Study projects individual premiums to drop 30% in Ohio

Analysis by conservative think tank the Manhattan Institute has concluded that average premium rate in Ohio on the federally facilitated insurance marketplace next year will be 30 percent less than average current individual premium, and that is without considering tax subsidies (Source: “Surprise: Forbes blogger/Obamacare critic concludes the health law will reduce Ohio premiums,” Cleveland Plain Dealer, Sept. 4, 2013)

The analysis was conducted for 13 states plus Washington D.C. in which marketplace premium data has been made publically available.

Avik Roy, a senior fellow at the Institute, said the results for Ohio were a surprise.

"Yevgeniy Feyman, the Manhattan Institute research associate who led our team of graduate-student number-crunchers, re-checked the Ohio data several times to make sure we hadn’t made a mistake," Roy wrote on his Forbes magazine blog, noting that the projection varies sigificantly from the Ohio Department of Insurance estimate in August that average rates would increase by 41 percent.

"The difference between our numbers and the state’s appears to have to do with differences in our methodologies," Roy wrote. "The state looked at the average premiums for all plans offered in the state this year, vs. all plans offered in the exchanges under Obamacare. We, on the other hand, examined the five cheapest plans offered in each circumstance. While the average plan will be more expensive in Ohio, the Obamacare exchanges will offer a wider diversity of options there, including less-expensive ones."

The analysis comes a week after the Rand Corporation released a study that found that marketplace premiums in Ohio would be 21 percent less than what individual premiums would have been without passage of the Affordable Care Act (click here for Health Policy Review coverage). The Rand analysis, however, accounts for tax subsidies in its average prices. Rand estimates that 62.6 percent of Ohioans would be eligible for tax subsidies on the marketplace, while the Manhattan Institute estimates that 39 percent of Ohioans will receive a subsidy.