Analysis: Premiums could soar 40%

Premiums in the 2021 individual healthcare market could spike 40 percent or more in 2021, according to an analysis by Covered California.

The rates for next year are being set “right now,” and will be drastically affected by the Covid-19 pandemic, the state Obamacare operation said March 24.

“Given that insurers will be submitting 2021 rates in May and finalizing them around July 1, congressional action is needed very soon in order to affect 2021 premiums,” Covered California chief actuary John Bertko said.

“While there is a lot of uncertainty with anything related to COVID-19, one thing we can be certain of is that the impact will be significant, and now is the time to take action.”

Covered California sent its policy/actuarial brief “The Potential National Health Cost Impacts to Consumers, Employers and Insurers in the Commercial Market Due to COVID-19” to members of Congress. It said the analysis provided the first national projection of healthcare costs linked to the coronavirus (COVID-19) pandemic.

“Absent federal action, consumers, employers and our entire health care system may be facing unforeseen costs that could exceed $251 billion,” said Covered California chief Peter Lee. “Consumers will feel these costs through higher out-of-pocket expenses and premiums.”

The one-year projected costs in the commercial market range from $34 billion to $251 billion for testing, treatment and care specifically related to COVID-19, the analysis found.

“These increased costs could mean that many of the 170 million Americans in the commercial market may lose their coverage and go without needed care as we battle a global health crisis,” Lee warned.

Covered California urged Congress to enhance financial assistance provided in the individual market and to establish a temporary program to limit the costs of COVID-19 for health insurers.

The analysis comes days after Covered California announced a special-enrollment period for uninsured individuals who need health care coverage amid the COVID-19 pandemic. It runs through June 30.