PORTLAND — This is what competition looks like: One health insurer wants to charge $169 a month next year to cover a 40-year-old Portland-area nonsmoker. Another wants $422 a month for the same standard plan.
The new health insurance marketplace envisioned by federal health reforms doesn’t formally kick in until fall. But it already is taking shape — and consumers for the first time can compare, premium by premium, identical plans by different insurers.
Soon they’ll be able to compare benefit-by-benefit as well.
This week, a comparison of proposed 2014 health premiums became public online, causing two insurers to request do-overs to lower their rates even before the state determines whether they’re justified.
The unusual development was sparked by a comparison that used to be impossible because plan benefits varied so widely. But under the federal reforms that take effect Jan. 1, health insurance is mandated and every insurer must offer certain standard plans.
Starting in October, the change will drive competition in a health insurance marketplace called Cover Oregon where individual consumers and small-business owners can comparison shop. Though the state’s comparison charts are far less detailed, they foreshadow what Cover Oregon is trying to do.
“Posting rate comparisons company-by-company is a taste of what is to come,” says Cheryl Martinis of the Oregon Insurance Division.
Judging by the reaction, there’s already an impact.
Providence Health Plan on Wednesday asked to lower its requested rates by 15 percent. Gary Walker, a Providence spokesman, says the “primary driver” was a realization that the plan’s cost projections were incorrect. But he conceded a desire to be competitive was part of it.
A Family Care Health Plans official on Thursday said the insurer will ask the state for even greater decrease in requested rates. CEO Jeff Heatherington says the company realized its analysts were too pessimistic after seeing online that its proposed premiums were the highest.
“That was my question when I saw the rates was, ‘Can we go in and refile these?'” he said. “We’re going to try to get these to a competitive range.”
The oregonhealthrates.org website provides the filings by the individual carriers and a comparison of certain requested rates in the individual and small-business market, broken down by region. The rate comparison shows identical standard-benefit plans rated bronze, silver or gold for their level of benefits for small businesses, as well as individual nonsmokers aged 21, 40 and 60.
The easy rate comparison is only one of the changes consumers who buy their own insurance can expect in 2014.