Next year, premiums for individual health insurance plans in Montana will go down for the first time since the Affordable Care Act took effect. Open enrollment starts Friday.
The roughly 50,000 Montanans who receive health coverage in the Affordable Care Act marketplace could see their premium bills drop by hundreds or thousands of dollars next year.
John Doran is a vice president for Blue Cross Blue Shield of Montana.
“For the first time since the inception of the ACA back in 2014, all three insurance companies offering plans to Montanans are seeing a drop in premiums over the previous year,” he says.
Blue Cross Blue Shield, PacificSource and the Montana Health Co-op are the three providers of health insurance on the individual market in the state.
At the direction of a state law passed earlier this year, the companies are pooling their money together to help cover high ticket claims for health care. The federal government is also adding money to the pool and paying for a majority of the costs.
The result is that insurers don’t have to gamble on paying large and unpredictable health care bills because the new policy builds what amounts to insurance for insurance companies. And this lowers premium costs.
Doran says there are other factors contributing to the decline in premium costs in 2020, like insurance companies seeing more stability within the Affordable Care Act, but he says the recent pooling of insurance companies and federal dollars is a big part of it.
Richard Miltenberger is the president of the Montana Health Co-Op, the largest provider on the individual market in the state.
“The average person’s rates are gonna go down 5 to 7 percent,” he says.
That’s just the average for the co-op. What Montanans on the individual market actually see on their premium bill could be much higher or lower than that.
While costs are going down next year, Miltenberger says the recent changes to how insurance companies approach expensive health claims isn’t a permanent fix to rising health care costs across the country.
“In a way we’ve had a slow motion train wreck for the last 20 years in health care costs. It’s slowing down a little bit more this year, but we need some significant cost relief in health care,” he says.
The premium cost reductions expected in 2020 don’t apply to people receiving health coverage from their employer.
The price of individual market plans depend on a person's age, location and income.
Matt Rosendale, the state auditor and commissioner of securities and insurance, says every insurance plan sold in Montana’s individual marketplace will cost less in the coming year.
“Across the board we’re looking at saving $51 million to the ratepayers here in Montana for the 2020 year,” he says.
Open enrollment on healthcare.gov runs from November 1 through December 15.