Scenarios for Vermonters moving from traditional health insurance to the Exchange

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Scenarios for Vermonters moving from traditional health insurance to the Exchange

Mon, 04/01/2013 - 4:56am -- intern

Here are some examples of what it would mean for different Vermonters to purchase health insurance in the Vermont Exchange instead of today’ s commercial market based upon the proposed filed rates that are subject to review by the Green Mountain Care Board.
For full article about the proposed rates for plans in Vermont’ s Health Benefit Exchange, click here.
Example one: A couple with Catamount shops in the exchange
Ellen and Tom have a family income of $32,000 a year and no children. Before 2014, Ellen and Tom were enrolled in Catamount Health policies with a premium of $911 per month. Ellen and Tom received Catamount Health Assistance and paid a total of $248 per month.
In 2014, when Ellen and Tom buy a policy in the Vermont Health Benefit Exchange, their monthly premiums will be about $895 per month. They will qualify for a federal premium tax credit of $721 per month and state premium assistance of $40. Together these would reduce their monthly premium to $134. Their total annual savings in 2014 compared to 2013 would be $1,368 per year.

Example two: A single person buying coverage in the exchange
Bill is a single self-employed electrician in St. Johnsbury. He earns $40,000 and buys one person non-group coverage. Bill’ s premium is $600 per month.
In 2014, when Bill purchases coverage in the Exchange, Bill’ s premium will be $448 per month. Bill will qualify for a federal premium tax credit of $283, but will not qualify for state premium assistance. Financial assistance will reduce his cost of coverage to $317 per month. His savings will be $283 per month and he will have reduced what he spends on health insurance by 47 percent.

Example three: A family looks at buying in the exchange
John and Mary are a couple with two children. Together, their annual income is $32,000. Before 2014, they bought family non-group coverage with a $10,000 deductible that costs $700 monthly.
In 2014, when they shop in the Vermont Health Connect they will find that a family plan costs $1,257 a month. They are eligible for premium assistance and reduced cost sharing. Their federal premium tax credit of $1,171 and state premium assistance of $41 will reduce their monthly premium cost to $45 per month. Instead of paying a $10,000 deductible, their deductible will be $100.

Example four: A small company purchases exchange coverage
XYZ Company is owned by Mr. Jones who has seven employees. The XYZ payroll looks like this:
Mr. Jones $150,000
Employee One: $41,400
Employee Two: $37,000
Employee Three: $37,000
Employee Four: $37,000
Employee Five: $37,000
Employee Six: $37,000
Employee Seven: $37,000
Mr. Jones and five of the employees have family coverage and by coincidence they each are married and have three children; employees six and seven are unmarried and have no children. Prior to 2014, XYZ buys small group coverage with a $2,500 personal deductible for everyone. This coverage costs $12,800 per month or $153,600 annually, and he and his employees contribute 20 percent of their premium ($30,720).
Comparable health insurance in the Exchange will cost XYZ about $10,000 per month. The company will also be eligible for a small-employer tax credit equal to 16 percent of its contribution to the cost of health insurance benefits.

*Pending approval by the Legislature. State premium assistance is calculated based on the proposal included in the House Appropriation’ s budget.