Individuals and small businesses on Long Island will have more and cheaper options for health insurance next year, according to the state, which Wednesday released the plans to be offered.
On Oct. 1, New York plans to open up its health insurance marketplace -- known as the health benefit exchange -- for lower-cost health insurance as part of the federal Affordable Care Act. On Long Island, 13 companies will offer plans for individuals. That's about four times the current number of insurers, and the cost will be much lower.
The cheapest plan for an individual now costs about a $1,000 a month; under the insurance exchange plan New York Fidelis, a statewide government programs-based insurer, will offer a lower-cost plan for $284.50 monthly.
"On average, the approved 2014 rates for even the highest tier of plans individual New York consumers could purchase on the exchange (gold and platinum) represent a 53 percent reduction compared to last year's direct-pay individual rates," Gov. Andrew M. Cuomo said in a news release. And many will qualify to receive subsidies that may lower rates even more.
The tier system
The plans, which would go into effect on Jan. 1, are organized in platinum, gold, silver and bronze tiers based on range of coverage, which should make it easier for New Yorkers to compare plans, Cuomo's office said.
The state attributed the rate reductions to more uninsured individuals buying coverage in the individual insurance market. About 1.1 million uninsured New Yorkers are expected to get insurance on the exchange over a three-year period, the state predicts. That includes about 146,000 from Long Island, according to the Urban Institute.
For small businesses on Long Island with as many as 50 employees, up to 10 insurers will be offering plans. The governor's office said the average small business rate for the "benchmark" silver plan is about 32 percent lower than the nationwide average forecast by the nonpartisan Congressional Budget Office. That is despite "the relatively higher per capita health care costs in New York compared to other states," the state said.
Some advocates and experts were thrilled with the offerings while some insurance brokers expressed skepticism.
"People priced out of the market are now priced in the market," said Gwen O'Shea, president of the Health & Welfare Council of Long Island.
David Sandman, senior vice president of the nonprofit New York State Health Foundation, called the plans "great news."
"The benefits of health reform are starting to become real for New Yorkers," he said.
Peter Newell, director of the health insurance project at the nonprofit United Hospital Fund in Manhattan, praised both the state and the health insurers. "The result is a really cooperative effort," he said. "The health plans really stepped up."
One of the new health insurers listed for Long Island is North Shore-Long Island Jewish Health System. Spokesman Terry Lynam said North Shore-LIJ is waiting to get a license that will enable it to sell insurance both on and off the exchange.
"Because this is new for us, we're going to be cautious in our approach," he said. "We don't want to get too big too fast."
For Jack Glanzer, president of The Granite Insurance Brokerage in Garden City, the offerings raise questions. Currently, he said, no individual on Long Island can get health insurance for anything less than $1,000 a month, and usually the cost is much higher. He questioned the exchange's low rates. "How are they getting to these numbers?" he asked, referring to the insurers. He said it would be key to know if the insurer's networks of doctors and other providers would be "tiny."
Frequent reviews pledged
In response, the state Department of Health said the exchange would review plan networks as part of the certification process and then quarterly to ensure "there are an adequate number of providers."
Eileen Falk of Baranello Associates, insurance brokers in Great Neck, said that despite the reduction in rates, they would still be too high for many. "How is anybody going to be able to afford these prices?" she said.
The health department said that based on predictions from the Urban Institute, 75 percent of those who enroll on the individual exchange will qualify for financial assistance.
John Sardelis, associate chairman of health care management at St. Joseph's College in Patchogue and Brooklyn, said he has little doubt more New Yorkers will get coverage because of the exchange. But he said the larger question is whether the Affordable Care Act will have reduced costs, "or have we subsidized an overly expensive system?"