Politics Become Part Of Indiana Health Insurance Exchange
Politics has been injected into how the health plans will be offered on Indiana's health insurance exchange when it opens for business on Oct. 1.
The Indiana Department of Insurance announced last week that individual rates would increase a staggering 72 percent via the plans offered through the exchanges, from $250 a month to $570 a month starting in 2014.
“This new data regrettably confirms the negative impact of the Affordable Care Act on the insurance market in Indiana,” said Logan Harrison, deputy chief of the Indiana Department of Insurance. “The Affordable Care Act requires many Hoosiers to purchase more comprehensive and more expensive health insurance than they may want or need. These rates call into question just how affordable health insurance will really be.”
However, the increase was dramatically opposed to the news in New York, where regulators last week forecast an average drop of 50% in individual premiums. It also contradicted relatively moderate premiums forecast by officials for the exchange in California.
Harrison is an appointee of Indiana Gov. Mike Pence, a Republican who has been a staunch opponent of the Affordable Care Act. As in most states opposed to the ACA, the federal government will operate the exchange in Indiana.
It was made clear this week that Harrison's actuarial data was cloudy. He admitted to the Iowa General Assembly's Health Finance Commission on Monday that only a fraction of the state's residents would experience a rate increase as high as 72%. Moreover, the calculation was determined by matching the lowest rate consumers currently pay against an average of all rates available in the exchange – including the costliest gold and platinum-level plans.
In Massachusetts, which has offered similar plans to its residents for the past decade, 90% enroll in the lower cost silver and bronze plans, with nearly half in bronze coverage, the cheapest available.
Similar actuarial math was confirmed by at least one carrier that will offer coverage through the Indiana exchange: Physicians Health Plan of Indiana estimates that 83% of enrollees who purchase its coverage through the exchange will pick lower cost plans, with nearly half overall enrolling in the least expensive coverage available.
And Harrison also admitted that the premiums do not even factor in the tax credits that will be offered to Indiana residents who purchase through the exchange. The credits, which are immediately redeemable to purchase coverage and are credited against the monthly premium, are available to residents with household incomes of more than $94,000 a year – about 90% of Indiana's residents.
“It turns out Indiana’s rates look a lot like the rest of the country,” the Washington Post reported late last week after analyzing the rate filings of the insurers.
