Most plans on the individual insurance market are likely to see steep price increases next year, continuing a trend of annual rate hikes.
Nearly every insurer that has filed intentions to offer a plan on the Affordable Care Act’s exchange for 2019 predicts large cost spikes, with one going up nearly 85 percent. Some insurers, though, are predicting decreases, such as Anthem HealthKeepers and Optima Health Plan.
The rates must be approved by the state’s Bureau of Insurance, and insurers will make presentations explaining the changes in June. But as they are filed now, the 2019 rates continue to make health insurance more expensive for those buying the plans, though most of them receive federal subsidies to help them cover the costs.
For someone in the Richmond area with a Cigna plan, the average monthly cost will rise from $502 this year to $611 in 2019.
There are a variety of factors feeding the rising costs, said Doug Gray, the executive director of the Virginia Association of Health Plans. The most immediate is that the administration under President Donald Trump cut cost-sharing reduction payments after Congress failed to repeal the Affordable Care Act, often called Obamacare. Insurers are required to offer cost reductions to low-income members by law, and raised their rates once the federal government stopped paying them.
Democratic leaders in the state — Gov. Ralph Northam, Rep. Donald McEachin, D-4th, and Sens. Mark Warner and Tim Kaine — released statements Thursday expressing dismay at the rising prices and blaming them on the Trump administration’s actions.
Northam said he is disappointed in what he called the Trump administration’s “active sabotage of the health care system,” and denounced the federal government’s push for short-term plans, which were originally designed for people who have a temporary gap in health care and often don’t cover pre-existing conditions. Proponents of the plans say they’re a way to avoid the costs on the individual market.
But despite the current climate at the federal level, issues have plagued the individual market since it began, Gray noted, largely because the population who took advantage of the ACA’s exchanges were sicker than anticipated.
“So that’s what’s driving it, but the administration has made it worse,” Gray said.
He added that the costs of health care in general are going up in the U.S. Even without the added issues on the individual market, the insurance rates also reflect the rising cost of hospital stays and prescriptions, among other things.
“The practical reality is that the underlying cost of health care is very high,” Gray said. “We pay more in this country than any other country, and we get less for it. And that’s not going to be sustainable over the long term.”
But he pointed out that there is one bright spot on the horizon. Whereas briefly last year some Virginia counties were stripped of any options on the exchange after some insurers left the market, this year one new insurer, Piedmont Community HealthCare, has expanded its coverage area to include Charlottesville, and Virginia Premier Health Plan is planning to serve the Richmond area, giving those in the Richmond area one more option in addition to Cigna.