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Small Business Employee Benefits and HR Blog

Montana Health Insurance Exchange Update - Rates Lower Than Expected

Recently, the Montana Health Insurance Exchange released proposed rates for individual, family, and small group health insurance plans that will be offered through the new exchange. The Montana Health Insurance Exchange will open for enrollment on October 1, 2013 with plan coverage starting January 1, 2014. Montana decided to operate their exchange through the federally-facilitated health insurance exchange, also called the "Marketplace." However, Montana will maintain oversight of the plan management functions, meaning Montana will manage, process, and approve all plans and rates.
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Montana Health Insurance Exchange - Individual Plan Rates

How will the rates compare to current individual and family rates in Montana?

A recent study conducted by the Montana Commissioner of Securities and Insurance (CSI) showed that the premium rates for both individual/family and small group policies will be lower than the current market, and lower than many experts expected. 

According to Montana Insurance Commissioner Monica Lindeen, an average 40-year-old individual currently pays a premium of, on average, $290 per month. The estimated premium cost for a 40-year-old individual through the Montana Health Insurance Exchange is $273 per month. (Source: Montana CSI.)

These premium rate estimates do not include individual health insurance premium subsidies that eligible individuals may receive from the federal government (read more on the individual health insurance premiums here). Additionally, the actual premium cost will depend on what level of plan the policy holder chooses ("platinum," "gold," "silver," or "bronze") as well as tobacco use.

As exchange plan rates are being announced across all states, Montana is one of the many states where rates are lower than expected. Why is this a surprise? Individual and family plan rates were generally expected to increase because of the entrance of the unhealthy into the individual market. 

Under ObamaCare, all people are guaranteed health insurance and medical underwriting is not allowed (although some uprating is allowed based on age, tobacco use, and by location). In addition, all products sold in the public health insurance exchanges are required to cover all “essential health benefits,” which include products and services that were not always covered in Montana’s individual health insurance policies prior to ACA. 

Montana Health Insurance Exchange - Small Group Plan Rates

Currently, small groups pay, on average, $450 a month per employee for a comprehensive small group plan. The Montana CSI estimates small group coverage in 2014 to be $350 a month per employee through the Montana SHOP exchange.

Montana Health Insurance Exchange - Carriers

According to the Montana Insurance Commissioner's Office, Montana received proposals from three insurance companies to offer health insurance plans on the Montana Health Insurance Exchange:

  • Blue Cross Blue Shield of Montana

  • PacificSource

  • Montana Health Co-Op (new)

All Montana Health Insurance Exchange plan rates and carriers will be finalized prior to the opening of the exchange on October 1, 2013.