The benefits of Obamacare are becoming even clearer. Recently, two of the four major DC insurers lowered proposed premium rates for health plans they will offer on the District’s Health Benefit Exchange starting in October. The two rate filings — submitted to the Department of Insurance, Securities, and Banking (DISB) — dispel fears that the District’s exchange policies would dramatically raise prices for small businesses. Instead, the recent news adds another piece of evidence that federal health reform increases transparency, leading to more competitive health plan pricing that rewards consumers.
Earlier this summer, the DC Council voted to make the Exchange, now known as DC Health Link, the sole marketplace for selling health insurance plans to individuals and small businesses. Online marketplaces allow consumers to compare plans side-by-side, and District lawmakers believed the exchange would add transparency and competition to the entire market, increasing quality and driving down prices.
The District’s decision seems to be yielding results. Since an initial rate filing in June, UnitedHealthcare and Aetna have resubmitted new and lower rates for small-employers in order to more closely align with competitors. UnitedHealthcare lowered its rates by an average of 10 percent. This will reduce monthly employee premiums from $264 to $237 for an average HMO plan with a moderate level of employee cost-sharing. Aetna lowered rates by 5 percent on average, but still has lower HMO rates than United — with a comparable firm paying about $218 per month.
Now that businesses can see what plans will look like in 2014, DC Health Link and their partners are conducting a massive outreach effort to educate individuals and employers about the benefits of exchange plans. Already, Health Link has secured partnerships with the DC Chamber of Commerce and the Greater Washington Hispanic Chamber of Commerce to do business outreach. Health Link also will sponsor town hall meetings with different communities around the city to educate new consumers, answer questions, and clear up misconceptions.
The fact that the 2014 rates filed for DC Health Link are not dramatically different from today’s rates should help calm fears that the District’s health reform efforts would drive rates up, known as “rate shock.” Instead, businesses will probably get a better deal than they do today, as quality increases and prices remain flat.
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