Exchanges to provide dozens of health care options for Pittsburghers

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WASHINGTON -- Pittsburghers will have dozens of plan choices when the Affordable Care Act marketplace opens Tuesday, and competition from health insurers means premiums nationwide will be lower than expected, according to a new administration report.

The lower premiums primarily affect mid-range coverage under so-called "silver" plans that cover 70 percent of medical costs.

A Pittsburgh family of four with an income of $50,000, for example, could enroll in a silver plan for $282 a month after receiving the income-based federal subsidy, according to the report. Without a subsidy, the monthly premium would be $505.

A 27-year-old Pittsburgher earning less than $25,000 would pay $139 for a silver plan, with or without subsidy.

Premiums (before subsidies) are turning out to be 16 percent less than the Congressional Budget Office predicted in March 2012. The U.S. Department of Health and Human Services came up with the 16 percent figure after analyzing information from the first 16 states that provided information about proposed or final premiums for the insurance exchanges.

That's good news to HHS Secretary Kathleen Sebelius, who announced the findings to reporters on a conference call Tuesday.

"In the past, consumers were too often denied or priced out of quality health insurance options, but thanks to the Affordable Care Act, consumers will be able to choose from a number of new coverage options at a price that is affordable," Ms. Sebelius said. "For many Americans, these new options will finally make health insurance fit their budget."

Republicans like U.S. Rep. Fred Upton of Michigan have been wary of the administration's figures, saying it has been using "creative arithmetic," and that premiums for existing policies are skyrocketing as carriers are forced to comply with the Affordable Care Act.

Some provisions of the law are increasing costs by, for example, requiring coverage of pre-existing conditions and blocking lifetime limits on treatment for substance abuse and mental health services.

Current rates can't easily be compared with those available through the exchanges because of those sorts of requirements and because of variations in plans, said Gary Cohen, deputy administrator and director of the Center for Consumer Information and Insurance Oversight.

Nationally, 95 percent of consumers will be able to choose from among plans offered by at least two different providers, although some areas of the country, including regions of West Virginia, will have only one available insurance provider, administration officials said.

On average, Pennsylvanians will be able to choose from among 56 coverage plans, although the choices will vary by region. Thirty-six plans will be available in Pittsburgh and 42 in Philadelphia, according to the HHS report.

Plan details won't be available until Tuesday when the insurance exchange opens.

The average price of the least expensive "bronze" plan available for Pennsylvanians, which would cover 60 percent of medical costs, will be $229 a month. That's slightly less than the national average of $249 for bronze-level plans.

Mr. Cohen said prices vary according to the amount of competition from insurance providers and the cost of medical care in each state.

Consumers need to look at more than the premium, Mr. Cohen said. They also must evaluate the coverage offered and what their out-of-pocket costs will be for the health care they expect they will need.

"They'll be able to select the characteristics of the different plans they want to see," he said. "It's going to be a very good and transparent shopping experience."

Some critics have questioned whether companies are able to reduce rates because they are limiting the number of in-network doctors and hospitals patients can visit.

Mr. Cohen countered that all plans are required to have provider networks large enough to sufficiently serve their enrollees.

He and Ms. Sebelius said rates under the exchange will make insurance more affordable and more accessible than ever before.

They attributed the lower-than-expected premiums to competition and transparency.

"There is an anticipation of a lot of new entrants into the market, so insurers are competing for all this new business coming into the market, and insurers know people have to easily be able to compare side-by-side what the benefits and costs of the different plans are," Mr. Cohen said.

Even as he and Ms. Sebelius touted the Affordable Care Act's success in reducing premiums, Texas Republican Ted Cruz began a filibuster on the Senate floor Tuesday afternoon. He and other conservatives are trying to block a budget bill, forcing a government shut-down if colleagues won't agree to defund the Affordable Care Act.

Senate Minority Leader Mitch McConnell, R-Ky., also wants to block implementation of the act, one the president's proudest domestic policy achievements.

"Every week it seems there are new reports about glitches that will hurt families, compromise personal information, or expose the American people to fraud," Mr. McConnell said.

"There's only one escape hatch that will fully help those trapped by this law -- and that's full repeal," he said.

Mr. Cohen said a shut down -- which could occur Tuesday, the same day the marketplaces open -- wouldn't affect the start of insurance enrollment because it is funded through a mandatory appropriation.

Agency employees, including newly hired "navigators," are ready to help consumers choose the right plan for them, Mr. Cohen said.

"We recognize this is an important decision for consumers to make and we expect they will take a look at it, see what's available and come back to make the best decision for them and their families," Mr. Cohen said.

Those who sign up by Dec. 15 can have coverage begin on Jan. 1. The individual mandate that requires people to carry health insurance kicks in April 1.

After that, the uninsured will face an annual penalty of $95 or 1 percent of their taxable income, whichever is greater.

Exemptions are available to people opting out for religious reasons, for those who would have to spend more than 8 percent of income on insurance and for those who qualify for coverage under the federal Medicaid expansion but who live in states such as Pennsylvania that haven't agreed to accept more federal dollars to enroll more people with higher incomes.

Federal subsidies will be available to people with incomes less than 400 percent of the federal poverty level. That's $45,960 for an individual, for example, or $94,200 for a family of four.

In Pennsylvania, a 27-year-old could buy catastrophic insurance for $125 a month or could choose a "gold" plan covering 80 percent of medical expenses for a premium of $205 a month. Those earning less than $25,000 a year would be eligible for a subsidy to bring monthly premiums below $109 a month for a "bronze" plan covering 60 percent of expenses.

Most entrants to the marketplace are expected to qualify for subsidies because most uninsured people are unemployed or have low-wage jobs that don't offer health benefits, agency officials said.

More information about the marketplace can be found at www.healthcare.gov.

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Washington Bureau Chief Tracie Mauriello: tmauriello@post-gazette.com, 703-996-9292 or on Twitter @pgPoliTweets.


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