According to the US Department of Health & Human Services (HHS), 87 per cent, the health plans qualified bought by Healthcare.gov in 2014 for premium tax credits, the tax credit covering 76 percent of the premium cost. For those who do, these numbers are significant to the Affordable Care Act and the shift in the health insurance market.
tax credits cover 76% of premiums for HealthCare.gov plans
data after release by HHS in June t he average premium before tax credits is $ 346 / month.
But for the 87 percent premium receives tax credits, the average out-of-pocket premium costs for all types of plans is $ 82 . are premium tax credits 76 percent of the premium covering costs on average.
For Silver plans, the most popular type of plan, 94% receive tax credits and pay an average of 69 $ / month. In addition, for these receive premium tax credits, are 46% $ 50 / month or pay less, 69% pay $ 100 / month or pay less and 82% $ 150 / month or less.
The cost statistics cover the 5.4 million people who have signed for private plans through the federal exchange, Healthcare.gov. Additional 2.6 million people enrolled by exchanging 14 states and the District of Columbia run in the plans.
Why These statistics are significant
The figures are significant because they support the prediction, the health insurance market is a massive transition from traditional employer-sponsored health insurance individual health insurance.
, for example, learns S & P Capital IQ ( a division of McGraw-Hill) forecast recently that b y 2020, 0% of American employees who could receive health insurance through their employers currently to individual health insurance and state exchange to be postponed.
Similarly Dr. Ezekiel J. Emanuel, in his recent book "Reinventing American Health Care", predicts that b y 2025 less than 20 percent of employees in the private sector is traditionally receive employer-sponsored health insurance.
one of the biggest reasons for the shift is cost benefits to the individual market.
According to the Kaiser Family Foundation to cover the average cost of a single employee with traditional employer-sponsored health insurance in 2013 was $ 40 / month ( source ). compared to individual health insurance averages available by Healthcare.gov, employer-sponsored health insurance costs by 26% more for non-subsidized coverage, and 83% more for subsidized coverage. As an employer health insurance to evaluate options for employees, and see them costs compare clear financial advantages of individual health insurance.
New benefits for individual health insurance, defined contribution
But it is not only costs. There are also new benefits introduced by the Affordable Care Act for individual health insurance.
Before the Affordable Care Act, individual health insurance plans and employer-sponsored health insurance plans were different. Individual health insurance plans could refuse to supply or provide more for coverage based on health conditions into account. One reason why employers offered employer-sponsored health insurance (despite the higher price) was because they do not find yourself worrying about sick employees able coverage with an individual health plan. funded with employer health insurance, everyone is covered -. No questions asked
But with the ACA now in full effect, the game field is leveled. Individual health insurance plans are guaranteed issue, so that all employees can find coverage regardless of health. In fact, many of the new ACA provisions strongly prefer individual health insurance. Individual health insurance is now just as good (and better in most cases) funded as a traditional employer health insurance.
As an employer transition staff and individual health insurance exchanges, they do not leave an employee health benefits altogether. Rather, they are to change their contribution strategy.
Rather than contributing to employer-sponsored health insurance premiums (a "defined benefit"), bear the employers health care benefits (a "defined contribution") paid to employees for individual health insurance. Read more contribution on
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