Vermont First to Publish Rates Under the Federal Health Law

On Monday, April 1, 2013 the state of Vermont made history by becoming the first state to publish the proposed 2014 individual health insurance rates under the federal health law. Vermont Governor Peter Shumlin had reported that there was no backlash or “rate shock” in the new premiums, despite contrary earlier predictions. 

Be advised, however, that Vermont is unique in that it is only one of seven states in the country which have “community rating regulations,” meaning that it already prohibits insurers from utilizing a patient’s health status to determine what the individual’s premiums will be. The state also requires insurance premium prices to be the same regardless of the insured’s age. These regulations are similar to the health law’s biggest changes: prohibiting insurers from 1) utilizing health status to calculate premiums and 2) charging the elderly population at much higher rates than the younger population. 

That being said, the state of Vermont is probably not the best measuring stick on what the effect of the heath overhaul on premiums will be. 

Some examples of monthly premium costs which have been released by both Blue Cross and Blue Shield of Vermont and MVP Health Care range from $265 for catastrophic coverage for young adults to $609 for “platinum coverage.”  When comparing these ranges to actual rates being offered today, the governor’s office found these rates to be very comparable. 

Starting Oct. 1, 2013, individual and small group insurance coverage, such as the examples mentioned above, will be sold online in the new state “exchanges,” as required by the Affordable Care Act.   

Steven Bisciello is a Health Care Services Group Director experienced in revenue enhancement programs, health care litigation, compliance and physician practice management.

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