Five years ago, most New Jerseyans who purchased health insurance on the federal marketplace established under Obamacare paid premiums that were among the nation’s highest. But in 2019, costs for those same plans will rank among the least expensive.
That shift — from the state with the ninth-highest premium price in 2014, to the 47th highest in 2019 — is among the findings of the latest report by New Jersey Policy Perspective, a progressive think tank.
NJPP has long tracked the impact of Obamacare, formally known as the federal Affordable Care Act, which created the marketplace to expand insurance options for low-income Americans; some 340,000 Garden State residents now obtain coverage as a result of this program.
Since the system’s launch in 2014, the price of the most popular marketplace plans have increased 9 percent in New Jersey, while the average cost nationwide soared 75 percent, NJPP found. And the 2019 rates here — which dipped an average of 9 percent over the current year’s costs — are 94 percent lower than those in Delaware, 61 percent less than in New York, and 38 percent under those in Pennsylvania.
State action credited
“These changes continue the downward trend we’ve seen in premiums in the market compared to other states,” said Ray Castro, NJPP’s director of health policy. And the savings did not come as a result of reducing the scope of coverage, he noted. “We’ve reduced the premiums but still are providing a high-quality product.”
NJPP and others credited the new savings and market stability to recent reforms approved by Gov. Phil Murphy, a Democrat, which they said were particularly important given the Republican-led efforts in Washington, D.C. to dismantle the ACA. (Uncertainty over the law’s fate last year contributed to a nearly 20 percent increase in average premium costs in New Jersey, insurance companies have said.)
Earlier this year the state adopted an individual insurance mandate, similar to the federal income-tax penalty imposed on those who did not obtain coverage, which President Donald Trump eliminated last year. It has also established a re-insurance program to offset the impact of significant claims, which state officials expect will be funded by federal dollars to the tune of $218 million in the first year alone.
One of the few states able to boast
“We are one of the few states across the nation that this year can boast that, because of these actions, things have actually improved for consumers,” said Maura Collinsgru, director of health programs at New Jersey Citizen Action, who joined NJPP in releasing the report Thursday. “Now we’ll be able to turn our full attention to filling in the gaps in coverage that remain.”
In all, the ACA has enabled more than 800,000 additional New Jerseyans to obtain health insurance, including some 500,000 who qualified for Medicaid when the law expanded eligibility for the existing public program. Another 340,000 were able to purchase coverage as a result of the new marketplace; more than four in 10 of these customers also get subsidies to offset the cost of premiums, according to NJPP.
The potential savings enjoyed by those marketplace customers add up significantly over time, NJPP points out, but only if the current state and federal policies remain intact — something that is far from certain, Castro conceded. But assuming the status quo, the shoppers who qualify for subsidies — those with lower incomes — could save at least $3.2 billion over the next 10 years, the group calculated.
Healthcare costs continue to soar
The good news comes as healthcare costs continue to escalate overall, with healthcare spending rising 18 percent on average in New Jersey between 2012 and 2016, according to an analysis shared in October by the New Jersey Health Care Quality Institute. Nationwide, spending increased 15 percent over that same time, based on claims from a number of large insurance companies, and these rising costs are reflected in the price of health insurance for many consumers.
The release of the NJPP report also gave Collinsgru and state Department of Banking and Insurance Commissioner Marlene Caride an opportunity to remind residents that it is currently the open enrollment period for marketplace plans, which runs for another month. They stressed that, in addition to lower prices, on average, many people can qualify for premium subsidies, which are available to individuals who earn as much as $48,560 annually, or up to $100,400 for a family of four.
“We have a short window and it’s important we get the word out so that by December 15 we are able to enroll as many New Jerseyans as possible,” Caride said. Two weeks ago the Murphy administration launched the state’s first coordinated effort to boost ACA signups with the Get Covered campaign. “Please don’t delay,” she added.
In addition, Castro noted that there were several new, lower-cost plan options available in 2019 for health insurance customers who do not qualify for the subsidies or other discounts available through the marketplace. These new silver-level plans could save families thousands of dollars next year, according to NJPP; but they are only available directly from the insurance companies and not listed on the marketplace. (Shoppers are urged to check the DOBI website for details.)