2023 Affordable Care Act Health Insurance Marketplace

Key Points

• For plan year 2023, eight insurers are offering 128 health insurance plans on the Kansas marketplace.
• The average monthly premium for a benchmark silver plan in Kansas for a family of four in 2023 before applying Advance Premium Tax Credits (APTC) increased by 8.2 percent, which was more than the 4.4 percent increase nationally.
• The deductible for the benchmark silver plan ranges from $2,000 to $5,800 for an individual and $4,000 to $11,600 for a family in 2023.
• For the 2023 plan year, the Inflation Reduction Act is making APTC available to consumers with household income above 400 percent of the federal poverty level (FPL) to help them pay for monthly premiums, unless the benchmark silver plan premium is less than 8.5 percent of their household income.

KHI also has published statewide maps showing 2023 marketplace enrollment in Kansas.

Introduction

The tenth annual open enrollment period (OEP) for the Kansas health insurance marketplace, created by the Affordable Care Act (ACA) and operated by the federal government through Healthcare.gov, began on Nov. 1, 2022, and ended Jan. 15, 2023. While the OEP for plan years 2018 through 2021 lasted only 45 days, from Nov. 1 through Dec. 15, the Centers for Medicare and Medicaid Services (CMS) announced in September 2021 that starting with plan year 2022, the OEP would begin running from Nov. 1 through Jan. 15 to provide consumers with an additional 30 days to review and sign up for coverage. For plan year 2023, coverage for individuals who enrolled by Dec. 15 became effective Jan. 1, 2023. Coverage for individuals who enrolled after Dec. 15 but by Jan. 15 became effective on Feb. 1, 2023.

For plan year 2023, the Inflation Reduction Act of 2022 makes it possible for individuals enrolling for plan year 2023 to continue to benefit from the enhanced Advance Premium Tax Credits (APTC) made available in 2022 through the American Rescue Plan Act of 2021 (ARPA). The Inflation Reduction Act extends the temporary enhancements of the ARPA through plan year 2025.

Prior to 2023, an estimated 40,000 Kansans were not eligible to receive premium tax credits due to what was known as the “family glitch.” The “family glitch” refers to a 2013 ACA implementation rule that applied to families of individuals with employer-sponsored insurance to determine whether the cost of the coverage was affordable, thereby making the employee and their family ineligible for APTC to purchase coverage on the marketplace. Under this rule, coverage was considered affordable based solely on the cost of only the employee’s premium, even if premiums for the whole family were not affordable. In 2022, prior to the start of the 2023 OEP, the Biden administration and the Internal Revenue Service finalized a rule to address the family glitch to allow the cost of family premiums to be used to determine affordability, thereby potentially making more spouses and children eligible for APTC to purchase coverage on the marketplace.

This brief provides information about plan options offered for the 2023 plan year, health insurance costs, financial assistance options and factors impacting enrollment.

Plan Options

For the 2023 plan year, eight insurers are offering 128 health plans on the Kansas marketplace (Figure 1) ─ an increase from 2022 when 123 plans were available from seven insurers. The companies include Blue Cross and Blue Shield of Kansas, Inc. (103 counties); Medica Insurance Company (94 counties); Ambetter from Sunflower Health Plan (91 counties); UnitedHealthcare Insurance Company (21 counties); Cigna Health and Life Insurance Company (8 counties); US Health and Life Insurance Company (7 counties); Oscar Insurance Company (2 counties) and Blue Cross and Blue Shield of Kansas City (2 counties).

All eight insurers are offering expanded bronze, silver, and gold plans. Five insurers are offering bronze plans, and three insurers are also offering catastrophic plans. For the sixth consecutive year, there are no platinum plans being offered to individuals on the Kansas marketplace. Like in 2022, all counties in Kansas have at least two insurers offering coverage and all plans offered are exclusive provider organization (EPO) plans, which only cover services provided in-network by a “narrow network” of providers, except in an emergency.

Under the ACA, dental coverage is an essential health benefit for children enrolled in an ACA-compliant health plan and is included in the premium cost, but not for adults. Some insurers offer policies with both health and dental coverage for adults, meaning the premium covers both health and dental policies and APTC can be applied.

Alternatively, adults can purchase a stand-alone dental plan, but they also must be enrolled in an ACA-compliant health plan and will be responsible for two separate premiums. APTC cannot be applied to stand-alone dental plan premiums. There are a total of 15 stand-alone dental plans available from five insurers for 2023.

Health Insurance Costs

The consumer’s health care cost depends on their monthly insurance premiums and their out-of-pocket costs for deductibles, co-payments, co-insurance, and uncovered services.

Premiums on the Kansas marketplace increased in plan year 2023. The average premium for a benchmark silver plan in Kansas for a family of four is 8.2 percent higher than it was in plan year 2022. The increase in the average benchmark silver plan premium in Kansas for a family of four was higher than the 4.4 percent increase nationally. Figure 2 shows average monthly premiums across all counties in Kansas for the benchmark silver plan.

As shown in Figure 3, there is considerable variation in monthly premiums across counties. For example, in rating area 4 the difference in premiums for the benchmark silver plan for a couple age 60 is around $700 and premiums can be greater than $2,200 per month for families and older adult couples. Premiums vary based on regional factors such as the cost of care, cost of living, and number and type of providers available. Premiums also vary based on specific characteristics of the persons being covered, including age, where they live, whether they smoke and how many people in their family are covered. Higher rates cannot be charged based on gender or for people with preexisting health conditions.

In addition to the monthly premium paid, consumers are responsible for certain out-of-pocket expenses, including deductibles, co-payments, and co-insurance when they use services. Except for certain preventative and other services specified by plans, consumers must pay the deductible amount for covered services first before the insurance plan starts to pay. Co-payment or co-insurance are usually required after the deductible is met. The deductible for the benchmark silver plan ranges from $2,000 to $5,800 for an individual and $4,000 to $11,600 for a family in 2023. The lowest deductible benchmark silver plans are being offered by a new insurer to the Kansas marketplace and are only available in nine counties. Outside those nine counties, the typical deductible for a benchmark silver plan for an individual is $5,400 in 82 counties and $5,800 in 14 counties, and the deductible amount is generally doubled for a family plan.

ACA marketplace plans also are required to state a maximum out-of-pocket cost, which is the most that consumers could pay for covered services in the plan year. This maximum amount varies by consumer’s income. However, regardless of income (if eligible for marketplace coverage), the maximum amount a consumer could be expected to pay for covered services is up to $9,100 for an individual or up to $18,200 for a family of four.

Financial Assistance

The ACA made financial assistance available to marketplace enrollees at certain income levels to help pay monthly premiums and out-of-pocket expenses. Prior to enactment of the ARPA and the Inflation Reduction Act, consumers with household income between 100 and 400 percent of the federal poverty level (FPL; $26,500 to $106,000 for a family of four in 2021) were eligible for APTC and spent between 2.0 to 9.83 percent of their income for their insurance premiums.

Under the ARPA, and now the Inflation Reduction Act, consumers in 2023 with household income between 100 and 400 percent FPL ($27,750 to $111,000 for a family of four in 2022) will spend between 0 and 8.5 percent of their household income on premiums for a benchmark silver plan. Households with income above 400 percent FPL also are eligible for APTC that cap their premiums for a benchmark silver plan at 8.5 percent of their income. Consumers with household income between 100 and 150 percent FPL ($27,750 to $41,625 for a family of four in 2022) may qualify for a free or nearly free marketplace plan. In addition, lawfully present immigrants with annual household income below 100 percent FPL may qualify for APTC and other savings on the marketplace if they are not otherwise eligible for Medicaid and meet other eligibility requirements. Other people under 100 percent FPL are generally not eligible for financial assistance on the marketplace. These enhanced marketplace subsidies were set to expire at the end of 2022 but were extended by the Inflation Reduction Act to the end of 2025.

APTC are based on the cost of the benchmark silver plan but may be used to purchase any plan available on the marketplace, regardless of the metal level. APTC cannot be used to purchase a catastrophic plan. With APTC, consumers could be better off with a more benefit-rich gold plan with a lower deductible. For example, the cheapest gold plan in Sedgwick County could have a monthly premium of $359 before APTC (or $121 after APTC) and a deductible of $2,000 for an individual with household income of 250 percent FPL. In comparison, the same individual can purchase the cheapest silver plan with a lower monthly premium of $347 before APTC (or $109 after APTC) but would have a higher deductible of $5,700. Examples of reduced premiums from APTC in 2023 are shown in Figure 4.

Although the ARPA and the Inflation Reduction Act have made changes in APTC eligibility and the calculation of APTC, the rules for cost-sharing reduction (CSR) subsidies remain the same. Under the ACA, consumers with household income between 100 and 250 percent FPL ($27,750 to $69,375 for a family of four in 2022) who enroll in silver plans continue to be eligible for CSR subsidies to lower their out-of-pocket expenses. CSR subsidies are not available with any other metal level. For example, the deductible could be lowered to $550 with co-payment/co-insurance for a benchmark silver plan for an individual in Sedgwick County with income between 100 and 150 percent FPL. An individual in Sedgwick County with income between 151 and 200 percent FPL could see their deductible lowered to $1,500 with co-payment/coinsurance for a benchmark silver plan.

Factors Impacting Enrollment on the ACA Marketplace

For 2023, several factors may impact enrollment.

• Continuation of enhanced APTC provided in ARPA and the Inflation Reduction Act through 2025.
• Insurers being prohibited from refusing to renew coverage for people who fell behind or failed to make premium payments during 2022.
• Special Enrollment Period for individuals who lose their Medicaid or CHIP coverage beginning on March 31, 2023, due to the unwinding of the continuous coverage provided during the COVID-19 public health emergency.
• A reduction in the documentation required for individuals to prove they are eligible for a special enrollment period due to a “qualifying event,” such as divorce or marriage.
• A new federal rule fixing the “family glitch” that allows the cost of a family’s premiums rather than the individual employee’s to be used to determine affordability, thereby potentially making more spouses and/or children eligible for APTC to purchase marketplace coverage.