As North Carolina is reeling from some of the highest health insurance rates in the nation under the Affordable Care Act, U.S. health secretary Sylvia Mathews Burwell on Monday advised residents to shop around for better deals.
Burwell stressed a lesson repeated often by ACA advocates: Rates can appear excessively high for the same plan year-over-year, but customers are likely to find better deals if they explore other plans.
“People who shopped actually saved money,” Burwell said of people who are enrolled in the ACA this year.
Open enrollment for individual insurance policies under the ACA began Sunday for people who want to continue or start health coverage Jan. 1. These individual policies are sold on federal or state exchanges and come with financial subsidies for people in middle-to-lower income brackets.
In North Carolina, three insurers are offering policies on the federal exchange, and raising rates between 2.5 percent and 50 percent next year. The state’s biggest insurer, Blue Cross and Blue Shield, is raising rates by an average of 32.5 percent.
Burwell spoke to North Carolina journalists on a conference call Monday, largely extolling the federal health program that she said has removed 17.6 million Americans from the ranks of the uninsured. She said more than 90 percent of the 460,000 enrolled in the state received federal subsidies, so they will not pay the full rate increase.
She said that the average rate increase from 2015 to 2016 in ACA plans is 7.6 percent. Nationwide, she said, 70 percent of people on the marketplace are finding plans that cost $75 a month or less, with federal subsidies.
“It’s important to remember that when we talk about rates the conversation actually includes financial assistance,” she said.
Still, North Carolina has higher ACA premiums than any state except Alaska, Wyoming and Delaware, according to a data analysis by HealthDecisions.us, a Chapel Hill brokerage that helps the public compare insurance costs that include premiums, deductible and co-payments.
HealthDecisions.us compared prices of the second lowest-cost “Silver” plan across the country, and found that North Carolina’s plan was priced 78 percent above the cheapest state, Indiana, as priced for a family of four, with two 40-year-old parents and two children.
The North Carolina plan cited by HealthDecisions.us was an UnitedHelathcare policy in Bladen County and surrounding area with a monthly premium of $1,004 and a $4,000 family deductible. Such a plan would cost the family about $16,000 in premiums and deductibles before the insurance kicked in next year.
Blue Cross blames sicker, costlier customers for its substantial rate increase, which was approved by the N.C. Department of Insurance.
“Our rates must reflect the real costs associated with the amount and types of health care services our customers are actually using so we can continue paying for their health care,” the company said in an online update two weeks ago.
Blue Cross said customers are submitting claims for prescriptions, ER visits and costly procedures. Some are canceling coverage after they receive their benefits.
“Most of those who dropped their coverage first used expensive medical services,” the company said. “The others who canceled their plans were among the healthiest customers, those who had not filed any claims.”