Health insurance rates are set to rise, warns Florida commissioner
Health insurance rates could see a dramatic rise in Florida, according to Insurance Commissioner Kevin McCarty. The commissioner claims that health insurance rates for small businesses and individuals will rise as a result of the Affordable Care Act. Rising rates are being linked to the formation of an insurance exchange within the state. Florida will not operate its own health insurance exchange, the presence of the exchange and the provisions of the Affordable Care Act could make coverage significantly more expensive in the near future.
Federal law puts more pressure on insurers
According to the Affordable Care Act, all health insurance plans sold in the individual market must meet certain standards. These plans must provide coverage for pre-existing conditions, reduce the financial exposure that consumers face, and meet federally-established coverage standards. Older consumers will play less for their coverage than younger consumers and all U.S. citizens are required to have active health insurance coverage beginning in January 2014. These provisions are contributing to the rise in health insurance costs, according to Insurance Commissioner McCarty.
Rates for individuals could grow by 40%
McCarty suggests that rates for the small group market will rise by as much as 20%, with the individual market seeing rates rise by as much as 40%. Insurance companies are looking to mitigate their financial losses when it comes to the Affordable Care Act, and being required to provide coverage for those considered to be a medical risk is expected to be a costly endeavor for more insurance providers. Adding additional benefits to insurance plans in order to comply with federal standards is also forcing insurers to raise rates on the coverage they offer.
State exchange to begin open enrollment this year
The Florida health insurance exchange will begin open enrollment on October 1 of this year. Plans sold through the exchange will go active on January 1, 2014, along with many of the provisions of the Affordable Care Act. The plans being offered through the exchange come from many of Florida’s largest providers, including Cigna and Florida Blue.