08/16/2022 | Press release | Distributed by Public on 08/16/2022 06:27
AUGUST 16, 2022 08:21 AM (EDT)
Best's Commentary: Inflation Reduction Act Will Benefit U.S. Health Insurers
CONTACTS:
Doniella Pliss Director +1 908 439 2200, ext. 5104 [email protected] |
Christopher Sharkey Manager, Public Relations +1 908 439 2200, ext. 5159 [email protected]
Jeff Mango |
FOR IMMEDIATE RELEASE
OLDWICK - AUGUST 16, 2022 08:21 AM (EDT)
AM Best is of the view that the Inflation Reduction Act (IRA) of 2022 contains several important provisions for the health insurance industry, with a material short-term benefit from extended Affordable Care Act (ACA) subsidies.
As of January 2022, a record 14.5 million were enrolled in an ACA exchange plan, up 21% from 2021. Higher subsidies play a significant role in supporting the ACA market throughout the United States. In its Best's Commentary, "Inflation Reduction Act Will Benefit U.S. Health Insurers," AM Best notes that the health insurance industry estimated that two to three million people would drop their ACA policies if the subsidies were not extended past the 2023 expiration. With the extension of the expanded subsidies through passage of the new law, health carriers are likely to keep most of the members who joined ACA exchanges in recent years.
"Health carriers have expanded their presence in the ACA markets the past few years," said Doniella Pliss, director, AM Best. "The segment's financial performance has improved substantially following the deep losses of earlier years, as carriers learned to design and manage ACA products, regulators allowed needed rate increases and subsidies and cost-sharing reductions made products affordable for consumers."
Other provisions that will affect health insurers in the intermediate term are:
To access the full copy of this commentary, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=322984 .
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in New York, London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.