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Obamacare deductibles are on the rise for 2017, along with monthly premiums

A woman looking at the Healthcare.gov internet site.
Karen Bleier | AFP | Getty Images
A woman looking at the Healthcare.gov internet site.

Those cheap Obamacare plans are getting even more expensive.

Deductibles for individuals enrolled in the lowest-priced Obamacare health plans will average more than $6,000 in 2017, the first time that threshold has been cracked in the three years that Affordable Care Act marketplaces have been in business, a new analysis finds.

Families enrolled in bronze plans will have average deductibles of $12,393, according to the study by the consumer insurance comparison site HealthPocket.

A deductible is the amount of money someone must personally pay out of pocket for health services before insurance covers the remaining cost.

HealthPocket also found that that average premiums, or monthly payments, for bronze plans nationwide will increase 21 percent next year for people who earn too much to qualify for Obamacare subsidies. A 40-year-old unsubsidized bronze plan customer would pay $350.23 each month for their health coverage, compared to $289.88 per month this year.

That's more than three times the 6 percent increase in average deductibles for bronze plans in 2017.

And deductibles for the second-least-expensive types of plans, silver plans, will average $3,572 for individuals next year, about 15 percent more than this year's average deductible for silver plans, the study found

Deductibles for families covered by silver plans are up by the same amount, for an average of $7,474 next year.

Premiums of all silver plans are rising by an average of 17 percent nationwide. A 40-year-old person enrolled in a silver plan who wasn't eligible for financial aid would pay an average of $410.73 per month for insurance, compared to $351.02 this year.

The findings are yet more daunting news to Obamacare customers who do not receive financial aid to offset either the price of their monthly premiums, or their out-of-pocket costs.

The analysis come two days after the Obama administration revealed that the premiums for so-called "benchmark" silver plans are set to rise in 2017 by an average of 25 percent next year in 39 states served by the federal insurance exchange HealthCare.gov. That increase, which will affect unsubsidized customers, is more than triple the average price hikes seen for plans in 2016.

The price of benchmark plans, the second-lowest-cost silver plans in a given insurance market, are used to determine the value of subsidies granted to Obamacare customers whose incomes qualify for such aid.

About 85 percent of customers who buy Obamacare plans on government-run marketplaces have low or moderate incomes that qualify for subsidies that reduce their premiums. Nearly 60 percent have low enough incomes to also get help reducing their out-of-pockets costs, in the form of deductibles, co-payments and co-insurance costs.

Health and Human Services Department Secretary Sylvia Burwell has noted that 72 percent of customers of the federal Obamacare marketplace HealthCare.gov will be able to find an insurance plan that will cost them $75 or less in monthly premiums after subsidies are factored in.

But millions of people do not qualify for such assistance, because they either make too much, or because they earn less than 100 percent of the federal poverty level.

Those people, when open enrollment in 2017 plans starts next Tuesday, will be facing some tougher choices over what plans to buy, or if they can even afford to buy them. Under the ACA, most Americans must have some form of health coverage or be subject to a fine that can equal 2.5 percent of their household income.

"With respect to 2017, it is immediately evident that the market conditions facing the unsubsidized are getting considerably worse," HealthPocket's report said. "The percentage increase for each category of Obamacare nationwide is in the double-digits."

"Deductibles among bronze and silver plans, the plans most likely to be purchased by people without subsidies, are still considerably beyond what the average family has saved for medical bills," the report said.

HealthPocket noted that older people who are not subsidized are are particularly at risk from the increases in premiums, because they can be charged higher rates than younger people.

"For example, when examining an individual who makes $48,000 annually (just above the $47,520 cut-off for individual premium subsidy eligibility in 2017, 60-year-olds would need to spend 22% of their income to afford that average silver plan premium while 30-year-olds would only need to spend 9%," the report said.

Obamacare plans are divided into four metal tiers — bronze, silver, gold, and platinum. Bronze plans tend to have the lowest monthly premiums and the highest deductibles. Silver plans as a rule have higher premiums than bronze plans, but lower deductibles. That pattern continues up to platinum plans, which have the highest premiums and the lowest deductibles.

Most subsidized Obamacare customers opt for a silver plan, because the subsidies can significantly reduce their premium, and because silver plans are the only type of coverage for which the out-of-pocket financial subsidies can be applied.

HealthPocket found that gold plans will see their premiums rise by an average of 22 percent. Nationally, the average 40-year-old enrolled in a gold plan would pay, before subsidies, $522.45 per month, compared to an average of $428.51 this year for the same type of plan.

For platinum plans, premiums are rising by an average of 15 percent in 2017.