N.Y. says cost of plans to dive
Health exchange’s prices set
Individuals buying health insurance on their own will see their premiums tumble next year in New York state as changes under the federal health-care law take effect, state officials are to announce today.
State insurance regulators say they have approved rates for 2014 that are at least 50 percent lower on average than those currently available in New York. Beginning in October, individuals in New York City who now pay $1,000 a month or more for coverage will be able to buy health insurance for as little as $308 monthly. With federal subsidies, the cost could be even lower.
Supporters of the new health-care law, the Patient Protection and Affordable Care Act, credited the drop in rates to the online purchasing exchanges the law created, which they say are spurring competition among insurers that are anticipating an influx of new customers. The law requires that an exchange be started in every state.
“Health insurance has suddenly become affordable in New York,” said Elisabeth Benjamin, vice president for health initiatives with the Community Service Society of New York. “It’s not bargain-basement prices, but we’re going from Bergdorf’s to Filene’s here.”
“The extraordinary decline in New York’s insurance rates for individual consumers demonstrates the profound promise of the Affordable Care Act,” she added.
Administration officials, long confronted by Republicans and other critics of President Barack Obama’s signature law, were quick to add New York to the list of states that appear to be successfully carrying out the law and setting up exchanges.
“We’re seeing in New York what we’ve seen in other states like California and Oregon — that competition and transparency in the marketplaces are leading to affordable and new choices for families,” said Joanne Peters, a spokesman for the Department of Health and Human Services.
The new premium rates do not affect a majority of New Yorkers, who receive insurance through their employers, only those who must purchase it on their own. Because the cost of individual coverage has soared, only 17,000 New Yorkers currently buy insurance on their own. About 2.6 million are uninsured in New York state.
State officials estimate that as many as 615,000 individuals will buy health insurance on their own in the first few years the health law is in effect. In addition to lower premiums, about three-quarters of those people will be eligible for the subsidies available to lower-income individuals.
“New York’s health-benefits exchange will offer the type of real competition that helps drive down health-insurance costs for consumers and businesses,” Gov. Andrew Cuomo said.
The plans to be offered on the exchanges all meet certain basic requirements, as laid out in the law, but are in four categories from most generous to least: platinum, gold, silver and bronze.
An individual with annual income of $17,000 will pay about $55 a month for a silver plan, state regulators said. A person with a $20,000 income will pay about $85 a month for a silver plan, while someone earning $25,000 will pay about $145 a month for a silver plan.
The least expensive plans, some offered by newcomers to the market, may not offer wide access to hospitals and doctors, experts said.
While the rates will fall overall, apples-to-apples comparisons are impossible from this year to next because all of the plans are essentially new insurance products.