Sounding the Alarm on Health Insurance Premium Hikes

Sounding the Alarm on Health Insurance Premium Hikes
By Jayme H. Simões, President, Louis Karno & Company Communications, LLC Strategic Communication

Next year, millions of Americans will see dramatic increases in their health care costs if Congress fails to extend the enhanced premium tax credits in the American Rescue Plan — and millions will no longer be able to afford insurance. The first glimpse into how these increases will play out across the country arrived last month when private insurers in Vermont proposed rate increases as high as 24 percent.

What is happening in Vermont should serve as a wake-up call. Similar premium price hikes are what Americans have in store if the premium savings provided in the American Rescue Plan are not extended. Experts say insurers are likely to seek double-digit increases in state after state due to supply chain shortages, projected COVID costs, and increased hospital costs.

Congress must move swiftly to prevent skyrocketing premium increases and protect health coverage for millions.
The American Rescue Plan saved American families thousands on their premiums. Still, the expanded tax credits that powered those savings will end this year, driving up 2023 premiums for Americans who buy insurance on their own. This will force nearly nine million Americans to pay significantly more for their health coverage and cause three million to become uninsured.

Open enrollment for 2023 plans begins on November 1, 2022, a week before Election Day, and rate increases are locked in during summer and fall. If Congress does not act, news of premiums skyrocketing will be front and center just as Americans begin signing up for coverage and as people go to the polls in November.

If Congress Fails to Act:

  • Millions Will Lose Coverage. More than 3 million people will become uninsured if the American Rescue Plan's enhanced premium tax credits expire—increasing the number of uninsured Americans by 11 percent.
  • Premium Increases Will Be Widespread. Insurers are already pursuing double-digit premium increases. Nearly nine million Americans will retain their marketplace coverage but will be forced to pay significantly higher rates.
  • Geographic And Racial Disparities Will Grow. Three states—Florida, Georgia, and Texas—will make up half of the increase of uninsured Americans if the tax credits are allowed to lapse. Americans living in rural areas, like West Virginia, will suffer disproportionately, with an average of 10 percent higher premiums than in urban areas.

Timeline For Premium Increases:

  • Currently Underway: Insurance providers are currently negotiating premium rates for 2023. If Congress does not act to extend the ARP's premiums savings, insurers will be forced to assume the tax credits will expire at the year's end, resulting in sizable premium price increases. Private health insurers in Vermont have already requested approvals for double-digit premium increases from state regulators in 2023.
  • July: Many premium rate changes on state exchanges will be finalized and made public beginning in July.
  • September & October: Insurers planning to offer health plans on the ACA marketplaces are required to submit their premiums for 2023 to state or federal regulators. Enrollees will be notified of plan price changes officially in September and October, with rates required to be finalized by October 15.
  • November 1: The annual open enrollment period for ACA marketplaces begins November 1.
  • November 8: Election Day is November 8, one week after open enrollment for 2023 is set to begin.
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