By Mariuxi Mansfield
(TEANECK) – Obamacare rates are going up.
The latest estimate from the federal government is that the average midlevel Obamacare plan, which is the most popular choice, will cost about 22 percent more in 2017 than in 2016, based on data from 39 states where people sign up through the website HealthCare.gov.
However, there is big variation nationwide. For example, customers in Phoenix, AZ are looking at a premium increase of 145 percent, while customers in Providence, RI, are looking at a 14 percent decrease, according to a Kaiser Family Foundation analysis.
However, many people are unaffected by the rate increases because they get their insurance through an employer or are covered through government programs like Medicare or Medicaid. Only a small fraction of Americans have insurance buy individual policies.
There are about 10 million people in the Obamacare market and around an additional seven million who buy health plans outside the market, according to the estimates of the Obama administration.
The published rate increases for the 2017 period apply only to people who shop in the markets, but premiums are expected to go up sharply for the other plans as well.
Obamacare plans usually cover a narrow group of doctors and hospitals, so people who change their plans may also have to find new health care providers. For healthy people, that may not matter and they may just want to find the cheapest policy. But patients with complex health needs may have a hard time abandoning a hospital or doctor and starting over with new ones.
But while it may feel as if medical care costs are going up dramatically, premiums for employer-based insurance have been increasing at historically low rates. Premiums for the average single person in the employer market are the same this year as they were in 2015, according to a large survey of employers from the Kaiser Family Foundation.
On average, premiums for “benchmark” plans offered on the state and federal government health insurance marketplaces are 10 percent lower than for the average employer-sponsored plan, the team at the Urban Institute found.
The employer-based premiums vary widely from state to state and even county by county because of the way health insurance is regulated in the U.S.
But overall, the premiums are lower than those paid by workers for their company-sponsored health insurance, according to the team at the Urban Institute.
Most Americans who get their health insurance through their employers have seen their annual premiums raise up at a historically low pace since Obamacare was passed six years ago.
Good news, right? So, why doesn’t it feel that way?
Behind the apparent stability in premiums, for many of the 150 million workers there is a catch: they are being shifted to high-deductible health plans, which companies are increasingly supporting as a way to hold down their own health care costs.
And while employees may see less coming out from their paychecks, they are stuck with more out-of-pocket costs before their insurance coverage kicks in.
Still, the Kaiser Family Foundation’s survey of 1,900 American employers found the shift to high-deductible plans is helping hold down the average increase this year in premium costs for all families covered by employer plans.
To help to carry the weight of higher out-of-pocket medical costs, high-deductible plans can be combined with Health Savings Accounts — similar to but more beneficial than Flexible Spending Accounts — that allow workers to pay for certain medical expenses with tax-free dollars.
In a 2015 study by the National Bureau of Economic Research, it followed one company that shifted all of its employees to a high-deductible health plan and even contributed to each worker’s health savings account so they didn’t have to spend any of their own money on medical costs.
Even so, researchers found that to keep their costs down, many employees were skipping important medical appointments completely, from colonoscopies to mammograms, both of which are free preventive care services under Obamacare.