Thousands of people in Idaho could get health insurance for free next year on the state’s exchange, paid in full by the federal government.
Even some people in Boise who make $40,000 a year will qualify for health plans at a cost of $0 a month — for the kind of insurance that, this year, costs them $154.72 a month. The same phenomenon holds true if you’re in Twin Falls, Idaho Falls or Lewiston.
And some whose income was too high to qualify for premium assistance last year will qualify this year, getting federal aid to cover part of their insurance premiums.
The phenomenon is a ripple effect of a decision by the Trump administration last month to stop funding a special subsidy program created by the Affordable Care Act.
In a bizarre twist, Trump’s effort to yank a pillar from the health care law may end up making it more appealing.
“It’s a really hard concept to really explain, but we certainly have been encouraging people more than ever to use our website, even if it’s just for people to anonymously shop,” said Pat Kelly, executive director of Idaho’s insurance exchange, YourHealthIdaho.org. “You may be able to find more comprehensive coverage for the same cost [as a less-comprehensive plan in 2017] or you may be able to find a bronze plan for virtually nothing.”
Kelly said he recently heard of a person who will get 50 percent more federal assistance to pay for premiums next year. Even though the person’s insurance plan is going to be more expensive, their own share of the premium will be $42 cheaper.
The enrollment window for health insurance on the exchange is a lot tighter this year than it has been in the past. The kickoff was Nov. 1, and the deadline is Dec. 15 — less than six weeks from today.
Insurance agents and staffers from the exchange have been doing outreach, letting consumers know they should jump on the opportunity to get a better deal on health insurance for 2018.
“This year, more than any other year, it may be more affordable than ever,” Kelly said.
Kim Marques, with Compass Benefit Advisors in Meridian, said she is “definitely seeing some interesting situations this year” when she runs the numbers with her clients.
If someone qualifies for help paying their premiums and is making more than double the poverty level, “there are a lot of options with a $0 premium.” Those options “probably have a higher deductible but at least they don’t have a premium.”
How many people will this affect? Tens of thousands.
About 100,000 people get their health insurance from Your Health Idaho, the state’s virtual marketplace for plans under the Affordable Care Act, or Obamacare. The vast majority of those people are in low- or moderate-income households, which makes them eligible for federal aid to cover their premiums — and when they enroll this month for health insurance, they’ll see a bigger chunk of federal funds coming their way to help cover premiums.
How this happened
The Trump administration in October decided to cut off federal funding that paid for a special subsidy created by the Affordable Care Act.
The subsidy helps lower-income people with certain insurance plans more easily afford their deductibles, prescription drug copays and other out-of-pocket costs. It is totally separate from the premium assistance mentioned above.
But Trump’s action only ended federal funding for the out-of-pocket subsidy. It didn’t change the fact that health insurers are still legally required to offer it. And it costs billions of dollars a year across the U.S. So, without another funding source to pull from, insurers built the subsidy costs into their 2018 insurance premiums.
That was the trigger.
The federal aid for monthly premiums is based on the cost of health insurance. So, when insurance got a lot more expensive for the plans that include that special out-of-pocket subsidy, it lifted the premium assistance for every plan on the health exchange — even the plans whose premiums didn’t go up very much.
With the higher aid for premiums, the least-generous “bronze” plan suddenly becomes free, or at least a lot cheaper. And the most-generous “gold” plan becomes so heavily subsidized that it’s within reach for people who couldn’t afford it before.
“I think there’s a lot of general confusion in the marketplace right now, given all of the noise in Washington, D.C.,” Kelly said. “We’ve certainly been out around the state, in Southeast Idaho and North Idaho and the Treasure Valley, really educating consumers. The real challenge is that everybody’s situation is so different, it gets fairly difficult to pinpoint and say, ‘For families in the Treasure Valley, X would happen.’ And that’s why we’re saying the lack of [out-of-pocket subsidy] funding is reflected in our premiums, and because of that, premiums did increase, and so did tax credits.”
None of this does any good for a smaller group — still numbering in the thousands — of Idahoans whose incomes are too high or low to qualify for insurance subsidies. For those Idahoans, health insurance will just be more expensive next year, possibly by a lot.
Someone in Boise who makes $65,000 a year doesn’t qualify for any help. A 62-year-old Boisean with that income will pay about $650 a month next year for a plan with the skimpiest benefits — or $1,000 a month for anything better. His costs will increase anywhere from $30 to $250 a month depending on his level of coverage.
It also does nothing to change the cost of health insurance for the hundreds of thousands of Idahoans who get their coverage outside of the Your Health Idaho exchange.
Your Health Idaho premiums
Thanks to a big increase in premium subsidies, many Idahoans will pay less for insurance in 2018. Here’s what health plans for a single Boise resident would cost, after subsidies are applied.
For a 28-year-old making $28,000 a year
Cheapest bronze plan
For a 45-year-old making $40,000 a year
Cheapest bronze plan
For a 62-year-old making $65,000 a year *
Cheapest bronze plan
* This person would not qualify for income-based premium assistance.