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Red State or Blue, Obamacare Pricing Seems Apolitical

Illinois residents sign up for health care through the affordable care act
David Mercer/APPatrick Lamanske of Champaign, Ill., works with Amanda Ziemnisky, right, of the Champaign Urbana Public Health District office in Champaign to try to sign his wife, Ping Lamanske, left, up for health care coverage through the Affordable Care Act.
By Caroline Humer

NEW YORK -- For Americans who are able to check out new insurance plans launched under President Barack Obama's health care reform, the price differences from state to state may be surprising.

Residents of Minnesota, a Democratic-led state, are likely to pay the lowest monthly premiums in the country. Just two states away, some residents of Republican-dominated Wyoming might be surprised to find they will pay among the highest.

But the ideological debate between Obamacare's supporters and opponents seems to have had little relevance when it comes to the affordability of care, the main goal of the Democratic president's signature program, health economists and actuaries say.

Instead, they point to regional differences in medical costs, the relative health and age of local populations and competition among insurers as having greater influence over the monthly premiums. Those differences lead to a wide variance in prices between states, and even within states.

Of the 24 states that fall below a national average of $328 in monthly premiums, laid out in a U.S. Department of Health and Human Services analysis last month, at least half are dominated by Republican state governments.

The affordability of the plans will likely determine whether enough uninsured Americans, particularly young and healthy ones, sign up to make the program successful.

The new insurance plans became available for enrollment nationwide on Oct. 1. But technical problems with the federal government's health care.gov website serving 36 states have blocked millions of people from accessing the information.

In Wyoming, the cheapest mid-tier plan, or "silver" plan, costs $307 for a 27-year old in Laramie County, one of the state's only two counties considered "urban" and where the state capital Cheyenne is located.
It has 60,000 residents with an average age of 37 years old. Venture outside those two counties and prices rise by $25. Change to the one other insurer offering a plan, and prices climb $100.

In Minnesota, a 27-year old in Minneapolis could pay $126 for a silver plan. Its population is 393,000, and the median age is 34. Go out to Traverse County, with the oldest population in the state, and that starting price rises to $153. In Minnesota, residents can choose from four insurers.

"It seems that basically the eligible populations in those areas, and the relative negotiating power of providers and insurance plans seem to really be the driver" of prices, said Matthew Buettgens, a mathematician at the Urban Institute, a social and economic research, "not necessarily politics."

Maryland, a staunchly Democratic state with an active insurance department, emphasized its ability to reduce premium rates by about 30 percent overall on the new products. But the average price on its mid-tier "silver" insurance plan is $299, only $6 less than in Republican-led Texas, whose leaders have been at the forefront of an effort to kill the health care law, culminating in a federal government shutdown.

Even within a state, there are variations. In Georgia, a 100-mile difference can mean hundreds of dollars in the monthly cost. Monthly premiums in rural regions cost much more than in more populated areas.

According to the data on the federal health care.gov website, the cheapest "silver" plans in the state are in the counties surrounding Atlanta -- about $185 a month -- where five insurers sell plans. The most expensive are in Georgia's southwest corner, where only Anthem Blue Cross Blue Shield, a unit of WellPoint (WLP), sells Obamacare plans at a minimum of $200 a month higher for a comparable plan.

Florida and Texas Rates

To be sure, politics historically has played a role in how states regulate insurance. Many of the Republican "red" states have had a laissez-faire attitude towards regulation compared with activist Democratic, or "blue," states.

And to a lesser degree, that regulation did affect Obamacare prices. Many Republican states have deferred to the federal government to run their exchanges, while Democratic states that support Obamacare have taken an active role in running their own exchanges.

Click on image to enlarge

Leaders in Texas and Florida also blamed Obamacare for skyrocketing health insurance costs, arguing that the new plans will take a toll on individuals and businesses.

In Florida, the Republican-led legislature and governor suspended the state insurance department's rate review authority for 2014 and 2015, saying they didn't want the state to participate in the overhaul.

But even without official authority, Florida still conducted "informational" reviews of rates for 2014 insurance products, and the federal government examined premiums there.

A Reuters review of insurance filings in both states showed their insurance departments played an active role in examining the plans proposed by insurance companies before they were submitted to the federal government. In at least one instance in Texas, the review led an insurer to lower prices for their plan, the insurer said.

In Florida, the average monthly premium matches the national average at $328. In Texas, it is lower at $305. A check of the benchmark mid-tier, or "silver," plans shows Texas is among the least expensive, costing $108 to insure a 27-year-old.

Florida's silver plans start more than $100 below the national average price, with prices at around $200 for a 27-year-old available in much of the state. The figures are before government subsidies for people earning less than 400 percent of the federal poverty level, or $94,200 for a family of four.

Standardizing Benefits

Obamacare requires all insurance policies for individuals to cover 10 standard health benefits, including maternity and emergency services, making the estimated cost of covering an individual the single biggest factor in premium rate. Regional differences play a role in making those estimates, experts explain.

"Colorado is purportedly a very healthy state and knowing people who live there, I understand why. They are always out there climbing mountains," said Jim O'Connor, a principal at actuary firm Milliman in Chicago.

Spending also varies by the price of medical services rendered in each region -- the cost of an X-ray in Topeka versus Miami, for example. A third factor is how often someone living in the region typically goes to the doctor when they are sick, which can be heavily influenced by social norms.

Other wild cards involved in setting premiums include how many of the very sick people in their state will buy a particular insurer's plan, and how many of the previously uninsured population will come in with pent-up demand for doctor visits and new treatments -- one of the true tests of Obamacare.


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63 Comments

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bcrnbs2

where does the affordable come in from.. can you afford 126 dollars a mounth to over 200 for a plan, and if you can, when do we find out what these plans cover... ...

October 13 2013 at 8:42 AM Report abuse -1 rate up rate down Reply
2 replies to bcrnbs2's comment
Dalface

Are you saying that $126/month is a lot of money? I'm just asking since everyone has a different idea of what a lot of money is. Personally I would be jumping for joy if all I paid was $126/month.

October 25 2013 at 1:01 PM Report abuse rate up rate down Reply
Dalface

If you do a search online for the specific plan, you can see what it covers. In TX, we have Aetna, Blue Cross and Cigna, I'm not sure if it's the same everywhere, I think it's not. Anyway, I found the name of a plan, searched for it by name and found ALL the plans by lets say Aetna in ObamaCare. Now I don't know if it's final, or real, but they are supposedly the prices pre-subsidy based on income. I'm hopeful that these are the prices, but I'm keeping an open mind that things will change. I won't believe all that I hear until I can see "my" prices and sign up for a plan. Then I think I'll know for sure.

October 25 2013 at 1:02 PM Report abuse rate up rate down Reply
dembamyshuterdown

ABOLISH THIS MUSLIM CLOWNS UNCONSTITUTIONAL WELFARE "HELL" CARE N DEPORT ALL ILLEGAL IMMIGRANTS OBAMIT LET "BREAK" INTO AMERICA. ! ~~> DAY 13 OF THE OBAMIT N DUMMYCRAPS GOVERNMENT SHUT DOWN N NEXT WEEK OBAMIT WILL SHUT DOWN THE WHOLE COUNTRY. !!!!

October 13 2013 at 7:56 AM Report abuse rate up rate down Reply
raddison4x

Florida is Republican? Then how did Obama win Florida???? Very odd.

October 13 2013 at 7:20 AM Report abuse -1 rate up rate down Reply
1 reply to raddison4x's comment
dembamyshuterdown

ITS CALLED ILLEGAL IMMIGRANTS THAT OBAMIT LET "BREAK" INTO AMERICA GETTING A FREE HANDOUT ON ALL AMERICAN TAX PAYERS DIME. !!!! . !!!

October 13 2013 at 7:58 AM Report abuse rate up rate down Reply
toosmart4u

The only problem with this country right now is the republicans. Time to send them home. The republicans tried this war on Obamacare like they did for social security and medicare.

October 13 2013 at 3:16 AM Report abuse -1 rate up rate down Reply
1 reply to toosmart4u's comment
nos2001

this administration has been a disaster. we have no leadership, experience, or common economic sense. you won't be happy till our children have no future at all. a backgound of community organizer doesnt cut it..our foreign policy is in disaray, our national debt increase is more than the debt all before him, unemp;oyment, scandals-it just goes on and on. as a nation we can't keep doing what is being done to our country. those that voted for this man, what were you thinking? our country has NEVER had so much of a mess as we have now.

October 13 2013 at 7:36 AM Report abuse +2 rate up rate down Reply
1 reply to nos2001's comment
dembamyshuterdown

DAY 13 OF THE OBAMIT N DUMMYCRAP GOVERNMENT SHUT DOWN DISASTER N THE REAL DISASTER WILL BE NEXT WEEK WHEN OBAMIT SHUTS DOWN THE WHOLE NATION ~~>JAN~20~09~~>"THE DISGRACING OF AMERICA""~~STAND YOU GROUND" PRESIDENT BOEHNER ,ALL OF AMERICA IS WITH YOU. !

October 13 2013 at 7:47 AM Report abuse -1 rate up rate down
doywoods8

People need to see the documentary \"Obama\'s America 2016\". Can\'t find it? Try Local library. It\'s not left or right and explains what He and His Father\'s ideas are, plus the outlook for America in 2016 and beyond. It is before his re-election. And you will see what how this man will Destroy the United States with uniform standards that he has put forward, such as AHCA and keeping the U.S. in turmoil and at each others throats. The Docu. will teach you things that The King B.H.O. Jr.. has hidden from us. By the way, maternaty ins. for ALL AGES (0-100 yrs old) mandatory is REdick-u-lus. Premiums go up with a deduct of $6,000-10,000 is not AFFORDABLE by NO MEANS. ILLEAGAL ALIENS is exempt, of course, because of no papers and they pay no ss or with-holding taxes, but they draw expenses from our Healthcare system as well as USDA (SNAP, formally known as \"food stamps\") from their chidren that was born here but concieved across the border, then have 6 kids so they trade them off as dependants on IRS (just stating the facts,not my opinion, they brag about it between themselves).. To you people that say we are Immigrants too, My ancestors REQUIREMENT to immigrate here was to learn and speak ENGLISH. I could go on but thats enuf said.

October 13 2013 at 2:52 AM Report abuse +1 rate up rate down Reply
HiBarbRayAndMeg

It will take a few months to window shop and understand that subsidies will reduce your monthly payment. This article was poorly written and could of done a much better job explaining how the subsidies work.. Most young people who make less than 30k will be paying about 50 bucks a month due to subsidies.

October 13 2013 at 2:15 AM Report abuse rate up rate down Reply
1 reply to HiBarbRayAndMeg's comment
nos2001

in your dreams... where oh where did you come up with such a nutty figure like that. did our fearless leader tell you that. like he always tells the truth. give me a break. nuts, just plain nuts.

October 13 2013 at 7:43 AM Report abuse rate up rate down Reply
ttruckr23

So I get a letter this week from Blue Cross saying due to them not being required to insure me anymore, as of 1/1/14 I will be dropped by them. I can reapply to them but seeing as they turned me down in '05, what are the odds that a 64 year old with diabetes and had a heart attack could even afford what they'd charge.... even if they said yes to me?

Madame Pelosi, Harry Reid and in particular Barry Obama, you lying SOBS can suck eggs..... big fat rotten, salmonella infested eggs. And your supporters of ObamaCare are also included in that wish too. Good job at insuring the slackers while at the same time royally screwing those that have taken personal responsibility all their lives, haven't lived off the dole, paid their taxes and apparently supported the rest of the slugs and now, due to BHO, will be put into the position of being uninsured themselves............ with the "taxes" and expense s involved.

October 13 2013 at 1:31 AM Report abuse +3 rate up rate down Reply
1 reply to ttruckr23's comment
HiBarbRayAndMeg

You are confused.. Check out all your options and you will be surprised how much lower your costs will be.. And no one can deny you or charge you more for pre-existing conditions, that is the beauty of ObamaCare.

October 13 2013 at 2:16 AM Report abuse -1 rate up rate down Reply
2 replies to HiBarbRayAndMeg's comment
aspman07

You are full of it.

October 13 2013 at 3:58 AM Report abuse +1 rate up rate down
nos2001

ya, sure

October 13 2013 at 7:51 AM Report abuse -1 rate up rate down
zapdog4

The costs are apolitical, because it does not matter what party to which you belong... we are all being forced to purchase a service against our own free will, solely to benefit others and not ourselves, and at an exorbitant price. A Health Care Plan that isnt even good enough for the Man and the Family it is named for.

October 13 2013 at 12:30 AM Report abuse +3 rate up rate down Reply
zbt3

premiums - bs; the impotant issues go w/o mention by media - deductibles and out-of-pocket maximums. This is UNaffordable care.

October 13 2013 at 12:05 AM Report abuse +4 rate up rate down Reply
1 reply to zbt3's comment
musikhut

You said it! I can only afford a bronze plan.... no co-pays, no prescrips, and a $10K deductible. Yeah, that\'s going to take all my health care worries away.

October 13 2013 at 4:09 AM Report abuse +2 rate up rate down Reply
1 reply to musikhut's comment
Dalface

Understand that the lower the plan level, the higher your deductibles and copays. So if you go to a higher plan, your copay and deductible goes down. If you don't go to the doctor a lot, get bronze, otherwise get a higher level. I saw a plan in Gold for $348/month for 2 people (In Texas). Would you consider that a lot?

October 25 2013 at 1:10 PM Report abuse rate up rate down
lklex

But, the greatest disparities under Obamacare are based on gender, not geography. The Affordable Care Act, specially targets women for MORE FAVORABLE treatment and, in doing so, flagrantly discriminates against male Americans and egregiously violates the principle of equal protection of the laws enshrined in the Fourteenth Amendment to the U.S. Constitution and made applicable to federal law via the Fifth Amendment. In denying men COST-SHARE FREE healthcare benefits (including a cost-share free annual "well-man" medical exam, like the annual cost-share free "well-woman" medical exam, certain cost-share free non-gender specific health screenings and cost-share free domestic violence counseling) on the same basis they are made available to female Americans, Obamacare callously relegates male Americans to the status of second-class citizens and second-class human beings. Never mind that male Americans are more likely than female Americans to die young from America's top killer diseases, including cancer and heart disease, and already suffer from a five-year shorter life expectancy. Never mind that conferring such benefits based on gender (an immutable attribute of birth) is disturbingly reminiscent of the Nuremberg Laws of 1935 and offends any notion of equality of rights under the law.

October 12 2013 at 10:38 PM Report abuse +2 rate up rate down Reply