Utahns earning too much for federal subsidies could feel brunt of new health insurance rate increases

Health care advocates, remaining Obamacare insurance providers and the Utah Insurance Department tell state lawmakers that 2018 insurance rate hikes could hit some Utahns hard.

Uncertainty over federal health insurance subsidies for deductibles and copayments under Obamacare will inflate premiums rates for many Utahns next year, especially those who don’t qualify for the benefits.

Utahns who buy their coverage through the Affordable Care Act’s Silver-level individual marketplace plans will see substantial increases in premiums in 2018, according to an analysis from the nonprofit Utah Health Policy Project — some by as much as 63 percent.

Nearly half of that increase, officials have said, stems from the state’s two remaining Obamacare insurance providers – Intermountain Healthcare’s SelectHealth and the University of Utah Health Plans – estimating next year’s rates based on the assumption that federal assistance for deductibles and copayments wouldn’t be funded by Congress.

Some Utah residents will be insulated from the projected hikes thanks to separate federal premium assistance that helps offset those costs. But that’s a cushion that roughly 25,000 state residents won’t enjoy because their incomes are too high to qualify, said Jason Stevenson of UHPP.

“Those Utah consumers who earn too much to receive monthly subsidies will face higher premiums mostly due to the deliberate policies of confusion and sabotage being practice in Washington DC,” Stevenson said, referring to actions by the Trump administration to undermine Obamacare.

The Salt Lake City-based group, which advocates for wider access to health care, presented its findings to state lawmakers Wednesday during a meeting of the Legislature’s Health Reform Task Force.

UHPP, along with officials from the Utah Insurance Department and representatives from Utah’s two remaining Obamacare insurance providers, offered recommendations on what might help stabilize insurance markets amid ongoing turbulence and the limited time before open enrollment begins.

On average, premiums will increase nearly 40 percent in 2018 for Utans receiving coverage under Obamacare, according to data from the Utah Insurance Department. Along with uncertainty tied to federal funding, experts say rising costs of health care and prescription drugs and Congress’ several attempts to repeal and replace the ACA are driving rates upward.

Statewide, the cost of enrolling in Silver plans will increase anywhere from 55 to about 63 percent, according to analysis submitted to the task force Wednesday. In Salt Lake County, premiums on those plans will riseeby about 61 percent, the analysis found.

Though three-quarters of 200,000 Utahns who get their insurance through Obamacare’s insurance exchanges buy Silver plans, Stevenson said the vast majority of them won’t feel the increases full force, as many are in lower income brackets and qualify for financial assistance with their premiums. But that isn’t the case, he said, those who don’t qualify for premium subsidies — Utahns earning over 400 percent of the federal poverty level, or about $97,000 yearly for a family of four.

Meanwhile, Jaak Sundberg, health actuary for the state Insurance Department, said spiking costs for Silver plans could also make the ACA’s Bronze and Gold plans more attractive for some customers when enrollment opens again Nov. 1.

State officials urged Utahns to shop carefully for their insurance plans in light of these shifts. Assistant Insurance Commissioner Tanji Northrup encouraged affected residents to “work with an insurance professional to determine what is the best scenario for them to stay on the exchange or go off the exchange depending on their financial needs.”

Officials with Intermountain Healthcare’s SelectHealth and the U. Health Plans, meanwhile, are urging state legislatures to consider returning to high-risk pools, which allow them to group patients with high medical costs into separate insurance pool and charge them more, while keeping rates lower for healthier patients.

As the Nov. 1 deadline for opening enrollment approaches, Sundberg advised lawmakers to prepare for all scenarios, including the possibility that Congress will continue to pay for the ACA’s deductible and copayment subsidies.

“Once we get into open enrollment,” he added, “it becomes very tricky.”