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Tax Credits Expected To Cushion Obamacare Premium Increases For Many website website

Health insurance companies selling individual policies in Montana say they have to raise their prices next year. But the federal government says it won’t be as bad as the headlines suggest. The Obama administration says most Americans don’t have to worry about possible spikes in premium rates next year.

“Our analysis shows that at a national level, even in a hypothetical scenario in which all marketplace premiums rise by 25 percent next year, the vast majority – 73 percent of consumers – could still find coverage for less than $75 dollars per month.”

That’s Katie Martin from the U.S. Department of Health and Human Services. Martin says two built-in Obamacare features will help keep those insurance rates in check.

The first is premium tax credits:

"If all premiums in a market go up by similar amounts, the large majority of consumers in that market will not have to pay significantly more since tax credits will increase accordingly. The second piece is shopping. We know that shopping during open enrollment plays a very important role in keeping premiums affordable for consumers."

But an estimated 35,000 Montanans who don’t qualify for federal subsidies will almost certainly face higher rates next year. The feds encourage them to take a second look and shop for good deals.

Three insurers sell individual policies in Montana. They’ve submitted requests for premium increases ranging from 20 to 62 percent next year. They say they’re paying out more for health care than they’re collecting in premiums.

State Insurance Commissioner Monica Lindeen is reviewing those rate increase requests. Her office can require insurers to justify their rates, but does not have the power to deny them.

Open enrollment for 2017 starts in November.

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