Most of us say "thanks" without thinking.
June 18--New Jerseyans who bought health insurance through the Affordable Care Act federal exchange paid some of the highest prices nationwide, according to a federal government report released Wednesday, the result of the state's high cost of living and its relatively few insurance providers.
Consumers in the Garden State had average premiums of $465 a month if they did not qualify for tax credits -- tops in the nation among the 36 states using the federal exchange -- and $148 a month if they qualified for tax credits, second only to Alaska. By comparison, consumers nationwide had average premiums of $346 a month before tax credits an $82 a month after tax credits, the report by the U.S. Department of Health and Human Services found.
"It's the underlying cost of care," said Wardell Sanders, president of the New Jersey Association of Health Plans, a trade group that represents insurers.
The report was the first look at premiums for consumers who bought policies on the federal exchange, the online marketplace established by the Affordable Care Act, commonly known as Obamacare. And it comes a little more than two months after the law's first open enrollment ended.
New Jersey was one of 36 states nationwide that used the federal exchange rather than create their own, designed to help the law meet its dual mandate -- to insure consumers who didn't have policies through Medicare, Medicaid or their employers, and to slow down the rising cost of health care.
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Obamacare supporters in the state were encouraged by enrollment. More than 160,000 New Jerseyans signed up for private insurance, surpassing expectations.
What's affordable, however, has been a major point of contention. The government offered tax credits to consumers who bought policies on the exchange and made less than four times the poverty level -- about $46,000 for an individual and $94,000 for a family of four. But the report shows that in New Jersey, health insurance, even with tax breaks, still could be pricey.
Patti Cetta, 32, of Toms River, helped a handful of family members sign up and found premiums to be a stretch. Her mother-in-law, for example, works two low-wage jobs -- one as a health aide, another at a convenience store -- and still got quotes from insurance plans on the exchange for more than $200 a month. In addition, the plans had high deductibles.
It was too much to afford, Cetta said, so she is trying to enroll her mother-in-law in Medicaid.
The Affordable Care Act requires insurers to play by the same rules nationwide. They need to spend at least 80 percent of premiums on health care. And they need to cover at least 10 benefits designed to prevent more serious illnesses.
So why did New Jersey consumers pay 34 percent more for premiums before tax credits?
--New Jersey hospitals charge some of the highest rates nationwide -- a measure at least partly determined by the state's high labor and property costs, Sanders said. Most notably, Bayonne Medical Center recently was found to have the highest charges in the nation.
--New Jersey has less competition. Just three insurance companies -- AmeriHealth New Jersey, Horizon Blue Cross Blue Shield of New Jersey and Health Republic Insurance of New Jersey -- offer plans on the exchange. Other states using the exchange have on average of five plans. And neighboring New York has 16 insurers on its state-operated exchange.
Before the Affordable Care Act, New Jersey and New York had similar premiums, in part because both states required insurers to guarantee coverage regardless of whether consumers previously had health problems, said Linda Schwimmer, vice president of New Jersey Health Care Quality Institute.
Now, the average cost for a silver plan in both states remains virtually the same. But New York has more options; its plans range from $319.47 a month to $635.60 a month -- before tax credits.
"Less competition does seem to make a difference," Schwimmer said. "They have a lot more choices and a lot more competition."
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