Sharp rate hike looms: Fewer options available for self-employed

Hoosiers buying health insurance on the Obamacare marketplace will pay an average of nearly $500 a month in premiums next year, a sharp rise over current rates.

Hoosiers buying health insurance on the Obamacare marketplace will pay an average of nearly $500 a month in premiums next year, a sharp rise over current rates.

The State of Indiana posted information online showing the average premiums from the only two insurers left on the exchange.

  • CareSource Indiana will charge an average premium of $497.59 a month, representing an increase of 20 percent.
  • Celtic Insurance Co./MHS will charge slightly less, an average premium of $496 a month, representing an increase of 35.7 percent.

People without employer-sponsored health care or other coverage can sign upon on during the open-enrollment period, which runs from Nov. 1 to Dec. 15. Coverage starts Jan. 1.

Numerous studies have shown that the Obamacare exchanges have signed up fewer young, healthy people than expected, meaning that they are disproportionately filled with older, sicker people with more expensive health needs. That has caused many insurers to increase rates sharply to cover high medical costs, or to flee the exchanges altogether.

In Indiana, two major insurers, Anthem Inc. and MDwise Marketplace, said in June they would drop out of the exchanges next year, citing growing uncertainty over the future of the Affordable Care Act.

Columbus Realtor and pastor Kevin Metz, who is self-employed, has purchased a plan on the marketplace since its inception and is one of the customers losing MDwise Marketplace coverage with the company’s exit.

“I never did like the idea of Obamacare,” Metz said of being forced to give up buying his own plan privately through an insurance company and instead shopping for one on the Marketplace.

Metz said the health insurance he bought on his own before the marketplace existed was chosen as more of a policy to handle catastrophic events, insurance that cost about $180 a month with a $2,500 deductible.

“If something would happen, I would be responsible and take care of it,” he said.

When he received the notification from his insurance company that the company would no longer offer the policy he had been buying because of the Affordable Care Act, Metz said he was responsible once again and went on the Marketplace to find a comparable plan. But he soon learned that the policies being offered were more expensive, offering far more coverage — including maternity and other services he didn’t need — with a higher deductible.

The first year of Obamacare and the marketplace, his premium went to $250 a month with a $3,500 deducible, with the federal government offering an additional $250 a month subsidy for the policy, he said. With his contribution and the federal government’s, the insurance was a $500-a-month premium, he said.

The second year of the marketplace, it went up to $280 a month, with the government paying another $280 a month in subsidy and the deductible going up to $5,000, he said. Metz paid $280 and the federal government matched and paid $280 for the policy for a premium total of $560.

The higher the deductible makes it less likely that the insurance policy will ever be used, Metz said.

By the third year of the marketplace, the premium had gone up to $350 a month, with the additional $350 in federal subsidy, and a $7,500 deductible, he said. The total premium, split between Metz and the federal subsidy, was $700 a month.

Metz said this was from MDWise, the most affordable among the options, although some companies were charging $200 and $300 a month more for the same identical coverage.

“You have to shop it hard,” he said of the choices on the marketplace and the monthly premium costs being charged by insurance companies.

“I used to be able to get this same coverage for 180 bucks. Obamacare helps people who make no money at all. But for anybody who is self-employed and trying to pay their own bills, Obamacare is ridiculous,” he said.

Metz predicts he will probably have to pay substantially more, with an even higher deductible, with MDWise pulling out of the market for next year’s coverage.

The federal government’s penalty for having no insurance is $695, something Metz said looks more attractive as the premiums and deductibles continue to rise.

“The penalty is nothing — $695 — it’s ridiculous that there is even still a penalty there,” he said.

In Bartholomew County, 1,525 people signed up for the Affordable Care Act insurance and 744 qualified to have cost-sharing subsidies as part of their enrollment, or almost 49 percent of enrollees, according to statistics provided by The Associated Press.

The total cost-sharing subsidy the federal government paid to insurance companies for Bartholomew County enrollees was $999,036.

Republicans in Congress have tried repeatedly to repeal or largely dismantle the Affordable Care Act but have been unable to muster enough votes among their own party.

A national survey by Oliver Wyman, a consulting firm, found that 43 percent of insurers have asked for rate hikes with an average increase of more than 20 percent. About 36 percent are seeking premium increases of between 10 percent and 20 percent. The remainder are seeking rate increases in the single digits.

Last year, six insurers submitted plans to Indiana regulators to provide coverage on the exchange. Two of those insurers, Physicians Health Plan of Northern Indiana and IU Health Plans, later withdrew their plans and said they would not participate.

One ongoing concern about health coverage is whether the Trump administration would stop paying the subsidies that lower out-of-pocket costs for low-income Americans, a question that was answered Thursday when the president signed an executive order ending the subsidies.

“Hallalujah,” Metz said of the president’s decision to end the subsidies.

“An an American, it’s a total ripoff the way Obamacare was set up,” he said. “We’re paying more, and the government is paying more and the insurance companies are doubling their profits.”

The so-called cost-sharing subsidies defray out-of-pocket expenses for people with low to modest incomes and can reduce a deductible of $3,500 to a few hundred dollars. Assistance is available to consumers buying individual policies and nearly three in five customers qualify for help — an estimated 6 million people or more.

The annual cost to the government is about $7 billion.

Metz said he wished politicians had just left the health care situation alone and he could go back to buying his own insurance privately at a cheaper cost with a lower deductible.

Republic Assistant Managing Editor Julie McClure and The Associated Press contributed to this story.

For more information

For additional information about buying health insurance on the Obamacare marketplace, visit