Premiums

Employer Plans in 2022: Premium Growth Remains Steady, Mental Health Concerns Employers

The average annual premium for employer-sponsored health insurance in 2022 was $7,911 for single coverage and $22,463 for family coverage, similar to the average premiums last year, according to the Kaiser Family Foundation 2022 Employer Health Benefits Survey. On average, employees contributed 17% toward single coverage premiums and 28% toward family coverage premiums. Among employees at small firms, 33% of them chose a plan where the employer paid the entire premium for single coverage, compared with only 6% at large firms. Meanwhile, 31% of small firm workers were in a plan that required them to contribute more than half of the premium for family coverage.

Employer Plans in 2022: Premium Growth Remains Steady, Mental Health Concerns Employers

The average annual premium for employer-sponsored health insurance in 2022 was $7,911 for single coverage and $22,463 for family coverage, similar to the average premiums last year, according to the Kaiser Family Foundation 2022 Employer Health Benefits Survey. On average, employees contributed 17% toward single coverage premiums and 28% toward family coverage premiums. Among employees at small firms, 33% of them chose a plan where the employer paid the entire premium for single coverage, compared with only 6% at large firms. Meanwhile, 31% of small firm workers were in a plan that required them to contribute more than half of the premium for family coverage.

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News Briefs: Employer Plan Premiums Hold Steady in 2022

The average family premium for employer-sponsored health coverage changed little this year, going from $22,221 in 2021 to $22,463 in 2022, according to the Kaiser Family Foundation’s 2022 Employer Health Benefits Survey. However, KFF President and CEO Drew Altman said in a statement that “this could be the calm before the storm, as recent inflation suggests that larger increases are imminent.” In addition, despite the minimal year-over-year change, the average family premium has risen 43% since 2012, surpassing the 25% rise in inflation during that time and the 38% increase in wages. The survey also found that the average annual deductible for single this year is $1,763, similar to last year ($1,669) but up 61% since 2012 ($1,097).

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Enhanced Subsidies Drive ACA Enrollment Growth; Assister Programs and Brokers Play Key Roles

Open enrollment for 2023 Affordable Care Act exchange plans starts on November 1, with the Biden administration hoping to continue the enrollment growth seen over the past few years. As of early 2022, about 16.9 million people were enrolled in the individual market, a 20% increase from early 2020, according to a recent Kaiser Family Foundation analysis.

The growth is largely driven by enhanced subsidies enacted by American Rescue Plan Act (ARPA) and extended through 2025 by the Inflation Reduction Act. Overall, about 75% of individual market enrollees are now subsidized. The study estimated that about 3 million people will buy unsubsidized coverage off- marketplace during 2023 open enrollment, a decrease compared to prior years.

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How Would Adjusting the Marketplace Coverage Benchmark to a Gold Plan Affect Affordability?

Changing the Affordable Care Act benchmark plan — which is used to calculate premium subsidies — from silver to gold could lower the national median deductible and annual median out-of-pocket maximum for individual coverage, according to a recent analysis by The Commonwealth Fund.

The bill S.499, introduced by Sen. Jeanne Shaheen (D–N.H.), would set the second-lowest-cost gold plan as the benchmark plan going forward. That would have the biggest impact on people who receive minimal or no cost-sharing reductions. Based on 2022 marketplace data, the median deductible in gold plans was $1,450 — three times less than traditional silver plans with no cost-sharing reductions. Moving the benchmark to gold could also lower the median out-of-pocket maximum to $7,500.

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Part D Bid and Base Premium Will Drop in 2023; MA-PD Enrollment Surpasses PDP for the First Time in 2022

The monthly Medicare Part D base beneficiary premium for 2023 will be $32.74, a slight decrease from $33.37 in 2022, according to CMS. The Part D national average monthly bid amount continues to drop, from $38.18 in 2022 to $34.71 in 2023. Regional low-income premium subsidy amounts have increased over the past few years in most states, yet five states — New York, Illinois, New Jersey, Indiana and Kentucky — are projected to see a decline larger than 5% in 2023. South Carolina is projected to see the biggest jump, with its average subsidy amount going up from $31.12 in 2022 to $37.84.

Part D Bid and Base Premium Will Drop in 2023; MA-PD Enrollment Surpasses PDP for the First Time in 2022

The monthly Medicare Part D base beneficiary premium for 2023 will be $32.74, a slight decrease from $33.37 in 2022, according to CMS. The Part D national average monthly bid amount continues to drop, from $38.18 in 2022 to $34.71 in 2023. Regional low-income premium subsidy amounts have increased over the past few years in most states, yet five states — New York, Illinois, New Jersey, Indiana and Kentucky — are projected to see a decline larger than 5% in 2023. South Carolina is projected to see the biggest jump, with its average subsidy amount going up from $31.12 in 2022 to $37.84.

National Average Part D Bid Continues Downward Trajectory, but for How Long?

In its annual release of the Medicare Part D payment benchmarks and other bid-related information for the coming plan year, CMS on July 29 reported that the national average monthly bid amount will continue a years-long downward trend, dropping to a historic low of $34.71. At the same time, monthly premiums are expected to take a slight dip. While both pieces of information — released by CMS in an effort to help Part D sponsors finalize their premiums and prepare for open enrollment this fall — reflect positive trends and a competitive market, upcoming changes included in the recently passed Inflation Reduction Act of 2022 could start to reverse those trends in the future.

The national average monthly bid amount is a weighted average of the standardized bid amounts for each stand-alone Prescription Drug Plan (PDP) and Medicare Advantage Prescription Drug (MA-PD) plan. Bids were submitted by PDPs and MA-PD plans in early June. CMS said it anticipates releasing the 2023 premium and cost-sharing information for 2023 Medicare Advantage and Part D plans in September.

Extension of Boosted ACA Subsidies May Have Small Impact on 2023 Gross Premiums

Now that the Inflation Reduction Act (IRA) has surmounted the key hurdle of passing the Senate — and is expected to soon pass the House of Representatives as well — the Affordable Care Act exchange market is set for another late-season policy shift that could alter next year’s premium rates. However, experts tell AIS Health that the effect on carriers’ overall premium calculations won’t be as significant as the impact on consumers’ out-of-pocket insurance expenses.

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Health Policy Experts Warn of Consequences If ARPA Subsidies Expire and Medicaid Redeterminations Resume

During the past two years, the number of people enrolled in Medicaid and marketplace plans has significantly increased thanks to legislation meant to help people as the COVID-19 pandemic continues. But millions of those people may lose their health insurance coverage in the coming months if those policies end, which could lead to difficult circumstances for them and the health care industry as a whole, according to health policy experts who spoke during a July 15 webinar sponsored by Alliance for Health Policy, a Washington, D.C., nonprofit.

As of March 2022, nearly 87.9 million people were enrolled in Medicaid or the Children’s Health Insurance Program, up from just over 71.2 million in February 2020, according to the Kaiser Family Foundation (KFF). Sara Collins, Ph.D., vice president for health care coverage and access at the Commonwealth Fund, noted that much of the increase could be attributed to the Families First Coronavirus Response Act (FFCRA).

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