Health insurance is an ever-changing industry. In the video below, Jeff Hess, individual, group, and ancillary health expert, shares the biggest changes that will affect the 2017 plan year. Watch now to better prepare for the upcoming ACA season!
Change #1: Fewer Choices
Okay, as for the changes for 2017, there’s a lot actually. Some of the changes you’ll notice are that there are not a lot of choices out there anymore. For those people wanting on-exchange or marketplace-type plans, where you actually get advance premium tax-credits (APTC) to lower your monthly premium, there was anywhere from three to seven different carriers offering plans last year in a lot of states – and last year, meaning 2016. For 2017, because they lost hundreds of millions of dollars throughout the last few years on the Affordable Care Act, carriers are getting out of the marketplace.
So if you look at Texas as an example, you’re for the most part just going to have Blue Cross and Blue Shield of Texas. Now where we’re at in Tarrant County, which is the Dallas-Fort Worth area, we’ll actually have two on-exchange plans available. In Dallas County, there’ll be three. So, it went from seven or eight down to three. There are some states, such as Alabama right now, where it looks like there’s only going to be one option. We’ve got Arizona that’s another state and Tennessee, which could both be down to one. The options are just not going to be there.
No Competition Means Limited Options
Basically, the Affordable Care Act, rather than promoting healthy competition between carriers trying to get market share, has prompted several carriers to say, “No, you can have it.” It’s a last man standing sort of scenario. With the election coming up, of course everything is going to change again probably starting in the mid-part of 2017. Either way – whoever wins – it’s going to change because all sides are saying [ACA] is broken and needs to be fixed. I’m here to tell you what to look for during 2017 Open Enrollment. You’re going to have a lot less choices. Plain and simple. You’re not going to be choosing between seven or eight carriers. Sometimes you’re only going to have one choice. That’s what the marketplace looks like for 2017 as of today.
Change #2: The Maximum-Out-Of-Pocket Is Increasing
Another change coming is that while the maximum-out-of-pocket for 2016 is $6,850 for individual or $13,700 for a family, in 2017 those costs are raised to $7,150 for individual or $14,300 for a family. That’s a lot of money. We’ll talk at another time how to bridge the gaps with ancillary products that will help protect you against these large out-of-pocket exposures because that is going to be an issue. If you have affordable health insurance, you’ve got the money and the affordability to pay for the premiums to have it, but you can’t afford to use it because of your out-of-pock exposure. So, we’ll discuss at a later time the ways to combat that issue for a little bit of money but at least whole lot less than $7,150.
Now in 2017, if you don’t have a qualified health plan, the good news is the penalty doesn’t change [but you still have to consider a rise due to inflation] from 2016 to 2017. It’ll be the same. That’s $695 a person per adult and half of that per child. In other words, 2.5% of your adjusted gross household income.
Change #3: Premiums Are Rising
As far as changes are concerned, one of the biggest changes that you’re going to notice is the premium. In 2017, premiums are going to jump by quite a bit. To give an example, in the state of Texas, Blue Cross Blue Shield had requested a 51% to almost 59% rate increase throughout the entire state. I believe they have been approved so most everybody should be seeing about a 50% rate increase on their premium.
The people that are going to be noticing the largest change in premium will be those who are paying the full premium. However, it’s going to affect everybody regardless of whether you’re on-exchange or off-exchange. If you’re on the marketplace and getting APTC, you’re still going to get a rate increase. Unless you’re getting 100%, you’re not going to notice it. Because the closer you are to the Federal Poverty Level (FPL), the less amount of change you’ll notice as far as actual dollar amount. Still, you’re going to notice a percent increase over and above what you’ve been paying last year for the same plan. This is throughout the entire United States.
You see articles out there in pretty much every publication, saying which states approved specific carriers for rate increases. Whenever you start getting your letters about how your plan premium is going up, don’t panic. Get with an agent. Find out which carriers are still available what the best options are for you.
Since insurance is oftentimes overwhelmingly confusing, we want to shed light on this industry by answering YOUR questions. So if you have any questions or concerns, comment below and your question may be the topic of our next video!