May 27, 2015

Report: Premiums higher on federal exchange plans

Premiums on health insurance plans available only on the federal Health Insurance Marketplace are, on average, more expensive than those sold both on and off the exchange, according to a new analysis by, a website that compares and ranks health insurance plans.

Using the government's public use files from the Health Insurance Marketplace, HealthPocket determined there were approximately 29 "metal" plans for every one such plan offered on the federal exchange, which was established under the Affordable Care Act. Metal plans are used under the ACA to convey a health plan's actuarial value, with plans ranging from bronze to platinum. The higher the value, the lower the out-of-pocket costs for consumers.

But those who buy insurance off the exchange are likely to pay higher premiums. HealthPocket found that the greatest disparity among bronze plans was that, on average, those sold only on the exchange were 15 percent more expensive than those sold both on and off the exchange. For silver plans, the difference was 7 percent, while the different among gold plans was 5 percent. Data on platinum plans wasn't available, according to HealthPocket.

The fact that many who purchase insurance through the exchange receive some subsidy for their insurance plans may be a factor that drives up premiums, according to Kev Coleman, head of research and data at HealthPocket.

"The higher average premiums we observed for health plans sold exclusively on-exchange may be the result of multiple factors. Among these … is the fact that health plans sold on-exchange are not paid for at list price by most enrollees but, instead, often have sizable premium subsidies applied. Off-exchange consumers are more likely unsubsidized and may be more price sensitive than on-exchange consumers who enjoy premium subsidization," Coleman said.


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