Three large insurance companies are planning to offer health policies to individual Oklahomans at rates ranging from less than $100 to more than $1,000 per month through the new insurance marketplace being set up under the Affordable Care Act, also known as Obamacare.
The rates posted by Aetna Life Insurance Co., Blue Cross Blue Shield of Oklahoma and Coventry Health & Life Insurance Co. for policies they will offer under the health care law vary widely based on age, geographic location, tobacco use and plan type.
The lowest rate is $61 per month for a Blue Cross Blue Shield policy that requires buyers to pay virtually all of their medical expenses up to $6,350 per year. It would apply only to people below the age of 21 who live in central Oklahoma or Comanche County, which includes Lawton.
At the upper end, a $1,241 monthly rate would apply to smokers over the age of 63 who live in the Lawton area and who choose an Aetna Premier policy with a $2,000 deductible and $10 co-pays for routine doctor appointments.
The rates posted by the insurers do not take into account federal tax credits that will reduce the net cost to many buyers by hundreds of dollars, and in a few cases to zero, depending on their income.
“This is an enormous change,” said Deputy State Insurance Commissioner Mike Rhoads. “Now everybody has the assurance regardless of their health insurance that they can get coverage … It's the largest change with respect to health insurance since the passage of Medicare and Medicaid in 1965.”
Rhoads expressed concern that the rates posted by insurance companies for the new marketplace appear to be consistently higher than those charged for existing plans, although federal tax credits will soften the blow for most people.
The Oklahoma figures appear to compare favorably with Obamacare rates in other states.
Aetna, for example, said it will charge $302 a month for a benchmark “silver” plan sold to a 40-year-old nonsmoker living in the seven-county Oklahoma City metropolitan area.
That falls below the $320 average that the Congressional Budget Office projected for benchmark silver plans nationwide. A recent study of rates posted in 17 states showed a range of $212 in New Mexico to $413 in Vermont for comparable plans.
Under Obamacare a silver plan is designed to cover 70 percent of all medical costs incurred by an average policy holder. In Oklahoma, the $302 rate applies to an Aetna Classic policy with a $5,000 deductible, $30 co-pays for routine physician services and 30 percent patient cost-sharing for hospitalization.
Cheaper rates apply to “bronze” and catastrophic plans that require policy holders to pick up more of the tab. A 40-year-old nonsmoker in central Oklahoma will pay $239 a month for an Aetna Advantage plan that offers almost no reimbursements until holders exceed a $6,350 deductible.
Based on the three companies' rate filings, it appears most marketplace customers are likely to wind up with policies that cost somewhere in the range of $200 to $700 a month, before tax credits.
The biggest variable is age. The Affordable Care Act allows insurers to charge three times as much to cover a 64-year-old as they charge a 21-year-old for the same plan. All of them appear to be doing so.
Aetna's rates for its benchmark silver plan start at $150 per month for people below the age of 21 in the Oklahoma City metro area. Those aged 21 to 24 will pay $236. The rates rise to $268 for 30-year-olds, $302 for 40-year-olds, $421 for 50-year-olds, $640 for 60-year-olds and $707 for 64-year-olds. Medicare takes over at age 65.
Another variable is tobacco use. Smokers will pay 10 percent more than nonsmokers for Aetna's policies, 20 percent more for Coventry's policies and anywhere from 10 percent to more than 30 percent for Blue Cross Blue Shield's plans.
Geographic location is a factor, too. Under Obamacare, Oklahoma has been divided into five regions. Insurers are allowed to charge different rates in different regions based on their claim histories and projected costs.
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Applying for coverage
The marketplace will begin accepting applications on Oct. 1 for coverage that begins on Jan. 1, 2014. The federal government already is pre-registering applicants through its marketplace website, www.