The Greenville News
August 3, 2013
August 3, 2013
“I would strongly
encourage the public not to get too excited about these numbers, because
there’s actually good news coming in federal subsidies,” said Frank Knapp,
president and CEO
of the South Carolina Small Business Chamber who supports the changes to how
customers buy health insurance.
Health law to hit
some hard
By Eric Connor
Health insurance premiums for those in South Carolina who aren’t covered through their employers could rise dramatically next year once the federal government’s Affordable Care Act takes effect, according to a state insurance agency’s review that proponents of the new health care law insist doesn’t paint a complete picture.
The
state Department of Insurance on Friday released the results of its review of
health plans that insurance companies want to offer on the new federally
subsidized insurance exchanges that are required under what’s commonly referred
to as Obamacare.
The agency’s director, Ray Farmer, said that average rates for individuals buying insurance will likely increase between 50 to 70 percent, and in some cases could more than double depending on age, health and insurance needs.
The agency’s director, Ray Farmer, said that average rates for individuals buying insurance will likely increase between 50 to 70 percent, and in some cases could more than double depending on age, health and insurance needs.
Those
who participate in small group plans will likely see average rate increases
between 10 to 20 percent, Farmer said.
Premiums
for people who are insured through employer-sponsored plans won’t be affected
when new coverage plans go into effect on Jan. 1, he said.
“Due
to a number of new federal requirements going into effect next year as part of
the Affordable Care Act, consumers should plan for premiums to increase
significantly,” Farmer said.
The
estimates are based on comparing plans insurance companies offer now to those
they have submitted for exchange enrollment on Oct. 1.
However,
critics of the findings said Friday that the analysis doesn’t elaborate on
other factors of the health care law, such as federal subsidies that will help
most customers
afford the premiums.
“I
would strongly encourage the public not to get too excited about these numbers,
because there’s actually good news coming in federal subsidies,” said Frank
Knapp, president and CEO of the South Carolina Small Business
Chamber who supports the changes to how customers buy health insurance.
The insurance plans offered today aren’t
comparable and in fact many wouldn’t be allowed under provisions of the new law
that ban limits on pre-existing conditions and mandate coverage for everyone,
said Cheryl Fish-Parcham, deputy director of health policy for the advocacy
group Families
USA.
“Insurance
will be covering more than it has in the past,” she said. “In the past, many
people faced crazy exclusions of benefits like buying coverage but it not
covering maternity care for a woman. For the first time, people are going to be
getting real coverage that covers them.”
The
state’s largest insurer, BlueCross BlueShield, said the rates it submitted for
review were fair but that new requirements must be taken into account, such as
more benefit requirements, federal taxes and fees, changes in how companies
must calculate rates and guaranteed coverage.
“These
additions and changes add unavoidable, additional expense for our customers,”
said BlueCross spokeswoman Elizabeth Hammond.
Lawmakers
in South Carolina have fought implementation of the health care law from the
start, citing an overreach of government authority that requires people to buy
health insurance they might not want.
The
state opted not to create a state exchange, instead relying on the federal
government’s system, and rejected federal money expanding Medicaid.
“Today’s
news that insurance premiums in South Carolina may skyrocket as much as 70
percent for some South Carolinians is as awful as it is unsurprising,” said
Doug Mayer, spokesman for Gov. Nikki Haley.
About
900,000 uninsured South Carolina residents will have to sign up for insurance or face fines
under the law.
In
2014, a person who doesn’t pay for health insurance but is deemed financially
able to faces a fine of $95 or 1 percent of annual income, whichever is
greater. The fine is $47.50 per child but no more than $285 for a family.
In
2015, the fine increases to $325 per adult, $162.50 per child but no more than
$975 for a family, or 2 percent of annual income.
The
fine in 2016 and beyond will be $695 per adult, $347.50 per child but no more
than $2,085 for a family, or 2.5 percent of annual income.
The
fine wouldn’t provide health insurance if a person got sick.
The
federal government must now approve the exchange plans insurance companies
submitted to the state.
Of
South Carolina’s 12 health insurers, four will be selling policies on the
exchange with the remaining selling alternate policies off the exchange, Farmer
said.
The
policies off the exchange will be reviewed in the next 45 days, he said.
The
insurance department provided wide-ranging estimates for how the new
requirements could impact premiums.
For
instance, a person at age 20 could see rates increase anywhere from 5 to 151
percent, Farmer said. A person age 40 could see increases between 2 to 162
percent, a person age 60 between 13 to 134 percent.
The
department is “actively working with all carriers seeking approval of filings
for products to be sold in the state,” Farmer said.
“It’s a new process for everyone,” he said.
“I encourage our citizens to shop around.”
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