An optimistic Obama administration touted a major phase of the Affordable Care Act — online health-insurance marketplaces — as having more options and lower premiums for consumers than originally projected.
Florida, where an estimated 3.8 million people live without health insurance, ranks near the top of the nation in terms of choices: Residents will have an average of 102 health plans to choose from when the federally run online marketplaces, or “exchanges,” go live on Oct. 1. That is second only to Arizona, where people shopping for insurance will have an average of 106 plans to consider.
A report released Tuesday by the U.S. Department of Health and Human Services also indicated that, nationwide, insurance premiums should come in about 16 percent lower than the government expected, with the average individual on a middle-tier plan paying $328 a month before tax credits. In Florida, a 27-year-old making $25,000 a year would, on average, pay a $218 monthly premium on the same health plan.
“Florida rates have actually come in quite well,” said Gary Cohen, director of the Center for Consumer Information and Insurance Oversight at the Centers for Medicare and Medicaid Services, in a conference call with reporters and Obama’s top health official, HHS Secretary Kathleen Sebelius.
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Average monthly premiums in Miami-Dade County would range from as low as $72 a month after tax credits for a family of four earning $50,000 a year that opts for a low-cost plan to $799 for the same family on a middle-tier plan without tax credits. In Broward County, a family of four would pay $24 a month with tax credits for the low-cost plan and $722 a month for the middle-tier coverage without tax credits.
But Wednesday’s report fails to provide an under-the-hood look at what the insurance plans will offer — provider networks or deductibles or co-payments or any other coverage details.
For that, consumers will have to wait until Tuesday’s opening of the online exchanges. Cohen said they will have plenty of time to sort out the details because the enrollment period runs from Oct. 1 through March 31, 2014. Consumers must buy insurance by Dec. 15 if they want to be covered starting Jan. 1.
“Consumers and advocates will have a full six months to look at the options available to them and make a choice based on what they think is best for themselves and their family,” Cohen said. For people who want to be insured by the start of the new year, “they have all of October, all of November and half of December to go online, look at plans . . . think about it, come back and make a decision.”
The online exchanges will allow individuals and small-business owners to shop for insurance and find out whether they are eligible for federal subsidies — tax credits — to help cover the cost of coverage or whether they can apply for Medicaid, the insurance program for the poor. The subsidies will be paid by the federal government directly to the insurance companies.
Enacted in 2010, the Patient Protection and Affordable Care Act — Obamacare — has triggered several reforms that affect Americans’ healthcare coverage. Among them, insurance companies can no longer deny coverage based on pre-existing medical conditions; dependent coverage for adult children has been extended to age 26; and insurance plans must offer at least 10 “essential benefits” that include hospitalization, emergency and outpatient treatment, maternity and newborn care, prescription drugs, pediatric services and more.
The law’s individual-insurance mandate is aimed at providing care for the estimated 48 million Americans younger than 65 who do not have insurance. Most Americans, about 85 percent, have health insurance through their jobs and are unlikely to buy coverage through the exchanges; Americans older than 65 who are covered by Medicare do not need to enroll.
The government projects that about seven million people will buy health coverage through the insurance marketplaces in the next year, and about six million of them will receive tax credits to lower their costs.
The subsidies will be for low- and middle-income residents who earn between 100 percent and 400 percent of the federal poverty level. For 2013, that includes individuals who make from $11,490 to $46,000, two-person families earning between $19,530 and $78,120, and four-person families earning between $23,550 and $94,200 a year.
Some, however, will be left without any health insurance. Florida is one of more than 20 states that did not expand Medicaid. The Legislature’s decision not to accept more than $50 billion in federal funds over 10 years to bolster Medicaid has left an estimated 995,000 people — mostly Florida’s poorest residents — without options for medical coverage. Those in the “coverage gap” have poverty-level incomes but do not qualify for Medicaid and are not eligible for tax credits to help buy insurance on the exchanges.
And Americans who are eligible but opt not to buy health insurance for 2014 will be penalized 1 percent of their annual income or $95 per person per year, whichever is more. The penalties will increase each year.
The average prices released by the government on Wednesday are based on various coverage tiers — including gold, silver and bronze — that consumers will have to choose from on the exchanges. Higher-priced platinum plans also will be available, as will low-cost “catastrophic” coverage for young adults.
In Florida, the average monthly premium for the least-expensive bronze plan is $257. That’s an uptick from the $243 statewide average insurance premium from 2012, according to Florida’s Office of Insurance Regulation.
The least-expensive plan in the silver tier would cost the average Floridian $304 a month, and the second-least-expensive silver plan would cost $328 a month, without tax credits.
The data released Tuesday offered examples of average premiums for 27-year-olds — the age at which adult children can no longer remain on their parents’ insurance plans — as well as for a family of four with an income of $50,000.
In the Miami-Hialeah metro area — the report offered a sampling of regional data — a 27-year-old earning $25,000 a year would pay $87 a month for the least-expensive bronze plan after tax credits. A family of four in the same area making $50,000 a year would pay $72 a month for the same plan after the subsidies.
In the Fort Lauderdale-Hollywood-Pompano Beach metro area, the 27-year-old would pay $74 a month and the family of four would pay $24 a month for the lowest-cost bronze plan.
Residents of Miami-Dade and Broward counties will have among the most plans to choose from of anywhere in the state — 137 and 132, respectively. Monroe County residents will have 18 coverage plans available.
“The fact that there are numerous plans available will enable competition between the plans to work on behalf of consumers,” said Ron Pollack, executive director of Families USA, a nonpartisan group that supports Obamacare. “As different plans compete with one another, they are going to have to provide a value to consumers, over and above what their competitors are providing. . . .
“One of the changes in the ACA is that it requires each of the plans to provide information in an understandable and rather uniform fashion, so consumers can compare apples to apples, something they have been unable to do in the past.”
Some insurance providers said they were eager for next week’s rollout of the online exchanges.
“We’ve long believed and hoped that we could provide affordable, competitively priced plans in a place like Florida,” Humana spokesman Mitch Lubitz said.
Others in the industry were skeptical.
“My understanding of the lowest bronze plan is that is has a $6,257 deductible. What does that mean to a 27-year-old?” said W. Adam Clatsoff, president of Coral Springs-based Adcahb Medical Coverages and a member of the Florida Health Insurance Advisory Board, which makes recommendations to the state’s insurance office. “This is a very expensive health insurance program. We have not lowered the cost of healthcare.”
“They are not telling the whole story,” said State Sen. David Simmons, R-Altamonte Springs, a member of the Senate committee on the Affordable Care Act. “The numbers I am seeing from employers — numbers that are being quoted by health insurance brokers — show significant and material increases in premiums.”
Still, state Sen. Eleanor Sobel, D-Hollywood, who testified on Obamacare before Congress last week, said she was pleased by the fact that Floridians will have so many options when they start buying health insurance on the exchange.
“The principles of competition and transparency are actually working,” Sobel said. “I’m elated for the people of Florida that they will be able to access affordable and quality healthcare.”
This story was produced in partnership with Kaiser Health News, an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente.