How Will ACA Federal Exchange Premiums Affect Ohio Small Businesses and Consumers?

Joe Popp | August 16th, 2013

By now, you’ve been hearing a ton about the Affordable Care Act (yes, even from us), and you may be getting tired of all this news. However, it’s critical for you and your business to stay up-to-date on what is changing and what is being decided as it relates to the ACA. The Ohio Department of Insurance (DOI) recently announced in a press release that if you’re an individual consumer who chooses to buy health insurance through the federal government’s insurance exchange, you’ll be paying approximately 41 percent more than what you paid in 2013. And if you’re a business owner, you’ll see somewhere in the ballpark of an 18 percent increase. 

Observations on ACA Federal Exchange/Marketplace Premiums and Ohio

If your eyes are bulging now, don’t worry. That’s to be expected. If you are feeling some sticker shock, take a step back and consider a few of these interesting points:

  • Two months ago, the DOI said that the rate increase would be 88 percent for individuals. However, now it has said the individual rate will be around a 41 percent increase. We have a month and a half to go until the exchange applications will be available… it is certainly possible that the final individual rate increase could be even lower.
  • These rate increases only apply to exchange insurance. If you consider the fact that private market insurance rates are also increasing, some well over 50 percent increases, a 41 percent or an 18 percent increase starts to look pretty good.
  • Don’t forget about the subsidies! The rate increase listed does not include federal premium subsidies, which in many cases will actually decrease the cost of insurance for many people. The DOI hasn’t attempted to inject what any subsidy savings might be into the average calculation. So don’t take these figures as a true comparison of what the average person would be paying last year versus under the exchange – they are comparing gross rates to gross rates only.

ACA Federal Exchange Premiums Help

We still have time until we’ll feel the impacts of the exchange insurance rates. Have you looked at your eligibility for subsidies as an individual? Your financial advisor can tell you based on your last year’s tax return!  As a business owner, have you considered what the potential savings might be to you or your employees if you drop coverage and instead help defray your employees’ exchange insurance cost? If you have questions or don’t understand how these premiums may affect you or your business, contact Rea & Associates. Our team of Ohio tax professionals can help you put an action plan in place that makes the most sense for your business!


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