Obamacare Premium Hikes: What’s Actually Happening in Ohio

We’ve all heard the different predictions of what to expect next year in the Buckeye state: “premiums are going to skyrocket! Yes they are going  up. Wait! They’re actually going to decrease!” With all these mixed messages circulating through the media as to what we can expect our premiums to be next year, which are consumers suppose to believe?

What should Ohioans expect with Obamacare for 2016?

The truth of the matter is that everyone, whether you purchase your plan through an exchange or have coverage through work, is going to pay more for their Ohio health insurance next year. Health insurance goes up every year the result of continuously rising medical costs; it’s the nature of the beast. However, there is good news.  From what information is available, it does not appear that premiums for Ohio health insurance are going to double or go through the roof.  What Ohioans can expect is that their insurance premiums next year will increase around 8% according to a nationwide average, slightly lower than the annual 10% rate hikes that were pre-Obamacare.

            Various states are projecting a wide range of increases from 13.2 percent for some plans in Florida to just 2.5 percent in Indiana. So why is there such a drastic variation by location? Some of the price hikes are Obamacare-related, some are simply a rise in the cost of medical care. Some states with lower premiums experience such because there are multiple insurers competing in that state.

So what effect does Obamacare have? The most important change that we will see this year is that Obamacare allowed consumers with pre-existing conditions to enroll, projecting that they would incur higher medical costs that would need to be offset by the young and healthy. However, the amount of enrollees under the age of 35 is significantly lower than what was projected and neeed. Because the initial enrollment did not end until spring, insurers still don’t know 100% what their new customers cost them. This is one of the main reasons behind companies rising or cutting rates. Last year they guessed wrong and either put premiums too high or too low in order to compete on the exchanges. An increase in competition in some states is what will be a major deciding factor in keeping rates down.

 Overall, residents of Ohio do not have to panic that Obamacare rate hikes are going to burn holes in their wallets. Increases should average less than 25% and the majority of those enrolled in Obamacare will see their increase offset by their tax subsidies.

Tracy McManamon on Google+