Study: Individual market premiums far lower with the ACA than without

Despite concerns about increased premiums in 2017, consumers are getting more robust health coverage at a much lower cost in a post-Affordable Care Act individual market, according to researchers with the Brookings Institution.

In fact, marketplace premiums would have to grow 44 percent this year to order to match what individual market premiums would have been without the ACA, researchers write in a post for the Health Affairs Blog.

In many cases, marketplace consumers are getting far more robust plans. On average, the ACA’s benchmark “silver plans” cover approximately 17 percent more healthcare expenses than similar individual plans prior to ACA implementation.   


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Earlier this week, Covered California announced 13.2 percent hike in premiums for 2017, reflecting ongoing concerns that 2017 will bring double-digit premium increases in ACA exchanges across the country.

Researchers found that premiums for silver level plans were actually 10-21 percent lower in 2014--during the first year of the ACA exchanges--compared to the average individual plan one year prior. Furthermore, 2016 premiums are 20 percent lower than the Congressional Budget Office’s 2009 estimate.

The researchers attribute the lower rates to provisions of the law that prevent insurers from charging inflated premiums to sicker members, which drive up the average on individual plans. In an effort to offset costs, carriers have turned to narrow-network plans, which provided greater negotiating power with providers.

Ultimately, researchers estimate that even with a 10 percent increase in 2017, premiums would still be 30-50 percent lower than they would have been for silver-level equivalent plans if the ACA never took effect. 

- here’s the Health Affairs Blog post

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