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Pennsylvania Secedes From ACA (And Why Other States Are Doing It Too)

How and why Pennsylvania is leaving the Obamacare marketplace is part of a much larger trend. But don’t worry- that trend is geared toward helping people save money.

Affordable healthcare has been a primary talking point in politics since the launch of the Affordable Care Act in 2013, and since then, most states have used HealthCare.gov to serve individuals that purchase coverage. The marketplace is experiencing a new life after the regular enrollment period, thanks to President Biden’s extension on Obamacare enrollment.

Even with this new life that’s been given to public health insurance, Pennsylvania is breaking away from the Affordable Care Act marketplace. Pennsylvania is planning to save millions of dollars in health plan premiums through “Pennie,” its state-run healthcare insurance exchange that will roll out soon. This is the new trend among a group of states that are choosing to move away from the federal marketplace and opting to introduce state-run insurance exchanges.

Other states taking over their healthcare exchanges soon include New Jersey and Pennsylvania, which will begin enrollment on November 1 this year. This fall, New Mexico and Kentucky will launch and revive their exchanges, respectively. Maine is planning to debut its healthcare exchange this year while Virginia is planning to begin the process next year or in 2023.

Lawmakers in these states argue that the federal marketplace has become too costly, and they believe they can provide better service for much less. The self-contained healthcare exchanges aim to pass on the anticipated savings to the policyholders, which is great news.

Studies show that state marketplaces are attracting more consumers than the federal-run exchange, especially young adults, thanks to the promise of better savings. The policymakers claim that they can run the state exchanges more efficiently and are in a better position to respond to the needs of both residents and insurers. At the end of the day, it all boils down to getting the best deal.

Difficult Economic Times

“Over 11 million people receive coverage through federal and state exchanges, and more than 80% of these people get federal subsidies aimed at lowering their cost of insurance.”

-Healthcare.gov statistics

The COVID-19 pandemic has caused economic turmoil around the country, with millions of people losing their jobs and businesses, leaving them with no source of income. The fear of getting the virus and not being able to access the necessary healthcare is real and justified. As a result, most people are looking to sign up with the state-run exchanges to take care of their current and future health needs. By operationalizing the state-run exchanges, the policyholders will ease their residents’ burdens.

States that have their healthcare exchanges have achieved a much higher rate of enrollment compared to those that use the federal exchange. The lower premiums, as well as better consumer protection and education, have contributed to this high enrollment. This trend will likely continue, and it is an important selling point for the state-run exchange.

States Taking Control

Policyholders argue that their healthcare exchanges will allow them to control their destinies since they currently rely on the federal government. The states are hoping to continue to attract younger consumers who are more likely to be healthy, and this is a significant move towards helping the marketplaces to spread the risk. According to experts, spreading the insurance risk is a sure way to keep the premiums down.

The effort to hold down insurance premiums has continued to increase since the pandemic has increased the demand for accessible healthcare. States hope to enroll more residents in their marketplace health plans, and they have the data necessary to embark on targeted enrollment. Thanks to Penny, Pennsylvania will save $50 million every year, which they can use to support the reinsurance program that is required for individuals with very expensive healthcare needs. Furthermore, the state will have between $1.2 million to $1.6 million for navigators to aid with enrollment, an amount that is close to four times what the federal government allocates.

How Can I Sign Up For My Insurance?

No matter what state you live in, the path to health insurance can be a tough road to travel down alone. That’s why it’s worth it to get in touch with the experts at Health Plan Options Today to understand all the health insurance options that are available to you. Call the hotline at 888-375-8879 or click below to get more information from our team.