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Houston, TX -- A new report detailing affordability and plan choice in the Health Insurance Marketplace finds that with applicable tax credits, 73 percent of Texas enrollees could find plans for $75 in premiums per month or less after tax credits; and 79 percent could find plans for $100 in premiums per month or less after tax credits.
Texas consumers who return to the Marketplace to comparison shop could save money. According to today's report, 93 percent of returning Texas Marketplace consumers could save an average of $637 annually in premiums before tax credits for a plan in the same level of coverage by returning to shop. Nationwide, if all consumers switched from their current plan to the lowest-cost premium plan in the same metal level, the total savings – to consumers and taxpayers (in premiums and tax credits) – would be $4.5 billion.
"Open Enrollment starts Sunday, and new and returning Texas customers will find quality health coverage at prices that fit their budgets," HHS Secretary Sylvia Burwell said. "Nationwide, nearly eight in 10 Marketplace-eligible uninsured consumers can qualify for tax credits to help make premiums more affordable, and in Texas 73 percent of returning enrollees could find plans for $75 or less in premiums per month after tax credits."
Today's report includes information on affordability and choice for consumers living in the 37 states that used the HealthCare.gov platform in 2015 and 2016.
Affordability
In 2015, roughly 85 percent of Marketplace consumers nationwide received tax credits to make their coverage more affordable. In 2016, a 27 year old in Texas with an income of $25,000 a year will on average get a tax credit of $77 a month – compared to $68 in 2015. A typical family of four with an income of $60,000 will on average receive a tax credit of $392 a month – compared to $357 in 2015. Marketplace tax credits are structured so they keep pace with premium increases in the benchmark silver plan (see page 9 of the ASPE analysis for a detailed description of how premium tax credits work).
Across all markets in the 37 states HealthCare.gov states, the cost of the benchmark plan will increase an average of 7.2 percent. In Texas the cost of the benchmark silver level plan will increased by 4 percent. This rate increase does not account for the benefit provided by tax credits to eligible consumers. States that had below-average premiums in 2015 tended to have higher premium increases in 2016.
Choice
According to today's report, in Texas consumers can choose from 17 issuers and an average of 50 plans in 2016. Previous research shows that price competition typically intensifying with three or more competitors in a market.
Across all states using HealthCare.gov, 9 out of 10 returning consumers will be able to choose from 3 or more issuers for 2016 coverage. And on average, consumers can choose from 5 issuers for 2016 coverage, just as they could for 2015 coverage.
In Texas there are 9 fewer plans on average than in 2015 for consumers to choose from. Each issuer reduced its number of plan offerings by 2 on average. This likely reflects issuers' experience in the Marketplace and their understanding of consumer preferences. Nationwide, enrollment in silver level plans is much higher than other metal level plans – 69 percent of enrollees chose a silver plan for 2015 coverage.
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