Health Plan Price List Has N.J. Guessing

The Record ( — Wednesday, September 25, 2013

The Record

The lower-than-expected cost of health coverage in New Jersey's new insurance marketplace surprised experts Wednesday, who had their first look at the impact the Affordable Care Act will have on its most important target group — the uninsured.

While premiums will be higher in New Jersey than in most other states, they will still be attractive to many, health policy experts said.

In fact, the premium for family coverage with a benchmark plan will be less than half the cost of the most popular plan currently available for people who buy their own coverage — $943 a month for a "silver plan," compared with $2,279. "That's a pretty stunning difference," said Joel Cantor, director of the Rutgers Center for State Health Policy.

With federal subsidies, that coverage will be "dramatically more affordable," he said: $242 a month for a family of four earning $50,000 annually, or approximately one-tenth of the cost of buying the most popular current plan.

"It's better than I expected," Cantor said. He cautioned, however, that the details of copayments and deductibles and the network of doctors and hospitals patients can choose from are not yet known, so it is difficult to make comparisons.

With just days to go before the new online marketplace opens to consumers on Tuesday, the federal government on Wednesday gave a glimpse of the options available to consumers and a sampling of their premiums. The New Jersey premium for family coverage was the sixth-highest in the nation, according to the report.

Only those who are currently uninsured or buy coverage for themselves will be eligible to use the marketplace created under the Affordable Care Act. People with Medicare, Medicaid or employer-sponsored coverage will keep that insurance. Coverage will begin on Jan. 1 for those who apply before Dec. 15, and open enrollment will continue through March.

As the federal government released a sample of premium information for the 36 states whose marketplaces it will run, there were still a host of unanswered questions.

The information the government provided was from mid-September, before one of the insurance companies that was going to offer coverage on the New Jersey marketplace decided to pull out. Aetna's decision to withdraw from the state marketplace could mean that some of the sample premiums the government provided for New Jersey will actually be different.

"There will be glitches," David Simas, special assistant to the president, told reporters Wednesday. "When glitches arise, we will fix them."

The new law known as Obamacare created a market-based insurance system that didn't exist before, he said. On Oct. 1, people can begin to shop in that new market, regardless of whether there's a government shutdown.

New Jersey has always been a high-cost state for health care, with some of the highest charges in the nation for hospital care and other services, and patients who visit specialists and undergo expensive treatment more frequently. Premiums reflect the underlying costs for physician and hospital services and prescription drugs, and those costs continue to rise in New Jersey, said Horizon Blue Cross Blue Shield spokesman Tom Vincz.

Horizon will be offering five different plans on the marketplace through a limited network of doctors and hospitals, he said.

The prices of the new plans, when coupled with the subsidies provided through tax credits, are designed to encourage people to buy coverage.

"We expect hundreds of thousands of people to get it," said Maura Collinsgru of New Jersey Citizen Action. "It's good news for New Jersey." About two-thirds of the state's 900,000 uninsured will be eligible to buy coverage in the new marketplace.

But opponents of the health care law say it creates a new entitlement that the nation can ill afford.

"The money for the subsidies has to come from someplace," said Mike Proto of the New Jersey chapter of Americans for Prosperity, affiliated with the Tea Party. "Of that $1.1 trillion for subsidies, some comes from New Jersey taxpayers."

Another unknown is what the premiums will be for small-business plans to be offered on the federal marketplace. Some small businesses with existing coverage say they are already seeing the effects of Obamacare — and it's not what they expected.

Steve Nickles, a physician in a group practice in Ramsey, said his office had just received notice of the need to change the plan that covers the four doctors and their employees to comply with the Affordable Care Act. Premiums will go up, as well, he said.

"This is not what Obama promised," he said.

But the government's report Wednesday showed that young, healthy residents — the customers needed to help insurance companies spread the costs of covering newly insured sick people — should find the new premiums attractive. They will be able to buy more comprehensive coverage than currently available through the state's bare-bones plans for little difference in cost.

A 27-year-old man or woman will pay $186 monthly for a catastrophic plan, $219 for a bronze plan that covers 60 percent of overall health costs, and $253 for a silver plan that covers about 70 percent of overall health costs. That compares with premiums for the most popular current plans — which limit coverage for doctors' visits to $700 and out-of-hospital care to $500 — and cost $163 for men and $199 for women. With subsidies, those new premiums will drop to $103 for a bronze plan and $145 for a silver plan.

That may be attractive to Maggie Bromley, 25, a part-time home health care worker from Moon\0xADach\0xADie who doesn't have insurance. Her husband lacks it, as well. They're not sure they'll buy it after the Affordable Care Act is implemented, she said.

"If it's going to be more than $100 or $150, we can't afford it," she said. "The economy isn't picking up and some people can't even afford to pay their bills. Maybe down the road, we'll think about it."

Even if people like Bromley don't buy the insurance, they could still end up paying: Most of those who choose to go without insurance next year will be fined $95, more in later years.

Nicholas DeMaria, also of Moonachie, works full time at a moving company but isn't offered insurance and said he can't afford it on his $10 hourly wages.

"I don't know much about this new law but I would like to get insurance," he said. "I try to avoid doctors. I can see this insurance being a really good thing."

Washington correspondent Herb Jackson and Staff Writer Barbara Williams contributed to this report.

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