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ACA – a little perspective on who’s going to win

Premiums are SKYrocketing!

Deductibles are HUUUGE!

Insurers are DROPPING OUT!


Can’t we all just chill for a minute?

Truth is, premiums in the individual marketplace today are lower than they were a couple years ago.

Yes, rates are going up, but the proposed rate increases are:

  • lower than historical trend rates
  • still to be approved by regulators
  • not as big a deal as one might think because consumers are shopping around and getting better deals
  • for plans that cover 17% more benefits than pre-ACA plans

To be fair, deductibles and coinsurance costs are much higher than pre-ACA, continuing a trend that’s been around for years.

My take is these economic cost control mechanisms are going to run their course, and we’ll see much more focus around care management and network management going forward.

That said, isn’t this EXACTLY what we were supposed to get from consumer-driven health care plans?  Insurers that are using economic levers to incent consumer behavior, narrowing networks to use buying power to get lower prices and focusing care management efforts on the 5% that generate 50% of costs will succeed, those that don’t understand this market or how to compete will fail.

What does this mean for you?

Expect health plans totally committed to the new health care market to win.  And that success will make them much tougher competitors in the group health market in years to come.

Watch out, Anthem, UHC, and Aetna


3 thoughts on “ACA – a little perspective on who’s going to win”

  1. What seems to be quite lost in all these discussions on rates is the fact that the policies being sold today on, despite having broader coverage of healthcare needs, shift enormous amounts of costs to the member through higher copays, deductibles, and max out of pocket costs than the plans we offered in 2013. There simply is no comparison to the risk the marketplaces shift to the customer, especially if the customers makes more than 200% of FPL, where cost sharing reductions simply do not begin to cover the changes.

    The proposed rate increases are certainly NOT lower than historical rate trends, especially in our state, where we moved from an annual rate increase on individual plans of 7.5% to 27%. Some of that is offset with subsidies among the poorest customers, but underwriting changes shift even more cost to families.

    You can check it out here. It’s often not a great deal.


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Joe Paduda is the principal of Health Strategy Associates




A national consulting firm specializing in managed care for workers’ compensation, group health and auto, and health care cost containment. We serve insurers, employers and health care providers.



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