Marketplace Money reports that a PwC study finds that Obamacare plans are actually lower cost than comparable plans outside the Health Insurance Exchanges.
“That’s one of the misperceptions out there. That somehow they are barebones or you are not really getting adequate medical insurance,” she says.
Connolly says even when you factor in all the out-of-pocket costs, the average top tier gold and platinum plans are similar to employer ones.
So did President Obama just drive a tough bargain? The answer is, not exactly. There are two reasons why the Exchange plans may be lower cost. First, exchange plans have notoriously narrow networks. Although exchange plans have similar monetary generosity as employer plans, they offer fewer provider choices.
Second, exchange plans may be using long-term pricing strategies. Basically, health insurers may be willing to take a loss this year. The reason is that switching plans is expensive for individuals. Even if there is no monetary cost, to switch plans requires doing research and understanding whether your favorite provider is on the plan, what the coverage is and other factors. Thus, once people enroll on the exchange plans, health insurers may increase premiums to take advantage of this lock-in effect.