PROVIDENCE, R.I. (WPRI) - Rhode Island officials gave a first look Tuesday at how much it will cost to buy insurance plans through the new marketplace the state is setting up under President Obama's health law, suggesting rates won't rise significantly from current levels.
While most Rhode Islanders will continue to be insured through their employers under the law, starting on Oct. 1 two groups - individuals who don't get coverage at work, and small businesses who employ up to 50 people - will be able to purchase plans through HealthSource RI, the state's online Obamacare marketplace.
HealthSource RI Executive Director Christine Ferguson estimated 360,000 Rhode Islanders will be eligible to use the exchange this fall, though not all of them will. "One of our focuses is going to be to maintain employer-based coverage, because for a lot of people it's a really good arrangement, and employers want their people to be healthy," she told reporters at a briefing.
Rhode Islanders who earn less than 400% of the federal poverty level - about $46,000 for an individual or $94,000 for a family of four - will be offered significant federal tax credits to offset the cost of their health premiums if they buy through HealthSource RI. Tax credits will also be available to some small businesses who insure their workers.
- For individuals: Details on the 12 health plans | Premiums by age [pdf]
- For small businesses: Details on the 16 health plans | Premiums by age [pdf]
- Nesi's Notes: Full coverage of Obamacare in Rhode Island
HealthSource RI will sell 28 insurance plans in its first year, 12 for individuals and 16 for employees of small businesses, Ferguson said. The plans will be sold by Blue Cross & Blue Shield of Rhode Island, Neighborhood Health Plan of Rhode Island and UnitedHealthcare. Tufts Health Plan will join them in 2015, and Ferguson said Connecticut's nonprofit CO-OP may do so, as well.
However, the two health plans Neighborhood is selling for individuals will only be available to Rhode Islanders who make up to 250% of the federal poverty level, meaning only Blue Cross insurance will be available to all individuals in 2014.
"The idea here is that we have a larger state interest in Neighborhood Health Plan Rhode Island, and we need to make sure they're solvent and we don't want to disrupt everything, and we want to be cautious as we move forward," Ferguson said. Neighborhood plays a key role in Rhode Island's Medicaid program.
It's difficult to summarize what HealthSource RI premiums will cost the average person because the health law makes a number of changes to how insurance works. Women can no longer be charged higher rates than men, unhealthy people can no longer be refused coverage due to pre-existing conditions, and many services - including preventive and emergency care - are required under all plans.
For a 30-year-old Rhode Islander buying one of the 12 individual insurance plans, premiums will cost $189 to $320 a month before the tax credits; for a 55-year-old, monthly premiums will cost $371 to $629 before the credits. The plans have annual deductibles ranging from $500 to $5,800, and cap individuals' out-of-pocket medical costs at $2,250 to $6,350 a year.
The average monthly premium for individual health insurance in Rhode Island was $398 in 2009, the most recent year for which data is available from the trade group America's Health Insurance Plans. Federal data in January showed base premiums for 30-year-old single Rhode Islanders were $121 to $247 for men and $181 to $369 for women.
The 16 health plans for small businesses will work differently.
Employers who decide to insure their workers through HealthSource RI can either pick one health plan for all their employees, or let the employees choose between any of the 16 plans. Either way, employers will pay their share of the workers' insurance premiums through HealthSource RI.
Among the 16 small business plans, premiums for a 30-year-old will cost $212 to $429 and for a 55-year-old will cost $417 to $842. "For the first time in Rhode Island, small businesses are going to be able to get something that large businesses can't get - and that's not usually how it works in Rhode Island," Ferguson said.
A breakdown of the HealthSource RI plans' costs for families wasn't available yet on Tuesday.
Ferguson emphasized that looking at premiums only shows one piece of the cost of a health plan, and said that to understand which insurance policy is the best fit Rhode Islanders should also look at their deductibles, co-payments, co-inusrance, out-of-pocket maximums and networks of hospitals and doctors.
"The premium is only one piece, and if we're only focusing on the premium we are doing people a disservice," she said. "It's complicated, but I don't think it's so complicated that people can't understand it."
HealthSource RI is developing a calculator for its website that will allow individuals to compare the bottom-line costs of different health plans with the tax credits applied, spokesman Ian Lang said. It will be available in the coming weeks. The agency will spend more than $5 million on publicity in the coming months.
Michelle Coppolino, an insurance broker with Gallo | Thomas Insurance in Warwick, said the additional information will make it easier to explain the pros and cons of HealthSource RI to her clients, who are already asking a lot of questions as the Oct. 1 enrollment date draws closer.
"The brokers that are on top of it are beginning to embrace it," she said. "The change is happening, so you have to embrace the change."
Coppolino said she expects some small businesses will like the idea of setting the amount they'll contribute toward their workers' health plans and then letting their employees choose among a variety of options through HealthSource RI.
Ferguson said any Rhode Island resident will be able to call HealthSource RI's new contact center to get answers to questions about their insurance plans and their medical options.
"The idea of HealthSource is for all Rhode Islanders, not just people buying through the exchange," she said. "We're really shining a light on how insurance works and how we can change it collectively, as well as individually through our choices."
Rhode Island is one of 16 states that decided to set up its own Obamacare health exchange, rather than have the federal government handle the job. Many Republican governors declined to set up marketplaces for their states due to their opposition to the health law.
"We are so fortunate in this state to really have everyone thinking about how to make this work well, as opposed to whether to make it work at all," Ferguson said.
HealthSource RI remains on track to begin insurance enrollment online on time on Oct. 1, unlike at least one other state, Ferguson said. But she added that she will delay the start of sign-up if necessary.
"If that became something that we had to do because we had to get something right I wouldn't hesitate to do it, because that would be a smart and more effective thing to do for the state," she said. "But right now we're not in that situation."
Ferguson lavished praise on the three insurers taking part in HealthSource RI's launch - Blue Cross, Neighborhood and United - for working more cooperatively than some of their counterparts elsewhere have. "The carriers in this case state have been incredible," she said. Rhode Island is one of only five states where United is joining the Obamacare marketplace, she noted.
Ferguson expressed optimism that HealthSource RI will be more than an Amazon.com for Rhode Island health insurance, saying it could lay the foundation for a more integrated medical system that saves money and keeps people healthier.
"If employers really start to see the value of this, I think you'll see much faster change in [Rhode Island's health care] system, and that's going to bode well ... for providers and consumers, because there's some really cool things happening in the delivery system that aren't being reflected in the insurance piece," she said.
"We have a lot of work to do over the next couple of years," Ferguson added.
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