Starting October 1, federally run “marketplaces” under the Affordable Care Act (ACA) under Obamacare will roll out in 36 states. Today we just received our first preview of the health insurance premiums that will be offered in the federally-run health care exchanges.
The report from the Department of Health and Human Services uses the example of a healthy 27-year-old. This consumer would pay $163 /mo, on average, for the basic ‘bronze’ plan and $240 a month for ‘gold’ coverage a more comprehensive plan.
“If you’re a 27 year-old young woman, you’re going to be able to purchase high-quality health insurance for less than the cost of your cellphone bill,” President Obama said Tuesday.
For a family of four with an annual income of $50,000, the administration said, monthly premiums for the second-cheapest plan will vary widely, averaging $600 in Arizona, $800 in Georgia, $961 in Indiana, $1,069 in Mississippi, $859 in New Hampshire, $943 in New Jersey and $656 in Utah.
“I’m actually surprised they’re coming in so well. They’re very competitive and they definitely will save consumers money,” JB Silvers is a professor of Healthcare Finance at Case Western Reserve’s Weatherhead School of Management
The primary reason for the low rates is the competition among health insurance providers, said Silvers, because insurance companies “have looked at this big block of new business and found it irresistible.”
However, the plan still has critics. Men will pay nearly double what they would for coverage and young women as much as 50% more. The ideas is that healthy, younger adults will help subsidize people who have pre-existing conditions and wouldn’t be able to get coverage otherwise.