Lower Premiums But Higher Out-of-Pocket Costs for 2020 ACA Consumers

Open enrollment for individual and family health insurance under the Affordable Care Act (ACA) started on November 1 and continues through December 15, 2019. For people who buy health insurance on their own, this may be their only chance to get a new health plan for next year.

What should they expect in terms of costs?

There’s good news on that front, but a strong word of caution too. eHealth’s recent survey of 2020 ACA plans shows that a lower price tag doesn’t always translate to lower overall costs.


Monthly Premiums Are Going Down
eHealth’s analysis finds that average monthly premiums are going down in 2020 compared to 2019.

For example, the average premium for a Bronze plan for a single 40-year-old is decreasing 3%, from $407 to $393. Families will also see lower monthly costs. A family of four (two adults age 40 and two children under age 14) will find average premiums down 4% for a Bronze plan, from $1,299 to $1,253 per month.

Premiums for Silver plans are declining 6% for 40-year-old individuals (from $542 to $512 per month) and 6% for families of four (from $1,729 to $1,633).

That’s definitely good news for health insurance consumers. But there’s more to the picture.


Out-of-Pocket Costs Are Going Up
Out-of-pocket costs (deductibles and copays, for example) are what you pay when you receive covered medical care under your health insurance plan.

Unfortunately, out-of-pocket costs are increasing for 2020 at about the same rate that premiums are going down.

Next year, for example, average Bronze plan deductibles are increasing 4% (from $6,181 to $6,419) for 40-year-old individuals, while the average maximum out-of-pocket limit -- the most you’ll pay for covered medical care during the course of the year -- is also increasing 4% (from $7,458 to $7,731).

For a family of four, average Bronze plan deductibles are rising by 3% (from $13,017 to $13,394), while the average maximum out-of-pocket limit is increasing 4% (from $14,916 to $15,462).


2020 Out of Pocket Costs


What This Means for Open Enrollment Season
In the end, 2020 is going to be a mixed bag for people who buy ACA health insurance. Lower premiums can sometimes mask higher out-of-pocket costs, and that can lead many people to unexpectedly spend more money over the course of a year for their medical care. That’s why it’s important to make the most of the open enrollment season and review coverage choices for next year – even if you’re happy with your current plan and ultimately decide to stick with it for 2020.

And if you don’t qualify for government subsidies, it’s a good idea to review coverage options beyond what Healthcare.gov and state-run marketplaces are offering. Government-run sites do not display all ACA-compliant health plans available to people who pay the full cost of their health insurance coverage. That means you might find a plan better suited to your medical needs and budget by shopping for ACA coverage available through licensed private marketplaces like eHealth or direct through insurers.

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