Next year all health insurance plans must meet the essential health benefits to be considered a Qualified Health Plan (QHP)
These requirements are base on:
- If the plan is offered inside or outside the exchange
- IF the plan is fully insured or a self funded plan
Premiums for Individual and small groups will no longer be based of health status. They will be based off of family tier, age, geography, and Tobacco use.
All of the plans must use a 3 to 1 age bands. This means the highest premium cannot be more than 3 times the lowest premium for the same plan.
All of these requirements will impact rates.
Health Insurance premiums on Individual plans will sky rocket. Under the new guidelines, health plans will be required to cover more benefits. The coverage of maternity on an individual health plan will have a huge impact on premium.
Small group rates will very interesting. A young healthy group could see a large increase but an older high claims group could see a decrease. The healthy group will help to offset the high claims group. That is if the healthy group keeps a group health plan in place.
When it comes to rating in geographical areas is a very interesting topic. There are some counties that are much healthier than others in the area. If we were to compare Hamilton County to Lake County there should be a large difference in rates. Hamilton County is a healthier county and should have lower rates than a county like Lake, where utilization is very high. Could this type of rating have an impact on where business chooses to be located?
What about Indianapolis businesses that border other states? If a company in Elkart, has employees crossing over to Illinois for medical services will they have higher rates? There is a chance they will have higher group rates because medical services in Illinois cost more than Indiana.
The geographical question for health insurance in 2014 is going to play a huge issue on group health insurance rates.