The premiums for 2018 Marketplace plans were recently released to give consumers a chance to look at their plan options before open enrollment begins on November 1. Premiums are rising significantly in many counties across the country, in part due to the decision of the Trump Administration to cease payments to insurers for cost-sharing reductions. Insurer participation also declined in many areas, leaving more counties with only one insurer, which likely contributed to the high rate of premium growth.
The map below illustrates how premiums changed for 2018 by looking at the change in the lowest-cost bronze, silver and gold plans by county in states participating in the federal Marketplace. Results are shown for a 40-year-old paying the full premium and for a 40-year old with an income of $25,000 (207% of poverty), $30,000 (249% of poverty), $35,000 (290% of poverty), and $40,000 (332% of poverty), who would be eligible for a premium tax credit.
Percent Change in Lowest-Cost Metal Plan Before and After Tax Credit, 2017-2018
Nationally, the unsubsidized premium for the lowest-cost bronze plan in the federal Marketplace is increasing an average of 17% between 2017 and 2018, the lowest-cost silver plan is increasing an average of 35%, and the lowest-cost gold plan is increasing an average of 19% (Table 1). These average increases are weighted by the number of plan selections by county in 2017 (see Methods). Premiums for silver plans are rising much more than those for bronze or gold plans because in many states insurers loaded the cost from the termination of the cost-sharing reduction payments entirely on the silver tier.
For consumers who receive premium tax credits, the amounts that they will have to pay will often be lower in 2018 (Table 2). The particularly large increase in premiums for silver plans means that tax-credit-eligible Marketplace enrollees will see much higher premium tax credits (which are calculated based on the second-lowest-cost silver plan in each area). These large credits make gold plans more easily attainable and make bronze plans much cheaper (or even available at no additional premium). In fact, after these increases, the lowest-cost gold premium is lower than the lowest-cost silver premium in 459 counties.
For example, a 40-year-old individual making $35,000 (249% of poverty) and eligible for a tax credit will on average pay 39% less in 2018 for their share of the premium for the lowest-cost bronze plan, 7% less for the lowest-cost silver plan, and 13% less for the lowest-cost gold plan. The savings are greater for subsidized enrollees with lower incomes and less for those with higher incomes (Table 2). The premiums for bronze plans may be particularly attractive to many people eligible for premium tax credits. For example, the tax credit for a 40-year-old individual making $25,000 covers the full cost of the premium for the lowest-cost bronze plan in 1,540 counties.
Counties Where the Lowest-Cost Bronze Plan Premium Costs Zero Dollars After the Tax Credit in 2018
The map below shows counties where the unsubsidized premium for the lowest-cost gold plan has a lower or comparable premium to the lowest-cost silver plan in 2018.
Counties Where the Lowest-Cost Gold Plan Costs Less than the Lowest-Cost Silver Plan
The differences in premium changes across plan types and the peculiar effect these differences have on plan costs for both unsubsidized and subsidized enrollees makes it important that consumers shop around and carefully consider their options. Although CMS will no longer be paying insurers for reducing the cost sharing for lower-income enrollees, insurers remain obliged to provide the reduced cost sharing policies to eligible Marketplace enrollees. These policies generally have higher actuarial values than gold plans for enrollees with incomes below 200% of poverty so consumers will need to carefully consider whether it makes sense to switch even though gold-plan premiums may be comparable or less than silver plans. Consumers eligible for cost sharing reductions also will need to weigh the much lower premiums they would pay for a bronze plan with the much higher cost sharing they could encounter if they need care.