Minnesota Announces 2015 Exchange Rates, Touts Lowest Obamacare Premiums in Nation

Minnesota Announces 2015 Rates, Touts Lowest Obamacare Premiums in Nation

Obamacare open enrollment for 2015 begins Nov. 15, 2014, and the question on many Americans’ minds is “Will my insurance premiums go up?” While most won’t know for certain until they can shop the state-based and federally facilitated exchanges next month, some states have begun to reveal finalized rate and plan information.Minnesota released its 2015 Rate Summary on Oct. 1. The Minnesota Department of Commerce claims that individual and family health insurance plan rates through Minnesota’s state-based exchange, MNsure, remain the lowest in the nation. The average premium will increase 4.5 percent, even after last month’s announcement that PreferredOne, MNsure’s most popular and low-cost insurer, would no longer offer coverage through the exchange. New to the exchange, BluePlus will join MNsure’s four returning carriers

Furthermore, MNsure officials are touting increased advanced premium tax credits—advanced premium tax credits are those applied to reduce monthly premiums, as opposed to the “get it later” option in which consumers pay the full monthly premium each month and apply for credits when filing their federal income tax return the following year.

While relatively small rate increases and more subsidy funds may sound like a good thing, it is unclear how many people will truly benefit. Some plan rates could decrease significantly and others could increase substantially. The Minnesota Department of Commerce rate summary reported rate decreases as much as 9.7 and increases as high as 17.15 percent. It all depends on where you live, your health insurance plan—and whether or not you select a new one, and your age.

In a press release, MNsure publicized Minnesotans shopping the exchange would get “more financial help” in 2015 but failed to elaborate on details. For some, depending on premium rate fluctuations, the increase in premium tax credit could be a wash.

Premium tax credits are based on a benchmark plan—the second-lowest cost silver plan offered in an area—and the percentage of income individuals and families at different income levels are expected to contribute toward health insurance premiums.

Those who earn between 100 and 400 percent of the federal poverty level may be eligible—eligibility works on a sliding scale. So, for instance, if you make 133 to 150 percent of FPL, your premium as a percent of income is 3 to 4 percent. That percentage is taken from the benchmark plan to determine the dollar amount you pay and how much premium tax credit you could receive. If you remain in the same income range as 2014 and the rate for the second-lowest cost silver plan in your area increased for 2015, your subsidy will increase, too. And, as we said above, you could still end up paying the same amount depending on what rates do and the plan you choose.

Individual and family plan selection

Additional highlights from the Minnesota Department of Commerce’s 2015 Rate Summery and MNsure’s Snapshot of 2015 Premiums and Tax Credits include the following:

  • 5 health insurance companies will sell individual and family health insurance plans.
  1. Blue Cross and Blue Shield of Minnesota
  2. BluePlus
  3. Group Health, Inc. (Health Partners)
  4. Medica
  5. UCare
  • 84 individual and family health insurance plans will be offered in 2015—there were 78 options in 2014
  • There will be 26 to 72 plans in each county and at least two from every metal plan represented
  • The state’s lowest monthly premium rates for a bronze plan (in the Twin Cities metro) will be $109.93 for a 25-year-old, $139.93 for a 40-year-old and $297.16 for a 60-year-ld. For the same ages, the lowest premium rates for a platinum plan will be $206.23, $262.51, and $557.47.

Many regions in the state have upward of 20 more plan options than they did in 2014. This can also impact rates. For instance, MNsure reports that northeastern part Minnesota will have 20 more health insurance products to choose from than in 2014 and at a reported rate decrease of as much as 19.33 percent.

$0 deductible plan

MNsure is also promoting that, for the first time, it will offer a health insurance plan without a deductible: Blue Cross Blue Shield’s BlueAccess No Deductible Plan 442. This platinum plan has a $2,500 per person and $5,00 per family in-network out-of-pocket maximum for medical services and prescription drugs.[1]

Pre-subsidy rate samples in the state’s Area 8 pricing region, which includes the Twin Cities, and Area 7 pricing region, which includes central and north-central portions of the state, are as follows[2]:

Area 8

30-year-old               $280.29

40-year-old               $315.61

50-year-old               $441.06

60-year-old               $670.24

Area 7

30-year-old              $310.69

40-year-old               $349.83

50-year-old               $488.89

60-year-old               $742.91

Unlike last year, platinum plans will be available statewide through the exchange in 2015. These plans are not limited to the no-deductible platinum plan, which is available in all regions.

A low- or zero-deductible health insurance plan can be a savings for those with chronic health conditions that require frequent medical care. Yet, the option will not suit all consumers wishing to avoid a deductible. Low deductibles typically come with high monthly premium rates.

Consumers will have to do the math and see if financial assistance in the form of premium tax credits makes such plans worthwhile. They will also need to check plan networks to see if they offer access to their preferred and conveniently located providers and hospitals.

Small businesses

Minnesota’s small business owners can offer their employees health insurance through MNsure’s Small Business Health Options Program (SHOP). Employers with two to 50 employees may use the exchange, and those with 25 or fewer employees who earn, on average, $50,000 or less may qualify for premium tax credits.

In 2015, three insurers will offer a total of 66 small group health insurance plans: BluePlus, Medica, and Blue Cross and Blue Shield. According to the Department of Commerce 2015 Rate Summary, small group rates will increase 3 to 4 percent in 2015.

Perhaps the wisest thing anyone can do is shop for and compare plans both on and away from their state’s exchange. Looking at monthly premiums, annual deductibles and out-of-pocket limits, coinsurance, copayments and network providers can help individuals and families find coverage that works for best for their healthcare needs and financial situation.

Use HealthCare.com’s Obamacare tax credit subsidy calculator {http://info.healthcare.com/subsidy-calculator} to see if you might be eligible for a subsidy—and estimate how much—if you purchase coverage from your state’s exchange. While you’re visiting HealthCare.com, enter your ZIP code to find and compare plans in your area. Call (877) 626-1943 to get help directly from an agent.

 

 

References

The Henry J. Kaiser Family Foundation. “Explaining Health Care Reform: Questions About Health Insurance Subsidies. July 1, 2012. http://kff.org/health-costs/issue-brief/explaining-health-care-reform-questions-about-health/

Minnesota Department of Commerce. “2015 Rate Release Packet.” http://mn.gov/commerce/insurance/images/2015RateReleasePacket.pdf

MNsure. “Health Care Coverage and Plan Rates for 2015: A Snapshot of 2015 Premiums and Tax Credits.” https://www.mnsure.org/images/2015-10-1-MNsure-healthcare-coverage-plan-rates.pdf.

 

[1] Minnesota Department of Commerce. “BlueAccess Platinum No Deductible Plan 442.” http://mn.gov/commerce/insurance/images/BlueAccessPlatinum442.pdf.

[2] Minnesota Department of Commerce. “Rates Table – BCBSMN – Individual.” Oct. 1, 2014. http://mn.gov/commerce/insurance/images/BCBSIndividual-Rates.pdf

Colleen McGuire

About Colleen McGuire

Colleen McGuire is an independent consultant who has spent most of her career writing about healthcare and the health insurance industry. For fun she blogs, travels and takes a lot of pictures along the way.

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