The Utah Insurance Department announced their rates for next year’s Obamacare health plans on Thursday. It’s a significant increase, but it won’t affect everyone equally.
Each year health insurance companies have to set the rates for how much their plans will cost in the coming year. Those rates were published by the Utah Insurance Department on Thursday.
Tanji Northrup is the assistant commissioner at the Utah Insurance Department.
"In the individual market is the most significant increase that we’ll see. On average the rates will go up about 39 percent," she says.
Here’s why: Northup says a big reason rates are going up this year is because the federal government has not yet agreed to pay a type of subsidy to insurance companies. They’re called cost-sharing reductions. The insurers are saying ‘we’re going to raise the rates because we’re not getting the money we usually get from the federal government.' Consumers will effectively end up paying the difference.
But Northrup also says it won’t affect everyone with Obamacare plans equally.
"The easiest way to say it is anyone who is buying a silver plan, on exchange, and they’re not receiving a tax credit, needs to look for plans off exchange."
She says people who already get tax credits will get more of them, so they won’t feel the rate change as much. In this case, silver plans without tax credits will be most affected.
According to the Utah Health Policy Project, the increase will affect approximately 6 percent of Utahns. That's the group who have health insurance through Utah’s Obamacare marketplace. Select Health and University of Utah Health Plans will offer Obamacare plans next year.
Northrup also says this could all change if Congress decides to fund the cost-sharing reduction payments and allows insurers to reset their rates.
"Everything could change next week as far as I’m concerned, I just don’t know," Northrup says.
Individuals who are concerned should work with tax professionals to decide what plan will be best for them next year.