BALTIMORE — Changes in Health Insurance Costs
As open enrollment begins, you might notice some shifts in health insurance costs. Specifically, these changes are largely due to the ending of enhanced federal tax credits.
The Maryland Health Benefit Exchange states that many of the 300,000 Marylanders who purchase insurance through the state’s marketplace could see their premiums rise notably when these credits expire at the year’s end.
To help alleviate the impact, the Maryland General Assembly has approved a temporary measure aimed at reducing costs for some residents. The relief varies depending on one’s income. Under Maryland’s premium subsidy program, many enrollees facing steep rate hikes will end up paying significantly less.
For instance, a 30-year-old man earning around $39,000 currently pays $61 a month, but that could jump to $275 without federal help. Fortunately, under the new Maryland program, he would only pay about $121.
Michele Eberle, the executive director of the Maryland Health Benefits Exchange, mentioned that the law aims to protect residents lacking employer-sponsored insurance.
“We could provide state subsidies to fill the gap, especially for low-income individuals,” Eberle stated. “For middle-income individuals, we can assist about 50%. However, those earning above 400% of the federal poverty level (which stands at $128,600 for a family of four) won’t receive any assistance. So, they might see a substantial increase.”
For people like Bobby Laughlin, the insurance market in Maryland is crucial.
“I have two jobs; I work at a restaurant and also do HVAC installation,” Laughlin explained.
Neither of his jobs offers health insurance, so he opts for a plan through Maryland Health Connection.
“It allows me to get a decent health insurance plan at a reasonable cost,” he said.
And it’s fair since he doesn’t pay full price.
“The law acknowledges that when you can’t access health insurance through your employer, you often need assistance to manage your monthly premiums,” Eberle added.
This support stems from an enhanced federal tax credit, funded by taxes owed by consumers. However, unless Congress intervenes, these credits are set to expire soon, and this situation is becoming a focal point in the ongoing federal funding discussions.
“I pay less than $70, about $68 a month,” Laughlin noted.
Without those tax credits, his costs would soar to about $400.
Thanks to a one-year subsidy approved by the Maryland General Assembly, his premiums will be closer to $140 instead of $400, but eligibility varies.
Eberle expresses concern that rising prices might discourage individuals from obtaining insurance.
“People want health insurance for themselves and their families. But if they have to choose between food and insurance, we know which one they’ll pick,” she acknowledged.
This year, there are additional changes. DACA recipients, approximately 300 residents in Maryland, are no longer eligible for Marketplace coverage, and some low-income immigrants may also lose premium deductions or face extra documentation requirements.
Despite these changes, Eberle emphasizes that it’s still essential for residents to explore their options.
“Costs are rising, but there are still choices available. While they may not be as affordable, many services provided are pre-deductible, and many health benefits can be accessed by getting vaccinated and scheduling regular doctor visits,” she said.
Bobby believes these benefits make his plan worthwhile and is anxious not to lose it.
“This insurance is fantastic, and I’m really grateful for it. I don’t want to see it disappear,” he said.
Eberle reassured that Maryland would be ready to adjust tax rates quickly if Congress renews federal tax credits, even after the new year has started.
If you’re looking to purchase insurance via the state marketplace, remember to register by January 15th. Eberle suggests taking action sooner rather than later, and she encourages reaching out to a navigator for assistance in selecting the best plan.
