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Rates Released for Health Insurance Exchange

By Jeffrey Hess | Published 26 Sep 2013 07:47am | comments

The premiums for private insurance plans on the new federal insurance exchange in Mississippi are coming in lower than expected. But, a lack of competition and poor public health could be driving up rates.

 Rates for the benchmark plan for a Mississippi family of four making $50,000 dollars a year are higher than all but two states, Alaska and Wyoming, on the federally operated healthcare exchange, costing over $1,000 dollars a month.

It is important to note, that while the initial rate is higher most people will have access to tax credits that will bring the average cost down to $282 a month for the family.

Therese Hannah with the Mississippi Center for Health Policy says the increased rate is probably because only two companies are selling subsidized insurance on the exchange in the state.

"I suspect that it is because of a lack of competition. We only have two insurers offering through the exchange here. And in some areas there is just going to be one. Insurance companies tend to be a little conservative when they are trying to project rates for an unknown population. So if they are the only insurance company they are going to be fairly conservative, particularly if they don't have to compete with another company," Hannah said.

Most counties in Mississippi will only have access to policies offered by one insurer…only four counties will be able to choose between the two companies.

Magnolia Health Plans is one of the two companies and CEO Jason Dees says they consider being involved in the exchange an important part of the company’s mission.

"We continue that mission to serve folks that are at or below 250% of the federal poverty level. Which is really our sweet spot. People who are looking for high value in the plans to meet their health needs," Dees said.

Both Magnolia, and the other insurance company Humana, say they choose to operate in counties where they already have an insurance foot print.

But left out of the mix is the biggest insurer in the state Blue Cross Blue Shield of Mississippi.

Charles Pace with Blue Cross says the company is waiting to see if the exchange works.

"Because of the unknowns. Knowing this is going to be a tremendous increase in costs with all the new taxes. And obviously with new benefits come new costs. We are going to wait and look at this again for 2015," Pace said.

All the estimated rates are averages, because the poorer a family or individual is the larger their premium subsidy, also older people will pay more than young people.

The exchange opens for enrollment next Tuesday.

Plans officially kick in at the start of the year.

 

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