In its 2014 filing with the Colorado Department of Insurance, Rocky Mountain Health Plans notes that “annual increases in the cost of health care are expected to continue, since there are not inherent cost controls in the new plan designs.” The filing reports that a two-year health care cost increase trend of 16.3 percent was used.
It estimated the cost of the ObamaCare mandatory plan add-ons at $17.93 per member per month. It estimated that ObamaCare taxes and fees, with other licensing fees, add 3.77 percent to the gross premium index rate, slightly over $16 a month. This includes the cost of the Health Insurance Provider Tax, the Exchange Fee, the Patient Centered Outcomes Research Tax, the Risk Adjustment, and the Data Collection Transitional Reinsurance Contribution.
It calculated its gross premium index rate at $437.01 per member per month. Allowable rating factors are applied to this amount to calculate specific premiums. For example, someone 25 years old living in Denver who purchases a Silver HSA policy with a $2,500 deductible would pay approximately ($437.01) times the age factor (1.004), the geographic area rating factor (0.97), and the plan factor (0.706) to arrive at an approximate premium of $300 a month.
For this policy, the ObamaCare cost increases of almost $34 a month are slightly more than 10 percent of premiums.
For comparison, a grandfathered, medically underwritten health savings account qualified policy in Denver for a young adult with prescription drug coverage, a similar deductible, and a nationwide network currently costs about $180 a month.
Linda Gorman is Health Care Policy Center Director at the Independence Institute, a free market think tank in Denver