Early exchange plan rates requested by insurers in several states suggest massive premium hikes may be a thing of the past.
In Washington, for example, 13 payers that intend to participate in the state’s Affordable Care Act (ACA) markets have filed a “record low” average of under 1%, Washington’s Office of the Insurance Commissioner announced.
There will be at least one insurer participating in all 39 counties, according to the announcement, leaving no bare counties.
“This year’s filings are evidence that our full adoption of the law and the steps we’ve taken to defend and preserve it are stabilizing our market,” Insurance Commissioner Mike Kreidler said. “We have more work to do to lower the cost of healthcare and to help lower out-of-pocket costs, but these proposed rates are welcome news.”
Other states where rates have already been filed include Maryland, where the average requested increases declined by nearly 3%. Requested rates are pending a review from state insurance regulators and public comment and could be lowered before being finalized.
Insurers in Vermont have requested hikes of about 13% for the combined individual and small group markets, and New York insurers have requested increases of about 8.4% on the individual markets and 12% on the small group markets.
That stands in stark contrast to other recent years. For example, in Maryland, some insurers requested as much as a 91% increase in premiums for 2018. Overall ACA premiums dipped for the first time in 2018, by 1.5% on average nationwide for silver plans.
What’s behind the changes? After massive hikes in recent years, insurers are finally making money on the ACA exchanges. A recent study from the Kaiser Family Foundation shows ACA plans saw their best financial results ever in 2018.
Individual member per month margins reached $166.82 in 2018, according to the study. In 2015, insurers lost on average $9.21 per member per month.
The Urban Institute also predicted increasing stability in the insurance markets as premium increases declined for 2018. In addition, there was less political upheaval in 2018 compared to 2017, making the markets more attractive, the researchers said.
Looming over all of this, however, is the fate of the ACA itself, which is in question after a Texas judge declared the law unconstitutional in December. Experts said insurers were likely considering the ongoing case—which is currently on appeal—when filing rates, but that the threat of an ACA repeal has been very real for a long time.