Health Reform WK-EDGE 2020 brings increased choice, competition in health insurance marketplace
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Friday, November 1, 2019

2020 brings increased choice, competition in health insurance marketplace

By Rebecca Mayo, J.D.

CMS touts lower premiums on the health insurance marketplace for plan year 2020.

As improvements continue to be made to the HealthCare.gov health insurance marketplace, CMS is optimistic as numbers show an increase in Quality Health Plan (QHP) issuers, Quality Health Plans, and decreased premiums for plan year 2020. According to a CMS press release, shortly after the Patient Protection and Affordable Care Act (ACA) was implemented, premiums began to rise. As premiums rose, enrollees who were not eligible for subsidies began to decline and QHP issuers pulled out of the market. Over the past two years, CMS has worked to stabilize the market to increase competition, expand choice, lower costs, and give states more control. In a newly released letter, CMS announced the second consecutive year of improving market conditions (CCIIO Letter, October 22, 2019).

Choice and competition. From 2016 through 2018 the number of QHP issuers dropped from 237 to 132, which is a 44 percent drop in only two years. In PY 2020 there are 175 QHP issuers, which is a 20 percent increase from PY 2019. In 28 states, new issuers are entering and existing issuers are expanding service areas in PY 2020. In PY 2020 enrollees will have an average of three to four QHP issuers and nearly 38 QHPs to choose from compared to having two to three issuers in PY 2019. Only two states have a single QHP issuer in PY 2020, which is down from five states in PY 2019. Health Savings Account (HSA)-eligible QHPs are available to 97 percent of enrollees for PY 2020.

Cost. The state second lowest cost silver plan (SLCSP) benchmark plan premium decreased by 4 percent from PY 2019 to PY 2020 for a 27 year-old. The amount of the premium varies depending on advance payments of the premium tax credits (APTC) eligibility. A 27 year-old enrollee with a household income at 150 percent of the Federal Poverty Level has an average silver lowest cost plan premium of $52, while a 27 year-old who is not eligible for the APTC subsidy would pay $374.

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