Healthcare.gov Premiums Are Down, but Are Still Unaffordable for Many

CMS announced that the average premium for the second lowest cost silver plan on HealthCare.gov for a 27 year-old will drop by 4 percent for the 2020 coverage year. Additionally, 20 more issuers will participate in states that use the Federal Health Insurance Exchange platform in 2020 bringing the total to 175 issuers compared to 132 in 2018.

On his first day in office, President Trump issued an executive order on minimizing the economic burden of Obamacare and giving states more flexibility to address problems with their healthcare markets. In response, CMS quickly issued the market stabilization rule in 2017 and then issued further rules and guidance to increase competition, expand choice, lower costs, and give states more control. In addition, CMS has used its authority to issue waivers to approve reinsurance programs in 12 states nationwide, all resulting in lower premiums.

Six states experienced double-digit percentage declines in average second lowest cost silver plan premiums for 27 year olds including, Delaware (20%), Nebraska (15%), North Dakota (15 %), Montana (14%), Oklahoma (14%), and Utah (10%). CMS has used its authority to approve reinsurance waivers in three of these states, including Delaware, North Dakota and Montana, contributing to the decline in premiums.

Even with these positive trends in the individual market, affordability remains a substantial challenge for people who do not qualify for a tax credit and must pay the entire premium themselves. A recent CMS report shows that 2.5 million people who didn’t receive federal premium tax credits left the individual market from 2016 to 2018. This represents a 40 percent drop in just two years and demonstrates the ongoing challenges the individual market still faces.

The Health Insurance Exchange 2020 Open Enrollment Period is November 1, 2019 to December 15, 2019, with coverage beginning on January 1st.

Click here to read the full press release from CMS.

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