COLUMBIA (AP) — South Carolinians who buy a mid-range health insurance plan through the online marketplace accessible next week will pay about $339 a month, according to federal figures released Wednesday ahead of the Oct. 1 launch of the exchange created under the federal health care law.
That average represents the sticker price for uninsured residents, before federal subsidies, which work like upfront discounts for eligible residents.
South Carolina is among 36 states that opted against running their own exchanges, leaving that to the federal government. The law requires insurers participating in the exchange to offer plans within four tiers: bronze, silver, gold and platinum. However, no company is offering platinum-level options to individual buyers in South Carolina, according to the state Department of Insurance.
The federal report said South Carolina residents will be able to select from an average of 26 plans, depending on where they live.
The in-state average individual premium for a benchmark policy known as the “second-lowest-cost silver plan” is $11 more than the national average. But averages can be misleading. What residents pay out-of-pocket for premiums will vary widely, with factors including family size, age, income and even tobacco use.
According to the federal agency, a benchmark plan for a 27-year-old nonsmoker in S.C. making $25,000 a year would cost $223 monthly, before federal subsidies cut the average to $145 a month.
A family of four with a $50,000 income would pay $809 a month without the tax credit and $282 with it.
The second-lowest-cost silver plan is important because tax credits are keyed to its cost in local areas.
But consumers don’t have to take silver. All the plans cover the same benefits and cap annual out-of-pocket expenses at $6,350 for an individual, $12,700 for families.
The big difference is cost sharing through annual deductibles and copayments. Bronze covers 60 percent of expected costs; silver, 70 percent, on up to platinum at 90 percent. Bronze plans have the lowest premiums and the highest cost sharing.
The federal report gave more specific details for residents of Columbia. They’ll be able to choose from 28 plans. That hypothetical 27-year-old would pay $90 monthly after subsidies for the lowest plan in the bronze tier, while that family of four would pay $84 monthly after credits for the lowest bronze plan.
Starting Jan. 1, virtually all Americans will be required to carry health insurance or face fines. At the same time, the health care law will prohibit insurance companies from turning away people in poor health, or charging them more. And it will limit what insurers can charge their oldest customers.
Experts said the plans under the health care law are not comparable to what’s currently sold on the individual health insurance markets, because the coverage is broader and the financial protection for policyholders is more robust.