Amidst the insistence of the GOP that the premium increases on Affordable Care Act (ACA) exchanges have reached “astronomical” heights, one analysis by a socio-economic research institute found that—surprisingly—the average unsubsidized premiums in the Obamacare exchanges are 10% lower than the full premiums in average employer plans nationally in 2016.
The analysis, conducted by the Urban Institute, found that the national average employer-sponsored premium was $516 a month, while unsubsidized marketplace premium was $464. To ensure the accuracy of their comparison, researchers adjusted marketplace premiums to account for enrollee age and the differing values of health coverage offered by ACA plans.
Roughly 11 million people are insured through the federal marketplaces, reported The Washington Post
. In comparison, 155 million Americans receive coverage through employer-provided plans.
Concerns regarding the sustainability of the health exchanges and the affordability of their health plans were raised following the recent string of high-profile carrier withdrawals from the exchanges and the planned rate hikes for next year.
Despite all this, Urban Institute’s analysis discovered that, in more than three-quarters of states and 80% of the large metropolitan areas surveyed for the report, total premiums were lower in an average marketplace plan than in employer-provided plans.
According to the report, the premiums for exchange plans in Pittsburgh were 43% cheaper than employer plans. In Chicago, ACA plans were 41% cheaper than employer plans, while in New York, 26% cheaper.
"It's not that these markets are necessarily outrageously expensive -- in the vast majority of cases they're not," explained Urban Institute Health Policy Center senior fellow Linda Blumberg.
There are a couple of caveats to the analysis. One, most people who receive health insurance via their employers directly pay only a portion of the premium monthly, with the rest covered by their employers as part of workers’ compensation. The other is that the majority of individuals who purchase insurance on the exchanges receive tax credits that lower their premiums.
Not all states exhibited the trend, however. Arkansas (6% more), South Dakota and West Virginia (7% more), Louisiana (8% more), Vermont (15% more), North Carolina (25% more), Wyoming (31% more) and Alaska (68% more) all had exchange premiums higher than average employer plans.
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