HHS: Average Health Insurance Exchange Premium 16% Lower Than Expected

Premium rates for health plans offered through state exchanges under the Patient Protection and Affordable Care Act will be more than 16 percent lower than projected, according to an HHS report.

HHS analyzed health insurance premiums for the 36 states in which HHS will support or fully facilitate exchanges and the 11 states and the District of Columbia that will run their own marketplaces. According to the report, 95 percent of consumers will have a choice of two or more health insurance issuers, and the same percentage live in states with average premiums below previous estimates. In states where HHS will fully or partly run exchanges, individuals will be able to choose from an average of 53 qualified health plans.

Before factoring in tax credits, the weighted average of the second-lowest-cost silver plan in 48 states is lower than a Congressional Budget Office estimate of $392 per month. In 15 states, consumers will pay less than $300 per month for the second-lowest-cost silver plan, according to HHS.

Additionally, the report found states with the lowest average premiums tend to have a higher number of insurers participating in their exchanges, suggesting competition drives down costs. States with premiums in the lowest quartile have an average of eight health insurance providers participating in their marketplaces, while those with the highest premiums have an average of three.

Furthermore, after factoring in federal subsidies available to help people buy coverage, 56 percent of uninsured Americans could pay less than $100 per person per month for health insurance through the marketplaces, Medicaid or the Children's Health Insurance Program, according to HHS.

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