Pennsylvania health insurers are proposing an average 7.1% increase in monthly premiums starting in January for the 375,000 individuals who get coverage through the online state Affordable Care Act marketplace, the state Insurance Department has announced.
The department has authority to modify the rate requests and was continuing to review the rates sought by insurers, which include an average 5.2% increase for small groups. Final rates for consumers will be released in the fall.
“Increased choices and plan options will provide Pennsylvanians with the opportunity to shop for the best coverage options for themselves and their families,” acting Insurance Commissioner Michael Humphreys said in a prepared statement. “As we navigate through the aftermath of the COVID-19 pandemic, Pennsylvania continues to have a strong and competitive insurance market.”
Insurers attributed the rate increases to rising health care costs, projected claims due to deferred care resulting from the pandemic and the end of enhanced premium tax subsidies. A U.S. Senate vote is expected soon on a bill dubbed the Inflation Reduction Act of 2022, which would extend premium subsidies for three years.
If negotiations break down, consumers could see significant increases in monthly premiums next year, insurance brokers have said.
Federal American Rescue Plan funding cut out of pocket premium costs by an average of 9% in 2022. The funding expires at the end of the year.
Enrollment through Pennie, the state’s online marketplace for Affordable Care Act coverage, also known as Obamacare, rose 11% in 2022 compared to a year ago, which included more than 35,000 middle income individuals who qualified for financial assistance for the first time. Average monthly savings were $252.
As a result of the higher subsidies in 2022, Pennsylvania’s uninsured rate fell to 5.4%, the lowest rate of uninsured ever.