A 28% premium increase would make health
insurance unaffordable for the average middle-class family of three
with an annual household income between $82,000 and $166,000
A new analysis conducted by eHealth Inc., (NASDAQ:EHTH), finds
that projected rate increases for 2018 health insurance plans would
make health insurance unaffordable, according to the rules of the
Affordable Care Act (the ACA or Obamacare), for 29% of individuals
and 54% of families who bought their health insurance at eHealth
during the 2017 open enrollment period. eHealth operates
eHealth.com, the nation’s first online health insurance
exchange.
The eHealth analysis assumes the same group who bought health
insurance for 2017 bought health insurance for 2018 at the
projected 2018 rates. The analysis also uses federal poverty
guidelines for 2017 to determine the income at which individuals
and families become eligible for Obamacare subsidies.
The Affordable Care Act deems health insurance to be
unaffordable if it costs more than 8.13% of a person’s modified
adjusted gross income (MAGI or household income) to pay for the
lowest cost plan available. In areas of the country where the
health insurance available through government-run marketplaces does
not meet this affordability requirement, individuals and families
can qualify for an exemption from Obamacare’s individual mandate
(the individual shared responsibility tax penalty).
For its analysis, eHealth looked at quoted health insurance
premiums for the lowest cost bronze-level health insurance plan
across all 50 states during the 2017 open enrollment period.
eHealth then added 28% to the quoted monthly premiums to estimate
costs for 2018. This percentage increase is based on estimates
published by Oliver Wyman Health, which projected rate increases
would range from 28% to 40% for 2018 health insurance plans.
With a 28% premium increase, the lowest cost bronze plan
available in 2018 will cost the average unsubsidized family of
three $1,126 a month, which is unaffordable under ACA guidelines
until the family’s household income reaches $166,245.
eHealth then compared those premiums to the self-reported income
of over 2,087 customers who bought their own 2017 health insurance
from eHealth.com and then later provided income information in
response to a voluntary survey. eHealth found that, at projected
2018 prices, Obamacare plans would be unaffordable for 29% of
individual shoppers and 54% of family shoppers in this group.
“What we’re seeing now in Obamacare is death-spiral pricing, and
in many states only the heavily subsidized will be able to afford
coverage in 2018,” said Scott Flanders, CEO of eHealth. “Obamacare
made real improvements in the individual health insurance market by
increasing access to health care for millions of Americans, but it
has proven to be a deeply flawed piece of legislation that needs to
be repaired or replaced in order to help people stay covered.”
Flanders continued: “It’s my sincere hope that our legislators
can put politics aside, work together, and implement meaningful
reforms to the Affordable Care Act so that millions of Americans
are not priced out of the insurance market in 2018.”
eHealth’s Chief Data Officer Ian Kalin said: “It is clear from
eHealth’s customer analysis that entire segments of consumers are
negatively impacted by health care’s unaffordability. I’m very
concerned about those middle-class families that are being priced
out of the individual health insurance market.”
Based on estimated 2018 premiums and ACA affordability
guidelines, eHealth’s analysis projects:
- Affordable insurance: Health
insurance will be unaffordable for 29% of individuals and 54% of
families, according to data from the 2017 eHealth customers that
reported their income in a voluntary survey.
- Individuals: For the average
individual, age 41, health insurance would be unaffordable if they
earn between $48,240 and $71,820 per year.
- Tax credits: Obamacare tax
credits are available to individuals with incomes below $48,240 in
the contiguous United States.
- Families of 2: For the average
family of two, with a head of household age 41, health insurance
would be unaffordable for those who earn between $64,960 and
$150,086.
- Tax credits: Obamacare tax
credits are available to families of two with incomes below $64,960
in the contiguous United States.
- Families of 3: For the average
family of three, with a head of household age 41, health insurance
would be unaffordable for those who earn between $81,680 and
$166,245.
- Tax credits: Obamacare tax
credits are available to families of three with incomes below
$80,640 in the contiguous United States.
- Families of 4: For the average
family of four, with a head of household age 41, health insurance
would be unaffordable for those who earn between $98,400 and
$200,141.
- Tax credits: Obamacare tax
credits are available to families of four with incomes below
$98,400 in the contiguous United States.
Individuals
Age of applicant 2017 lowest cost bronze
(monthly) 2017 lowest cost bronze (annual)
2018 projected bronze (monthly w/ 28%) 2018
projected bronze (annual w/ 28%) 2018 MAGI income
needed to afford coverage 18-24 $202.00 $2,424.00
$258.56 $3,102.72 $38,163.84 25-34
$269.00 $3,228.00 $344.32 $4,131.84
$50,822.14 35-44 $307.00 $3,684.00 $392.96
$4,715.52 $58,001.48 45-54 $416.00
$4,992.00 $532.48 $6,389.76 $78,594.83 55-64
$629.00 $7,548.00 $805.12 $9,661.44
$118,836.90 Average (Age 41) $380.14 $4,561.68
$486.58 $5,838.95 $71,819.81
Two-person families
Age of applicant 2017 lowest cost bronze
(monthly) 2017 lowest cost bronze (annual)
2018 projected bronze (monthly w/ 28%) 2018
projected bronze (annual w/ 28%) 2018 MAGI income
needed to afford coverage 18-24 $395.00 $4,740.00
$505.60 $6,067.20 $74,627.31 25-34
$503.00 $6,036.00 $643.84 $7,726.08
$95,031.73 35-44 $538.00 $6,456.00 $688.64
$8,263.68 $101,644.28 45-54 $773.00
$9,276.00 $989.44 $11,873.28 $146,042.80 55-64
$1,199.00 $14,388.00 $1,534.72
$18,416.64 $226,526.94 Average (Age 41) $794.40
$9,532.80 $1,016.83 $12,201.98
$150,085.90
Three-person families
Age of applicant 2017 lowest cost bronze
(monthly) 2017 lowest cost bronze (annual)
2018 projected bronze (monthly w/ 28%) 2018
projected bronze (annual w/ 28%) 2018 MAGI income
needed to afford coverage 18-24 $652.00 $7,824.00
$834.56 $10,014.72 $123,182.29 25-34
$675.00 $8,100.00 $864.00 $10,368.00
$127,527.68 35-44 $730.00 $8,760.00 $934.40
$11,212.80 $137,918.82 45-54 $951.00
$11,412.00 $1,217.28 $14,607.36 $179,672.32
55-64 $1,297.00 $15,564.00 $1,660.16
$19,921.92 $245,042.07 Average (Age 41) $879.93
$10,559.16 $1,126.31 $13,515.72
$166,245.08
Four-person families
Age of applicant 2017 lowest cost bronze
(monthly) 2017 lowest cost bronze (annual)
2018 projected bronze (monthly w/ 28%) 2018
projected bronze (annual w/ 28%) 2018 MAGI income
needed to afford coverage 18-24 $653.00 $7,836.00
$835.84 $10,030.08 $123,371.22 25-34
$862.00 $10,344.00 $1,103.36 $13,240.32
$162,857.56 35-44 $947.00 $11,364.00 $1,212.16
$14,545.92 $178,916.61 45-54 $1,134.00
$13,608.00 $1,451.52 $17,418.24 $214,246.49
55-64 $1,529.00 $18,348.00 $1,957.12
$23,485.44 $288,873.80 Average (Age 41) $1,059.34
$12,712.08 $1,355.96 $16,271.46
$200,140.99
About eHealth
eHealth, Inc. (NASDAQ:EHTH) owns eHealth.com, a
leading private online health insurance exchange where individuals,
families and small businesses can compare health insurance products
from leading insurers side by side and purchase and enroll in
coverage online. eHealth offers thousands of individual, family and
small business health plans underwritten by many of the nation's
leading health insurance companies. eHealth (through its
subsidiaries) is licensed to sell health insurance in all 50 states
and the District of Columbia. eHealth also offers
educational resources and powerful online and pharmacy-based tools
to help Medicare beneficiaries
navigate Medicare health insurance options, choose the
right plan and enroll in select plans online through Medicare.com
(www.Medicare.com), eHealthMedicare.com (www.eHealthMedicare.com)
and PlanPrescriber.com (www.PlanPrescriber.com).
For more health insurance news and information, visit
eHealth's Consumer Resource Center.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170622005375/en/
DMA Communications for eHealth, Inc.Sande Drew,
916-207-7674sande.drew@ehealth.comoreHealth, Inc.Nate Purpura,
650-210-3115nate.purpura@ehealth.com
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