By Jerry Geisel, Crain News Service
WASHINGTON (Feb. 26, 2015) — The latest government statistics reveal the hefty new growth in the federal health insurance exchange, upping the stakes of an upcoming Supreme Court decision on the legality of premium subsidies to those obtaining healthcare coverage through the exchange.
A Department of Health and Human Services (HHS) report released Feb. 18 found that as of Feb. 15 — the close of the official 2015 open enrollment period — 8.6 million people had selected plans in the federal exchange, which offers coverage to eligible individuals living in the 37 states that declined to set up the Patient Protection and Affordable Care Act (ACA) authorized exchanges.
By contrast, 5.4 million people had selected plans in the federal exchange at the close of last year's open enrollment period.
Perhaps not surprisingly, large states with high uninsured rates, showed big increases in the number of people opting for coverage during the most recent open season in the federal exchange.
For example, in Florida, which in 2013 had 20 percent of the population uninsured — the third highest of any state, according to the U.S. Census Bureau — 1.6 million people selected plans or were automatically re-enrolled in the current open season, according to the HHS report. By contrast, at the close of the 2013 open season, just 984,000 Floridians had opted for coverage
That made Florida the state with the largest number of signups in the federal exchange during the latest enrollment period.
Texas, which in 2013 had the highest uninsured rate — 22.1 percent — of any state, had the second highest number of people who selected plans or were re-enrolled in the federal exchange during the current open season: nearly 1.2 million, up from about 734,000 from the end of the 2013 open season.
In both Florida and Texas, most people selecting coverage in the federal exchange were eligible for federal premium subsidies. For example, through the end of January, 93 percent of Florida residents opting for coverage in the federal exchange used federal subsidies, while 86 percent of Texans did so, according to HHS.
Those subsidies — available to those with incomes between 100 percent and 400 percent of the federal poverty level — slashed the cost of coverage.
Florida enrollees selected plans with an average monthly premium of $384. On average, enrollees received a monthly subsidy of $297 which brought down the premium they paid for coverage to $88 a month.
Texas enrollees selected plans with an average monthly premium of $337. On average, enrollees received a premium subsidy of $242, which cut the premium they paid for coverage to $95 a month.
Those premium subsidies, though, are at stake in a suit before the U.S. Supreme Court.
Plaintiffs argue that the ACA only permits premium subsidies in states that have set up their own exchanges. So far, just 13 states, plus the District of Columbia, have established exchanges.
The high court will hear oral arguments on March 4.
This report appeared on the website of Crain's Business Insurance magazine, a Chicago-based sister publication of Tire Business.