Today, Governor Andrew M. Cuomo announced that the Department of Financial Services (DFS) has approved health insurance plan rates for 17 insurers seeking to offer coverage through New York's Health Benefits Exchange, including eight new entrants into the market that do not currently offer commercial health insurance plans. Last year, Governor Cuomo took action to issue an Executive Order establishing the New York Health Benefit Exchange, which is expected to help more than one million uninsured New Yorkers access quality, affordable health care coverage.
Consumers and businesses will be able to choose among plans in four easy-to-compare metal tiers (bronze, silver, gold, and platinum) on the exchange. The plans within each metal tier will have standardized contract terms and product offerings, making it easier for consumers to truly comparison shop and encourage real price competition among insurers. Previously, New York insurers offered more than 15,000 plans that widely varied in terms of level and quality of coverage provided -- which encouraged "competition through confusion' and made it difficult for purchasers to effectively compare plans side by side.
"New York's health benefits exchange will offer the type of real competition that helps drive down health insurance costs for consumers and businesses," said Governor Cuomo. "The opportunity to choose among affordable, quality health insurance options will mean improved health outcomes, stronger economic security, and better peace of mind for New York families."
Benjamin M. Lawsky, Superintendent of Financial Services: "In setting these rates, we worked hard to do right by consumers and small businesses so they have access to affordable, quality health insurance. Moreover, where New York previously had a dizzying array of thousands upon thousands of plans, small businesses will now be able to truly comparison shop for the best prices. New York will continue to move ahead rapidly so the exchange is up and running for 2014."
"The approval of health plan rates marks a significant milestone for the New York Health Benefit Exchange," said New York State Health Commissioner Nirav R. Shah, M.D., M.P.H. "The state continues to be on target to begin enrolling consumers and small business owners and their employees in health insurance coverage on October 1, 2013. Access to affordable, quality health care will mean better health, peace of mind and financial security for New Yorkers."
On average, the approved 2014 rates for even the highest tier of plans individual New York consumers could purchase on the exchange (gold and platinum) represent a 53 percent reduction compared to last year's direct-pay individual rates. The fact that these average individual rates are effectively being cut more than in half is primarily because a greater number of uninsured individuals are expected to obtain coverage in the individual insurance market -- lowering overall premiums. (Note: That 53 percent reduction does not include the impact of federal financial assistance for individuals meeting certain income thresholds who are purchasing coverage on the exchange, which would lower costs even further for many consumers.)
Furthermore, despite the fact that health care costs per capita are approximately 18 percent higher in New York than the national average, the average approved rates for the benchmark individual "silver plan" in New York would be in line with (nearly 10 percent lower) the nationwide average previously forecast by the independent, non-partisan Congressional Budget Office (CBO) for when health care reform is implemented.
For approved 2014 small group plan rates, existing premium rates do not provide a functional year-over-year comparison. In 2013, insurers offered more than 15,000 different small group plans that significantly varied in terms of the quality and level of coverage provided. This year, insurers are offering standardized contracts and product offerings within metal tiers (bronze, silver, gold, and platinum).
The approved small group rates, however, are generally lower than indicated by the estimates of other independent forecasters. The average approved small group rate in New York for the benchmark "silver plan" is well below (nearly 32 percent lower) the nationwide average previously forecast by the independent, non-partisan CBO -- notwithstanding the relatively higher per capita health care costs in New York compared other states. Moreover, a number of small businesses will be eligible for tax credits that would lower those premium costs even further.
The following companies had health insurance plan rates for the health benefits exchange approved today by DFS. The rates approved today are subject to final certification of the insurers' participation in the exchange.
Affinity Health Plan, Inc.
American Progressive Life & Health Insurance Company of New York
Capital District Physicians Health Plan, Inc.
Health Insurance Plan of Greater New York
Empire BlueCross BlueShield
Healthfirst New York
HealthNow New York, Inc.
MetroPlus Health Plan
MVP Health Plan, Inc.
North Shore LIJ
Oscar Health Insurance Co.
Individuals with incomes below 400 percent of the federal poverty level ($45,960 for individuals and $94,200 for a family of four), could qualify for financial assistance that lowers cost of coverage. Enrollment for the exchange begins on October 1, 2013 for coverage that will be effective January 1, 2014.
"These plans and rates deliver on the promise that the Exchange will offer quality health insurance coverage at a price that works for New Yorkers," said Donna Frescatore, Executive Director, New York Health Benefit Exchange. "We were pleased to see that there was much interest from health plans regarding participation in the Exchange. Our partners at the New York State Department of Financial Services did a thorough job of negotiating affordable prices while ensuring that consumers will have access to the providers they need. Robust competition among health plans has resulted in meaningful choices and better options for consumers."
For more information about the New York Health Benefit Exchange, please visit, HealthBenefitExchange.ny.gov.
For a listing of the health insurance plan rates approved today by region, please visit: www.governor.ny.gov/assets/documents/Approved2014HealthInsuranceRates.pdf