SummaryOne of the most anticipated questions about exchanges has been what the impact of rate shock will be on the market.
Avalere Health analyzed public rate filings released by 12 states*-8 state-run and 4 federally-run or partnership exchanges. Based on the analysis, minimum premiums for a 40-year old, nonsmoker averaged across states is $261 per month for a Silver exchange plan. Premiums for the lowest cost Silver products available in each state range from $197 per month in Maryland to $383 in Vermont-a difference of $186 across states. “Regardless of whether the state or federal government is operating the exchange, we are seeing competitive Silver premiums in the low $200 to $300 range in most markets,” says Caroline Pearson, Vice President. Avalere analysis of the exchanges is offered through the Avalere PlanScape™ offering.
Silver premiums vary widely within some states, particularly in markets with many participating carriers and geographic rating regions. For example, the difference between the minimum and the maximum Silver premium in New York is $418 across 16 carriers and 8 regions within the state. By contrast, in Rhode Island where the entire state makes up a single region and only two carriers are participating, the difference between the minimum and maximum silver premium is only $28 per month. “We expect consumers to disproportionately enroll in lower cost plans within a state,” says Pearson, “particularly when prices within a region vary dramatically. People may be willing to pay a few dollars more a month to buy a plan from a carrier they trust, but large pricing jumps may limit enrollment for higher cost products in a given metal level.”
*Avalere analysis of released rates for California, Connecticut, Washington D.C., Indiana, Maryland, New York, Ohio, Rhode Island, South Dakota, Vermont, Virginia, and Washington.