care coverage it provides, even more people signed up for coverage during this year's enrollment period than during last year's.
And despite the exit of many insurers from marketplaces across the country, rate hikes — while substantial in some areas — were by no means as large as consultants expected to see. Nor were they as costly to insureds as might have been expected, since along with the rise in premiums came a rise in subsidies.
That means that many shoppers for insurance coverage were actually pleasantly surprised by their end costs.
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NPR and Kaiser Health News reported that despite concerns over what might happen to ACA coverage next year under a Republican Trump administration, 400,000 more people signed up during the open enrollment period than did so last year — bringing the total to 6.4 million for this year's enrollment period. And for those who qualified for subsidies to pay for that coverage, the news wasn't all bad.
Although lots of insurers have bailed on the program, withdrawing from marketplaces to such a degree that approximately a third of U.S. counties now have just a single insurer offering coverage for 2017, the lack of competition has not seen a rise in premiums to a corresponding degree.
In fact, the report says, more than 80 percent of the nearly 13 million people who enrolled for coverage on the marketplace last year qualified for subsidies. Subsidies are pegged to the price of the second-lowest silver premiums, so that when silver plan costs rise, subsidies go up too.
Consulting firm Avalere Health found that premiums did not go up as much as expected. This was despite the fact that, according to a Kaiser Family Foundation analysis, in 2015 only 7 percent of counties had a single insurer offering coverage and now that number is closer to 33 percent.
Why? Probably because, according to Caroline Pearson, an Avalere senior vice president, initial rates had to be filed with regulators before insurers knew the extent to which the competition was dropping out.
"A lack of competition is bad for the insurance market in the long term," Pearson says in the report, "but in counties that have only one plan it hasn't proven to be catastrophic for consumers for 2017. We expected to see the biggest price hikes in areas without competition."
But that hasn't happened. Instead, while prices are rising almost everywhere, they're not significantly higher in areas with a single insurer than they are in areas served by multiple insurers. Next year, however, warned Pearson, it could be a different story.
Sadly, for those who make too much to qualify for subsidies, it's already a different story. Premium hikes accompanied by a drop in choice of plans have delivered a one-two punch that is making millions of people very unhappy. It remains to be seen whether a new administration will change that — or simply make it worse.
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