Consumers enrolled in exchange plans who receive federal assistance to reduce their monthly premiums may face substantial premium increases unless they switch insurance plans in 2015, according to a new study from Avalere Health.
For the study, Avalere researchers examined preliminary rate filings in nine states:
"Most enrollees in 2014 chose a plan based on the monthly premium," said Elizabeth Carpenter, director at Avalere Health, in the report. "However, the lowest cost plans in 2014 may no longer be low cost in 2015."
The study found the competitive landscape for plans is changing in 2015. However, consumers' premium subsidies are tied to the benchmark plan and a percentage of income, and consumers are required to pay the difference if they enroll in a plan that is more expensive than the benchmark.
The Patient Protection and Affordable Care Act offers four types of health plans: bronze, silver, gold and platinum. The platinum plan is the most expensive, while the bronze plan is the least comprehensive plan in terms of services covered. The second-lowest priced silver plan available within an exchange in a state is called the benchmark plan.
The study found the second-lowest cost silver plan in six of the nine states would lose benchmark status next year, while the lowest-cost silver plan in seven of the nine states would no longer be the lowest-cost option in those states next year.
Therefore, those receiving federal premium subsidies may need to switch plans in 2015 to avoid paying more than the limits established by the Patient Protection and Affordable Care Act.
"Before consumers renew their 2014 plan, they should consider the tradeoff between continuity of care and lower monthly premiums," said Ms. Carpenter.
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