DENVER - Colorado insurance companies submitted their new plans to the Colorado Division of Insurance on May 15. The initial analysis of those new rates will be released to the public on May 22.
The group insurance rates are expected to increase between 13 and 30 percent, but it is the increase for individual health insurance that could skyrocket.
"We have heard from various insurance carriers on the individual market rates could go anyplace from 60 to 120 percent higher than the current market," Steven Roper with Roper Insurance said.
The rate increase is in response to the Affordable Care Act which was signed into law on March 23, 2010. As part of the law on January 1, 2014, all Americans must purchase health insurance. It also requires insurance companies to offer coverage to everyone, including individuals with pre-existing health conditions.
The Affordable Care Act in Colorado will be administered through the Colorado Health Exchange. Individuals and companies will be able to purchase insurance through the exchange, or they may go outside of the exchange to purchase health insurance. The Colorado Health Exchange will offer four levels of coverage, including bronze, silver, gold and platinum. Bronze plans will come with the lowest premiums, but will have the highest annual deductions. Platinum plans will come with the highest premiums and the lowest deductibles.
The government will help to subsidize health insurance payments for single individuals who make less than $44,700 a year. A family of four making less the $92,200 will also qualify for an insurance subsidy.
The penalty for individuals deciding to not purchase health insurance in 2014 is $95 or up to 1 percent of your income, whichever is higher. In 2015 that penalty increases to $325 or 2 percent of a person's income, whichever is higher.
"So people, as consumers are going to go through and make the decision, do I opt out and just pay the penalty which is going to be a lot cheaper than purchasing the insurance," Roper said.
Small business owners may be in the toughest situation. The Affordable Care Act requires companies with more than 50 full time employees to offer health insurance.
"We are seeing a lot of major disruption because our clients are very, very scared. People in the service industry, people in low income types of industries, the people who this law was intended to protect are going to get impacted the most," Roper said.
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