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Public HIX Give Commercial Plans a Run for Their Money

Christopher Cheney, for HealthLeaders Media, February 5, 2014

Connolly said she and her colleagues had assumed the public exchange rates would be higher based on "the early chatter—early rhetoric that the exchanges were really expensive."

Two experts in the health insurance field find the PwC results more refreshing than surprising.

"The market was moving toward cost-control strategies" before implementation of the federal Affordable Care Act, said Alex Feldvebel, deputy commissioner of the N.H. Insurance Department. "The carriers were looking for ways to limit costs increases to consumers… You have the phenomenon that the market is reaching an affordability barrier."

Prior to the PPACA, insurers used "risk selection tools" to avoid insuring individuals who would file the most claims such as people with pre-existing conditions, he said. With a decreased ability for insurers to limit costs, "they are aware that they are going to compete more on price," Feldvebel said, adding the PPACA has "cleared the way to more aggressive negotiations with providers."

Linda Tiano, who works in the healthcare and life sciences practice of the Washington, DC-based law firm Epstein Becker Green, said the PwC study confirms an undeniable truth. "They're all trends that would have happened anyway," she said of the relatively low cost to policy holders in the public exchanges. "Premiums are so high, we as a society have to find ways to reduce them."

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