Quinn releases some insurance rates for Illinois
Gov. Pat Quinn's administration gave residents a partial glimpse Tuesday of what they might pay for coverage on Illinois' new health exchange, days before the online marketplace that will help form the backbone of President Barack Obama's health care law opens for business.
Some of the prices are lower than expected, but it's still unclear whether that's because there will be less choice among doctors and hospitals covered in the networks of some plans, or whether a few insurers are simply offering bargain prices hoping to gain customers who will stick with them for years to come.
Quinn's office announced the monthly rates for the lowest-cost plan for a 25-year-old nonsmoker will be $120 in Chicago or $128 in Peoria. For a 40-year-old nonsmoker, the monthly cost of the cheapest plan would be $152 in Chicago or $163 in Peoria. For a 55-year-old nonsmoker, the monthly premium for the cheapest plan would be $266 in Chicago or $284 in Peoria.
Smokers will pay more: a 25-year-old Chicago smoker will pay $132 a month for the cheapest plan, for example.
Illinois is still waiting for final federal approval for 165 health plans offered by eight insurers: Aetna Life Insurance Company, Coventry Health and Life Insurance Company, Coventry Health Care of Illinois Inc., Health Alliance Medical Plans Inc., Health Care Service Corporation (Blue Cross), Humana Health Plan Inc., Humana Insurance Company and Land of Lincoln Mutual Health Insurance Company.
Most Illinois residents will be able to choose from at least 34 plans when the marketplace goes live Oct. 1. In some parts of the state, the choices will be even greater.
Consumers must wait until next week to learn exactly how much they'll pay. New tax credits will lower costs for some, depending on household income.
The lower-than-expected prices publicized by the governor's office are indeed low compared to federal projections, said one independent expert on health insurance pricing.
"People have sharpened their pencils more than probably anyone expected," said David Axene of the Society of Actuaries. But it's likely those low-cost plans won't have broad networks of hospitals and doctors that consumers with good insurance have come to expect, Axene said.
"Prices are lower for reasons," said Axene, an independent actuary from California who reviewed the Illinois information at the request of The Associated Press. Axene, who has examined insurance prices in other states' marketplaces, has seen insurance carriers in those states offering low prices because "instead of having all the hospitals in town they might only have three or four hospitals" in their networks.
Illinois consumers should take care when considering a health plan that their favorite doctors and hospitals accept that coverage, Axene cautioned.
Andrew Boron, the director of the Illinois Department of Insurance, confirmed that some insurers on the state marketplace are offering narrow networks to keep costs low. Details about the hospitals and doctors included in the insurance networks weren't released Tuesday. That information will be available to consumers next week, when the health care exchanges open for business in Illinois and the other 49 states.
It's unclear how long this year's low prices might last, as insurers may be charging low prices to attract customers who they hope to retain when they later raise rates, Axene said. He noted that Illinois released only the rates for the lowest-cost plans, not the full spread of prices from low to high.
Another reason for low prices could be that several insurers offering plans in Illinois have experience as Medicaid managed care providers, Axene said. Those companies -- such as Humana, Coventry and Aetna -- may be using their previous Medicaid experience to negotiate low prices with hospitals and doctors. "Carriers that had a lot of Medicaid business are edging into commercial space," he said.
For now, the governor's office isn't saying which companies are offering the lowest prices.
David From, who heads the Illinois chapter of Americans for Prosperity, a conservative group that opposes the Affordable Care Act, said some consumers will have to pay more for health coverage, including men in their 20s.
"For instance, currently a 27-year-old male can get a policy in Illinois for $90 a month," From said, citing data from the conservative Manhattan Institute. "Now, it'll be in excess of $120 a month."
That's like comparing apples and oranges, said Boron, of the state insurance department. He said comparing policies available now to the more comprehensive policies available under the health care law isn't valid. The health law requires all plans to cover certain benefits, such as maternity care, that were optional in the past. Tax credits will reduce costs for many individuals, Boron said.
"The bottom line is that consumers are going to have robust and affordable options because of the Affordable Care Act in Illinois," Boron said.
Illinois health exchange ratesIn one week, Illinois plans to launch a new health insurance marketplace where consumers can shop online for coverage that's required under the nation's health care law. Until now, the cost of the coverage available on that marketplace has been a mystery.
Gov. Pat Quinn's administration released some cost information Tuesday a week ahead of the marketplace's opening day. Consumers have until Dec. 15 to sign up if they want coverage to start Jan. 1.
About 1.8 million Illinois residents are uninsured. Many of them will qualify for free health coverage under an expanded Medicaid program. Others with low or moderate household incomes will be eligible for tax credits that will drop their costs lower than the rates announced Tuesday.
Here's a look at selected prices of insurance policies expected to be offered on the Illinois marketplace. The rates below are for non-smokers and before tax credits. Smokers will pay more. The rates are for bronze plans, which will have lower monthly premiums but higher out-of-pocket costs such as deductibles and co-pays, and for silver plans, which have higher monthly premiums but lower out-of-pocket costs:
Lowest cost bronze plan:
Cook County: $120 for 25-year-olds, $152 for 40-year-olds, $266 for 55-year olds
Peoria County: $128 for 25-year-olds, $163 for 40-year-olds, $284 for 55-year olds
Champaign County: $166 for 25-year-olds, $211 for 40-year-olds, $368 for 55-year olds
St. Clair County: $134 for 25-year-olds, $171 for 40-year-olds, $298 for 55-year olds
Lowest cost silver plan
Cook County: $165 for 25-year-olds, $210 for 40-year-olds, $367 for 55-year olds
Peoria County: $169 for 25-year-olds, $215 for 40-year-olds, $367 for 55-year olds
Champaign County: $215 for 25-year-olds, $274 for 40-year-olds, $478 for 55-year olds
St. Clair County: $178 for 25-year-olds, $226 for 40-year-olds, $395 for 55-year olds