PHILADELPHIA - The average cost of health insurance will increase from 6% to 7.5% in 2023, up from 4.4% projected in 2018. The average increase is higher than the 8% to 9% expected for overall inflation. Because health plans typically have multi-year contracts with providers, the impact of price inflation will be phased in over the next few years. Higher reimbursement levels will accompany the price increases for providers. However, employers now have a small window to make changes to keep premium increases from rising dramatically in 2024.
Connecticut Rate Hike
In Connecticut, health care advocates and residents have repeatedly called on state officials to block a substantial rate hike. They also emphasized their concerns about how a rate hike will affect health care access and affordability. One such advocate, Lynne Ide, is the program lead of communications outreach for the Universal Health Care Foundation of Connecticut. She supports legislation that gives the insurance department more teeth to stop rate hikes.
Connecticut residents can expect to see their electric bills rise by at least 3 percent over the next several years. This hike will be less than the current inflation rate, affecting a few categories of a monthly bill. One of these categories is the delivery portion, which includes taxes and other state and federally mandated charges. Rate 1 pricing is the most common residential rate in Connecticut. If approved by the Public Utilities Regulatory Authority (PURA), the rates would take effect on Sept. 1, 2023. The increase would amount to a $3.96 monthly bill for an average residential customer.
Impact of No Surprises Act on premiums
Currently, the impact of the No Surprises Act on health insurance premiums is unclear. Only a few insurers have addressed the impact of the law. Some insurers mentioned the Family Glitch implementation and the No Surprises Act, but none cited any substantial impact on premium growth.
According to a new study, the impact of the No Surprises Act on health insurance premiums is expected to be small. During the second quarter of this year, 19 insurers reported a five to ten percent increase, while 15 insurers predicted increases ranging from ten to fifteen percent. Only one reported a reduction among the eight issuers that reported increases of twenty to twenty percent. Overall, insurers project that premiums will rise between four and eight percent in 2023. This increase is based on rising prices of health care supplies and labor costs associated with the economy.
The No Surprises Act is an important piece of legislation passed to protect consumers from surprise medical bills. Its passage was a result of bipartisan support. It aims to protect consumers from unexpected medical costs, a leading cause of concern for consumers. Federal agencies quickly implemented it.
Impact Of Family Glitch Fix On Premiums
The Family Glitch fix is a proposal to increase Americans' access to affordable health coverage. The proposal would make it easier for spouses and dependents of those earning up to 400 percent of the federal poverty level to find affordable health insurance coverage through the exchanges. The proposed changes will likely lower health insurance premiums by at least $970 annually for families earning the median income.
The proposed rule is available for public comment until June 6, 2022, and an IRS hearing is scheduled for June 27. The fix would provide financial assistance to affected families starting in the 2023 plan year. The proposal will be a long-term fix and will require additional work from federal agencies. The Kaiser Family Foundation and the Urban Institute have conducted studies on the Family Glitch and estimate that up to five million families are affected by the glitch.
Impact Of Covid-19 Pandemic On Premiums
The COVID-19 pandemic has the potential to raise premiums in the near future. However, the impact will be limited, as most insurers forecast that the disease will not affect the individual market much. Premiums in the year 2023 will also likely be affected by the end of the American Rescue Plan (ARP) subsidies. This will likely raise out-of-pocket premiums, especially for healthy enrollees. However, insurance companies are hopeful that Congress will extend these subsidies before the rate-setting process is complete.
Most insurers have mentioned the COVID-19 pandemic in their outlooks for the coming years, but only half have quantified how it will affect premiums. Some say it will have a net neutral effect on premiums, while others predict a moderate downward impact.
Impact Of New York State Of Health Essential Plan On Premiums
The New York State of Health Essential Plan would be a state-sponsored health insurance program covering low-income residents. The plan would cost $345 million annually, including savings from emergency Medicaid offsets, covering 46,000 new enrollees. The State would pay those premiums, which may have to seek a federal waiver to cover this population segment.
The Essential Plan is available to New Yorkers who earn 138 percent or less of the federal poverty level. This plan would lower monthly premiums and reduce out-of-pocket costs for medical services. The Essential Plan's comprehensive benefits include free preventive care and low copayments. Compared to a Qualified Health Plan, it costs about $1100 less. This change could moderate the impact on QHP premiums, but overall, consumers will benefit.
