Most consumers face premium hike
A new study of health care premiums shows a mixed bag for consumers as most Michiganians and Metro Detroiters will experience price increases despite reductions in a majority of the state's 83 counties.
Price increases in a benchmark health plan offered under the Affordable Care Act ranged from 2.5 percent in Wayne County to 4.5 percent in Macomb and Oakland counties, according to the University of Michigan's Center for Healthcare Research and Transformation. Calhoun and Kalamazoo counties experienced 7.1 percent hikes, the highest in the state.
But most counties around Michigan experienced monthly premium declines, topped by 10.6 percent decreases in the west-side counties of Kent and Oceana, the UM center reported. Most Michiganians face premium hikes because the 27 counties that experienced increases in the benchmark plan — the second-lowest-cost silver plan — account for nearly 70 percent of Michigan's population, according to 2013 U.S. Census Bureau estimates.
A silver plan covers 70 percent of medical costs, leaving the other 30 percent for patients to pay.
But the rate of increase in monthly premiums appears to be lower than in the 2008-10 period, when premiums grew 10 percent or more annually before many provisions of the Affordable Care Act went into effect, the UM group said. Under federal law, uninsured individuals are required to buy health insurance or pay a penalty unless they qualify for an exemption.
Michigan's health insurance marketplace has changed dramatically since the first open enrollment period under the Affordable Care Act, also known as Obamacare, with more plans offered nearly everywhere in the state, according to the Center for Healthcare Research and Transformation. The number of health plans more than doubled in the four-county Detroit area compared with the first enrollment period in late 2013.
"More competition is good — it will drive prices down," said Richard Murdock, executive director of the Michigan Association of Health Plans. "And the new transparency (of insurance companies' rates) is a valuable customer tool.
"It's price competition, so you know exactly how much a company is charging for similar products. These are results that folks wanted to see through the whole health insurance exchange process. One of the premises of the (Affordable Care Act) was to create more competitive options."
Consumers eligible for a marketplace plan must enroll at HealthCare.gov no later than Dec. 15 for coverage to start Jan. 1. Federal subsidies are available only to those who enroll at HealthCare.gov.
The study found wide variation in prices across the state, meaning the amount consumers pay will depend largely on where they live.
"Just going 40 or 50 miles, people's experiences of how rates have changed from one year to the next can be very different," said Josh Fangmeier, health policy analyst for the UM center.
The center used each county's 2015 benchmark plan to determine whether premiums went up or down since the first open enrollment period ended March 31. The benchmark is a key part of the formula used to calculate federal tax credits that can reduce the cost to consumers.
Wayne County had the largest net increase in the number of insurance plans from which to choose, increasing from 52 plans to 126. Insurance options increased nearly everywhere, with a greater number of plans offered in 73 of Michigan's 83 counties.
Health care advocates are urging consumers to review their options at HealthCare.gov even if they're happy with their coverage. Under federal law, consumers who take no action will automatically be re-enrolled in their current plan or the most similar plan offered by their insurance company, said Shawn Dhanak, Michigan spokesman for Enroll America, a nonprofit health care advocacy group.
"We're encouraging everyone to go back to the market because their income might have changed, and we want them to get all of the tax credit that is available to them," Dhanak said. "We know the average consumer last time around received a premium reduction of about 70 percent."
He also encouraged consumers to get trained help when choosing a health plan. Application counselors take an online course to be certified. Navigators are federally funded and receive more extensive training. Advisers are listed at enrollmichigan.com by region.