Maryland released their final ACA rates yesterday. The average non-subsidized rate will decrease by 13.4 percent for anyone who does not age.
Maryland was one of the first states out of the gate with preliminary rate hikes this spring. The early projection was an average of a 30% increase with one insurer wanting a 91% spike.
So what happened?
Charles Gaba has a good summary that I want to extend on:
Thanks to swift, bipartisan action on the part of the Democratically-controlled Maryland state legislature and the Republican Governor, Maryland was able to pass several bills which partially negated or cancelled out Trump/Congressional Republican sabotage of the Affordable Care Act. In particular, they passed laws which locked in current restrictions on both short-term plans and association health plans (the types of “junk policies” which Trump is pushing hard to expand upon)…along with an extremely robust reinsurance program….
It is also a timing issue. For an insurer to file preliminary rates for May 1, they can only use claims through about April 15th to see what the recent past implies about the near future. This creates a run-out problem. An insurer will have 95% of January,90% of February, 50% of March and a handful of April claims. If policy is fairly consistent, insurers will have well developed seasonality adjustment factors that will be usefully wrong.
Policy has not been consistent. Insurers were dealing with trying to project the CSR population, they were trying to project the impact of no individual mandate and they were trying to figure out the impact of short term limited duration rules. They were doing this on maybe 60% of the actual claims of a little more than a quarter of the year where consumer behavior due to Silver Loading and Gold Gapping was going to be different than previous years.
And then policy continued to change over the summer. Maryland applied for and received a waiver for reinsurance which injects significant new money into the claims payment pool that does not come from premiums. Maryland added certainty regarding short term limited duration plans. CMS did not ban Silver Loading and the claims information coming in allowed actuaries to firm up their projections as the worst case scenarios that justified 2018 pricing has not come to pass.
With Maryland coming in as a reduction, this is the end of the potential rate shock story.
different-church-lady
That’s a really rare and fortunate group, no?
PAM Dirac
Do you have any idea what the exact bills were that Maryland passed? Link in the text goes nowhere. I assume Health Insurance – Individual Market Stabilization (Maryland Health Care Access Act of 2018) is probably at least one of them. I ask because I am volunteering for someone running against a MD state senator and he voted against the bill. It sounds like the deal is: National repubs screw up Obamacare regs -> estimated 30% increase in insurance rates -> MD democrats provide some fixes (no thanks to mr. incumbent )-> 13% decrease insurance rates. If that is fair assessment of reality, we should really hammer him on it.
p.a.
@different-church-lady: I’ve been trying like he’ll just to get on that waiting list.
dnfree
@different-church-lady: Actually, anyone who does not age is most likely dead.
different-church-lady
@dnfree: Well, that would explain the premium decrease.
Fred Fnord
@dnfree: Hey, what about us vampires?
David Anderson
@different-church-lady: it is a snarky line as there is an age adjustment factor of 2% to 3% every year. So someone with a plan that had “no change” will see a bump
burnspbesq
Yo, California Legislature: pay attention. This is how it’s done, not by DeLeon’s half-assed, pie-in-the-sky-in-the-sweet-by-and-by nonsense.
wkwv
Marylander here, PAM Dirac, which state senate race is that?
PAM Dirac
@wkwv:
District 4. Frederick County and part of Carroll county. Right now the Senator (Michael Hough) and all 3 delegates are repubs. Hough is a real piece of work, wingnut welfare since he got out of college and worked for ALEC. His full time job is chief of staff for Alex Mooney, Freedom Caucus member from West Virginia.
It is obviously no where near the most important race this fall, but anywhere you can turn red to blue is a plus. I have found it very enjoyable to volunteer. Most of the people feel so much better working to change things instead of moping and worrying. Also the races are small enough to be personal, rather than consultants and ad buys. The repubs are so narrow, mean, and small it is a big relief to have people that are smiling. It is also a big plus that the Democratic candidates are smart, energetic, and nice, and hard working. If any jackels have money left over from air conditioner relpacements, you might drop by https://douglass4senate.com/ or https://bravo4md4.com/ and Lois Jarman and Darrin Ryan Smith.