Senate Passes Bill Aimed at Lowering Individual Health Insurance CostsKTOO.com (AK) (06/03/16) Kitchenman, Andrew
Alaska’s Senate voted 15-2 on June 3 to pass a bill to curb health insurance premium increases for individuals and families in the state. Alaska Insurance Division Director Lori Wing-Heier earlier told lawmakers that the individual insurance market could collapse if the legislature did not pass House Bill 374, which provides $55 million to fund a reinsurance program to offset the cost of Alaskans with the highest healthcare costs. Wing-Heier cites several reasons for Alaska’s high healthcare costs. “There’s a lot of duplication in equipment in Alaska. And there’s also no mechanism to control fees in the private industry and physicians,” she says. “Those are things that we need to work on.” Related Story: Associated Press
Well, at least this time it’s not being blamed on greedy insurance companies and CEO pay😷.
Of course, the main driver is probably not fees either, but more likely the utilization of health care … you know Alaskans with the highest healthcare costs … just like it is for the rest of America.
PS As usual this political action solves nothing, but don’t you wonder where Obamacare is in all this?
Well, the truth is that for the smart people who enroll through the Obamacare exchange, the premium subsidies are taking nearly all the hit for high premiums. The average net premium is only $126. Alaskans thank the taxpayers of America for making health care “affordable.” I hope. Solving health care costs one subsidy at a time🤑
Source: health insurance.org
For now, premium subsidies bear the brunt of the rate hikes in Alaska – but only for people who earn up to 400 percent of the poverty level. People with incomes a little over that amount are facing health insurance costs that are truly unaffordable.
But for people who do qualify for subsidies, the subsidies ensure that the cost of the benchmark plan remains at a level deemed affordable under the ACA. Of the people who enrolled in coverage for 2016, 86 percent are receiving premium subsidies. The average subsidy in Alaska in 2016 is $737/month – more than two and a half times as high as the $290/month average across all the states that use Healthcare.gov.
Premium subsidies are particularly important in Alaska; they’re higher there than anywhere else in the US, thanks to the fact that unsubsidized premiums are so much higher than they are in the rest of the country.
For people who enrolled in a health plan through the Alaska exchange during the 2016 open enrollment period, the average pre-subsidy premium was $863/month. This is more than double the $396/month average across all states that use Healthcare.gov. But for the 86 percent of enrollees who are receiving a premium subsidy, the average after-subsidy premium is just $126/month.
This is slightly higher than the $119/month average in 2015, but the average pre-subsidy premium was $652/month in Alaska in 2015. So while the average pre-subsidy premium increased by more than $200/month, subsidies mitigated almost the entire increase (for additional perspective, the average after-subsidy premium in 2014 was $94/month in Alaska).
Obviously this doesn’t help the 14 percent of enrollees who aren’t receiving premium subsidies, or the people who enrolled in plans outside the exchange, without access to premium subsidies (anyone eligible for subsidies should make sure to purchase a plan through the exchange, as subsidies aren’t available off-exchange).