* Tribune editorial…

On Monday, Illinois citizens were jolted by a piercing pain in the wallet as federal officials unveiled proposed Obamacare insurance premium rates for 2017. Insurers plan to dial up rates as much as a heart-stopping 45 percent for those who buy plans on the Obamacare marketplace when open enrollment starts Nov. 1.

That means thousands of people will scramble for affordable insurance … and won’t find it.

* From the US Department of Health & Human Services…

Statement by Press Secretary Jonathan Gold on Illinois health insurance rate changes:

“Consumers in Illinois will continue to have affordable coverage options in 2017. Last year, the average monthly premium for people with HealthCare.gov coverage getting tax credits increased just $4 from $102 to $106 per month, despite headlines suggesting double digit increases. People in Illinois understand how the Marketplace works, and they know that they can shop around and find coverage that fits their needs and budget. In fact, last year more than 53 percent of them did exactly that by switching plans to save money. In addition, the vast majority of consumers in Illinois qualify for tax credits that reduce the cost of coverage below the sticker price. Today’s announcement is just the beginning of the rates process, and consumers will have the final word when they vote with their feet during Open Enrollment.”

Background

Proposed rates aren’t what consumers pay. While today’s filings show an average rate increase in Illinois, a report from the U.S. Department of Health and Human Services demonstrates that proposed premium changes from preliminary rate filings do not capture what Marketplace consumers actually pay. Last year, the average monthly premium for people with HealthCare.gov coverage getting tax credits increased just $4 from $102 to $106 per month, despite headlines suggesting double digit increases.

Most people receive tax credits and can buy a plan for less than $75 per month.

75% of Marketplace consumers in Illinois receive tax credits, which are designed to protect consumers from premium increases and help make coverage affordable.

Tax credits increase if the cost of the second lowest-cost silver, or benchmark, plan goes up. So if all premiums in a market go up by similar amounts, 75% of Marketplace consumers in that market will not necessarily pay more because their tax credits will go up to compensate. Average rate increases reported with the preliminary rate filings do not account for tax credits.

For 2016 coverage, 53% of customers in Illinois had the option of selecting a plan with a premium of $75 or less per month after tax credits.

Shopping: The ACA Marketplace helps consumers shop around for the best deal.

Prior to the ACA, it was nearly impossible for consumers to compare plans and shop around easily – and many Americans went uninsured because they couldn’t afford insurance or had pre-existing conditions. Those who did have insurance in the individual market were often trapped in the plan they had, since people with even small health problems could be denied coverage or charged an exorbitant price if they tried to switch plans or issuers.

Today, Marketplace consumers in Illinois can purchase any available plan regardless of health conditions, and tools such as the doctor lookup and out-of-pocket cost calculator help them find the plan that meets their needs. Last year, 53% of returning Marketplace consumers in Illinois switched plans. They saved an average of $636 annually.

Based on an examination of preliminary 2017 rate filings for nine states that released rates earlier this year, Avalere found that the average rate increase for lowest and second-lowest cost silver plans was 7-8%, about half the overall average rate increase in these states. That difference highlights how consumers can benefit from shopping around.

A major new issuer, Cigna, has indicated it will begin offering plans in the Chicago area for 2017, which will further bolster choice and competition in the Illinois Marketplace.

Prior to the Affordable Care Act, plans were typically inferior and excluded services like maternity care, or even routine services like prescription drugs. Plans also often charged a higher premium, or denied coverage altogether, to consumers due to a pre-existing condition. Now, all consumers have the option to purchase quality, affordable coverage.

This is a big deal for as many as 5,636,000 people in Illinois with a pre-existing condition.

Preliminary rates aren’t final rates. Preliminary rates often change significantly before being finalized. In particular, they are subject to rate review, which led to $1.5 billion in savings for consumers in 2015. Last year, final rates in some states were below proposed rates.

Health insurance is clearly something people in Illinois like, want, and need: 388,179 people signed up for 2016 coverage through the Marketplace.

Since major provisions of the Affordable Care Act went into effect, Illinois’ uninsured rate fell from 14.2 percent in 2013 to 7.9 percent in 2015 for non-elderly residents, according to new data released recently.

Both Marketplace and non-Marketplace consumers continue to benefit from the low health care cost growth of recent years.

Marketplace rates remain well below expectations when the law was passed. Marketplace rates for 2014 came in about 15% below Congressional Budget Office (CBO) projections in 2010. Better-than-expected Marketplace premiums are due in large part to lower-than-expected economy-wide health care cost growth and other efficiencies.

For the half of Americans who obtain health insurance through an employer, premiums for family coverage grew by an average of 5% per year from 2010 to 2015 – compared with about 8% per year from 2000 to 2010. Premiums grew at an even slower 4.2% rate in 2015. If premium growth since 2010 had matched the average growth rate over the prior ten years, the average family premium would have been almost $2,600 higher in 2015.

All emphasis was in the original.