I’ve been looking into this one.
Highmark selling in Lancaster County, Pennsylvania, had some extraordinarily low premium offerings for its policies that started in 2014. As Highmark was the “second lowest cost Silver Plan” in the county, ALL the Premium Tax Credits in the county were based on the Highmark price.
This meant that insurers like Keystone or Capital Blue, who were considerably more expensive than Highmark, were being priced out of competition in the ACA market. Just to give you a sense of what this market has become in Lancaster County, there are about 17,000 people with ACA policies, and this makes up about 3% of the market. It’s suggested that there are another 3% in Lancaster area who are eligible for ACA and the Premium Tax Credit, but either don’t know or haven’t bothered to go get a policy.
(There’s still a fair amount of bad-mouthing of “Obamacare” around here, even though the people who do get an ACA policy mostly like it. Ah, well. People.)
For 2016, Highmark submitted their proposed rates to the Pennsylvania Insurance Department. It turns out that, since Highmark was priced low in 2014, and 2015 as well, they want to end the low-ball plans, and propose big markups for the replacement plans. (For example, an old HSA offering, Health Savings Blue PPO 1700, which was about $300 for a middle-aged person, gets replaced by a Health Savings Blue PPO 2700, going for about $500 a month. The 1700 and 2700 were the deductibles, so you see that moved up considerably.)
These adjustments now put Highmark in the price range of other plans offered on the ACA Marketplace for Lancaster County.
So does this price a lot of the current customer base out of the Marketplace in Lancaster?
Somewhere between 80% and 90% of Lancaster County taxpayers have been eligible for the Premium Tax Credit. So what the price hike by Highmark simply means is more of our federal tax dollars are coming back to the Lancaster area. Yes, it looks like the deductible could be an issue, but since it can be joined with a Health Savings Account, the federal tax deduction covers a part of that, too. And if you are in the “Enhanced Silver” range (under about $29,000 income for a single person), the deductible is partly covered by the Treasury.
I expect to see this price hike twisted seven ways to Sunday by the county’s “Tea Party” nuts who are trying their hardest to turn America into a third-world, lords-and-serfs society. But it sounds like next month, when all the prices are available in the Marketplace, it will just be a matter of modest adjustments, which have been going on with health care in America for the last 50 or 60 years.