WASHINGTON • With new health insurance markets launching next week, the Obama administration is unveiling premiums and plan choices for 36 states including Utah where the federal government is taking the lead to cover uninsured residents.
Before tax credits that work like an upfront discount for most consumers, sticker-price premiums for a mid-range benchmark plan will average $328 a month nationally for an individual, comparable to payments for a new car.
Consumers can pick from four levels of coverage, from bronze to platinum, with the big differences appearing in cost sharing features such as annual deductibles and copayments. Bronze covers 60 percent of expected costs; silver, 70 percent, on up to platinum at 90 percent.
In Utah, a 27-year-old will pay $153 a month for the lowest bronze plan, $183 for the lowest silver plan and $212 for the lowest gold plan, according to an overview of premiums and plan choices released Wednesday by Health and Human Services Secretary Kathleen Sebelius.
But that's before tax credits, which will lower costs for most of Utah's 380,000 uninsured. After subtracting tax credits, here's what Utahns will pay for the lowest cost bronze plan:
• A 27-year-old in Salt Lake City earning $25,000: $95 per month.
• A family of four in Salt Lake City with an income of $50,000 per year: $122 per month.
How these prices compare to current rates is hard to say because plans sold on the exchange are held to new standards. They must, for example, cover maternity and behavioral health care. No such mandates exist now in Utah. The average individual monthly premium in Utah was $173 in 2010, according to the most recent data kept by the Henry J. Kaiser Family Foundation.
Consumer choice • Bottom line: tax credits will bring insurance within easier reach of many low-wage and middle-income families. For those who don't qualify for subsidies, it's a toss up.
Utahns will choose from among 97 plans, offered by six insurance companies, when the state's federally run exchange opens Oct. 1, Tanji Northrup, assistant Insurance Department commissioner, told the Utah Legislature's Health Reform Task Force on Tuesday. Six dental insurers will offer another 28 plans.
A report by Sebelius' department estimated that nationwide, about 95 percent of consumers will have two or more insurers to choose from. And the administration says premiums will generally be lower than what congressional budget experts estimated when the legislation was being debated.
All the plans cover the same benefits and cap annual out-of-pocket expenses at $6,350 for an individual, $12,700 for families.
About one-fourth of the insurers participating are new to the individual coverage market, a sign that could be good for competition.
Sebelius stressed the positive in a preview call with reporters. "For millions of Americans, these new options will finally make health insurance work within their budgets," she said
The overview comes as the White House swings into full campaign mode to promote the benefits of the Affordable Care Act to a skeptical public. Congressional Republicans, meanwhile, refuse to abandon their quest to derail "Obamacare" and flirt with a government shutdown to force the issue.
Differences between states • Where you live, the plan you pick, family size, age, tax credits based on your income, and even tobacco use will all impact the bottom line. All those variables could make the system hard to navigate.
The second-lowest-cost silver plan in each state is considered a benchmark, important because tax credits are keyed to it.
The average individual premium for that benchmark ranges from a low of $192 in Minnesota to a high of $516 in Wyoming. That's the sticker price, before tax credits.
In the three states with the highest uninsured population, the benchmark plan will average $373 in California, $305 in Texas, and $328 in Florida. Differences between states can be due to the number of insurers competing and other factors.
"One surprise is Texas," said Larry Levitt of the Kaiser Family Foundation. "That is a state that has put up roadblocks to implementation, but the premiums there are below average."
Factoring in tax credits • The administration report found that factoring in tax credits, a 27-year-old making $25,000 a year would see the premium for the benchmark silver plan drop to $145 in nearly every state.
But if that hypothetical young adult used the tax credit to buy the cheapest bronze plan, he or she could cut the monthly premium to $74 in the Dallas-Fort Worth area, $102 in Orlando, and $119 in Pittsburgh.
For a family of four making $50,000, the tax credit would cut the monthly premium for the benchmark silver plan to $282.
But if the family used its tax credit to buy the cheapest bronze plan, the premium would be $26 a month in Dallas-Fort Worth, $126 in Orlando, and $209 in Pittsburgh.
In the Washington, D.C., metro area, the hypothetical family could find a zero-premium bronze plan, while the lowest an individual could get after applying their tax credit would be $66.
Such differences are sure to leave many people scratching their heads. Officials said they're due to complicated interactions between the tax credits and insurance company pricing strategies in dynamic markets.
Another outside analyst said the administration analysis of premiums is consistent with what the 14 states running their own insurance markets have reported.
Tribune reporter Kirsten Stewart and Ricardo Alonso-Zaldivar of the Associated Press contributed to this report.
Background: The Affordable Care Act
Starting Jan. 1, virtually all Americans will be required to carry health insurance or face fines. In each state, online marketplaces called exchanges will launch Oct. 1, offering plans to the uninsured and connecting qualifying buyers to subsidies.
Find the new analysis of exchange insurance plans from the U.S. Department of Health and Human Services at aspe.hhs.gov, the website of the Assistant Secretary for Planning and Evaluation.