Amid rising premiums, health insurance subsidies keep pace

Minneapolis, MN – Despite rising premiums, the continued affordability of Affordable Care Act health plans this open enrollment period will likely continue to fuel record-high enrollment in ACA plans, healthinsurance.org said today.

“We’re seeing mostly single-digit rate increases in most states for 2023,” said Louise Norris, health policy analyst for healthinsurance.org. “And subsidy enhancements will continue next year – excellent news for the estimated 13 million people whose coverage is made more affordable by these subsidies.”

Consumers only have from Nov. 1, 2022 until Jan. 15, 2023 in most states to participate in the open enrollment period (OEP). And in most states, you’ll need to enroll by December 15 in order to have your coverage take effect at the start of 2023.

Premiums rise, but subsidies keep pace

Across roughly half of the states, the average rate change for 2023 amounts to just under a 7% increase, according to ACASignups.net.

“Final rates aren’t yet available in some states, but we’re generally seeing final rates that tend to be a bit lower than the insurers proposed,” Norris says.

As always, if the cost of the second-lowest-cost silver plan increases, subsidies in that area will also increase. And the Inflation Reduction Act, which was enacted in August, ensures that the American Rescue Plan’s subsidy enhancements will continue next year. That means subsidies will continue to be larger than they were prior to 2021, and more widely available. Subsidies continue to be income-based, but without the specific income limit that applied prior to 2021.

Also, the IRS has finalized a rule change that fixes the “family glitch.” Under the old rules, a family with an offer of employer-sponsored coverage could not qualify for premium subsidies in the exchange if the employer’s plan was considered affordable for just the employee alone – regardless of how much it cost to add the family to the plan. Under the new rules, there will be a separate affordability determination for the family’s coverage under the employer’s plan. If it’s not affordable, the employee’s family members can potentially qualify for a premium subsidy in the exchange. This will present new options for some families who have long struggled with unaffordable employer-sponsored health coverage.

“The main point to keep in mind here is that it’s important to double check your marketplace options this fall – even if you looked in the past and weren’t eligible for subsidies due to an offer of employer-sponsored coverage,” said Norris.

Several insurers are joining exchanges in the following states for 2023:

• Ambetter/Celtic (Alabama)
• Cigna (Texas, Indiana, and South Carolina)
• Ascension Personalized Care (Alabama, Tennessee, and Texas)
• Aetna (Delaware, California, Illinois, New Jersey)
• UnitedHealthcare (Kansas, Mississippi, Missouri, Ohio)
• CareSource (North Carolina)
• AmeriHealth (Delaware)
• Taro Health (Maine)
• Blue Cross Blue Shield of Nebraska (Nebraska)
• Moda Health (Idaho)
• Luke’s Health Plan (Idaho)

But there are also some insurers exiting the marketplace in several states, including:

• Oscar Health is exiting Arkansas and Colorado, but remaining in nine other states.
• Bright Health is exiting the individual/family market in all 17 states where they currently offer these plans, resulting in approximately 1 million exchange enrollees needing to select new plans. (It’s possible, however, that Bright Health might continue to offer “an immaterial amount” of individual market plans in some states.)
• Friday Health Plans is exiting the on-exchange market in Texas, but will continue to offer off-exchange plans in Texas. Friday has not announced any exits in the other states where they offer plans in the exchange.

“For the last several years, the general trend has been toward increased insurer participation in the exchanges, and this year is no exception,” Norris said. “Even in states where the participating insurers will be the same, there may be service area changes that could result in an insurer’s plans becoming newly available in some areas, or no longer available in others It’s important to compare your available plan options, as opposed to just letting your existing plan auto-renew.”

If your health insurer is leaving the market, it’s especially important to compare the available options for 2023 and pick the replacement plan that best fits your needs.

Find more detailed information about open enrollment in healthinsurance.org’s ACA Open Enrollment 2023 Guide.

Healthinsurance.org provides free, online resources for consumers, including information about individual health insurance, major medical insurance and affordable medical insurance.

Contact:

Amy Fletcher Faircloth [email protected]