People browsing for health insurance at HealthCare.gov — the federal marketplace that covers 33 states — may be in for some good surprises, including lower premiums, more choices, and continued generous subsidies, according to a new report by the Centers for Medicare & Medicaid Services (CMS).
CMS, a division of the U.S. Department of Health and Human Services, is the arm of the federal government that runs Medicare — the public insurance program for older people and many people with disabilities — and administers Medicaid, the joint federal-state health insurance program for low-income people. It also runs the federal marketplace for private insurance that was created under the Affordable Care Act (“Obamacare”) and covers states that decided not to run their own marketplace. But regardless of where you live or what kind of insurance you qualify for, the federal marketplace — HealthCare.gov — can point you in the right direction, either letting you buy insurance directly or sending you to your state’s marketplace or Medicaid program.
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Under the Affordable Care Act, most people (63%) who buy private health insurance from the federal marketplace or their state’s marketplace qualify for federal subsidies. This means that if your income is below a certain level — depending on your family size and where you live — you’ll only have to pay part of your monthly health insurance premium, and the federal government will pay the rest. You can choose to take this subsidy either as a lower premium each month, or as a credit when you file your taxes each year. In March 2021, these subsidies were increased as part of the American Rescue Plan, the law passed by Congress that — among many other things — extended eligibility for them to everyone under 600% of the federal poverty line, and increased the amount of subsidies for people who already qualified for them. These changes, which apply to the calendar years 2021 and 2022, led to an average savings of $70 per month for current insurance plan members, and reduced the premium for anyone under 150% of the federal poverty line to $0 for “silver plans,” which also feature reduced out-of-pocket costs in areas like copayments and deductibles.
Premiums for benchmark plans decrease
Now, on top of the continued more generous subsidies for 2022, CMS reports that the average premium for benchmark silver plans at HealthCare.gov will decrease by 3% — following a similar 3% drop for 2021. This drop may be related to greater competition among health insurance providers, as the average enrollee will be able to choose from six to seven providers for 2022, compared with four to five providers for 2021. Only 2% of enrollees will have access to only one provider for 2022, compared with 4% for 2021. A total of 213 providers are offering plans at HealthCare.gov for 2022 — 32 more than for 2021. After applying federal subsidies, 67% of enrollees are expected to have monthly premiums of less than $10 per month in 2022.
Extending the increase in subsidies for federal and state marketplace insurance plans is the subject of ongoing negotiations among Democrats in Congress and President Joe Biden, as they work to draft a bill — widely known as Build Back Better — that would enact much of the president’s social policy agenda. While the president and many Democrats hoped to make the increased subsidies permanent, it now appears likely that they will be extended for only a few years due to concerns about the cost from other Democrats, according to a CNN article.
Want to learn more about saving on your diabetes care? Read “Save Money on Medicines,” “How Your Healthcare Team Can Help You Save on Medications” and “Do’s and Don’t’s for Saving Money With Diabetes.”