ACA enrollees confused by letters estimating higher rate hikes than expected

Nancy Quinn stands in front of the bakery she works at in Philadelphia's Northern Liberties neighborhood. (Joel Wolfram/for WHYY)

Nancy Quinn stands in front of the bakery she works at in Philadelphia's Northern Liberties neighborhood. (Joel Wolfram/for WHYY)

Nancy Quinn got a letter a few days ago that sent her into a panic.

The 55-year-old cancer survivor works at a bakery in Northern Liberties and has subsidized insurance through the Affordable Care Act so it doesn’t eat up too much of her income.

“It’s been a lifesaver for me because I’ve had pre-existing conditions, and I didn’t have insurance before,” Quinn said.

The letter from her health insurance company, Independence Blue Cross, quoted an estimate of  how much she’ll have to pay to keep coverage next year.

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“It’s gonna go up $200 a month starting January, so I’m dropping it,” Quinn said. “Can’t afford it.”

Quinn’s actual cost is probably going to be a lot lower. The price quoted in the letter used the tax credits she received last year to calculate her new monthly premium. But those tax credits are increasing this year to make up for the rising cost of insurance plans in the marketplace.

Premiums for health insurance plans under the Affordable Care Act are increasing this year because of the Trump Administration’s recent move to stop paying out cost-sharing reductions to insurers. The move has stoked some Philadelphians’ fears that they won’t be able to afford insurance in 2018, even though consumers receiving financial assistance are getting higher tax credits to make up for those increases.

But Independence Blue Cross, the only company that offers ACA plans in Philadelphia, didn’t get updated numbers on the financial assistance that people are getting next year in time to include them in the renewal notices members like Quinn received this week. With next year’s premiums increasing an average of 30 percent on the exchange in Pennsylvania, that means some members received estimated premiums that are much higher than what they’ll ultimately pay, assuming they enroll again.

Antoinette Kraus, executive director of the Pennsylvania Health Access Network, said her organization received calls from people worried about the apparent rate hikes.

“We’ve actually had some people post on our Facebook page, you know, panicking because their letter from the insurance company said their rates were going up,” Kraus said.

Independence Blue Cross says federal regulations required insurance companies to send out the notices before the enrollment period began on Wednesday.

“In an ideal scenario, the federal government would give us the updated subsidy information in enough time for us to be able to incorporate [it] into the initial renewal notices,” said Koleen Cavanaugh, the insurer’s vice president of marketing.

“Unfortunately, the process that they follow and the timeline they follow does not allow insurers to do that,” Cavanaugh said.

Independence Blue Cross stated in the renewal letters, “we expect that many Independence members will receive higher subsidies in 2018 that could lower monthly premiums.”

According to Kraus, data from the U.S. Department of Health and Human Services indicates that most people buying ACA plans in Pennsylvania will actually get a better deal for next year.

“Eighty percent of folks shopping in the health insurance marketplace will actually be able to find a plan for $75 or less, and that was compared to 52 percent last year,” Kraus said.

Still, she said, many people have been confused by the news about threats to the health care law.

“It’s important for folks to know the ACA is still the law of the land, they still can enroll, and they still can get tax credits,” Kraus said.

Independence Blue Cross will send an updated letter to its members once it’s able to determine the actual subsidies they will receive.  

Quinn said she’s looking forward to that second letter but all the turmoil over the Affordable Care Act still has her worried she could lose her coverage at any moment.

“With everything going on in the government, you don’t know from day to day what’s going to happen,” she said.

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