Oregon’s Insurance Market Faces Rising Premiums, but the State has Options to Stabilize the Marketplace

OSPIRG Foundation

A new Report from OSPIRG Foundation and Frontier Group finds that rising health care costs and disruptive policy changes by the Trump administration and Congress have driven up premiums on the individual health insurance market.  The average monthly premium for the second cheapest silver plan on the marketplace was $443 in 2019, nearly double the cost of a similar plan in 2014. While Oregon’s health insurance marketplace has remained strong for the moment, serving 148,000 Oregonians in 2019, high premiums and the potential for further federal disruptions such as the pending lawsuit Texas v. Azar put the market at risk of increasing instability and an insurance death spiral.

Representative Salinas, for State District 38 and Chair of the House Health Care Committee said, “Oregon needs a health care system that serves all consumers.  Caught between rising healthcare costs and the recent disruptive decisions of Congress and the Trump administration, many Oregonians have been unable to find affordable, comprehensive health coverage on the marketplace.  Taking steps to stabilize the individual insurance market are an important part of moving our state towards a more universal system of care.”

The Report considers a number of policy options that Oregon could implement to bring premiums under control, stabilize the individual market, and expand consumer choice. “Please read this report,” said Rob Nosse, Representative for Oregon State District 42, “If we want to achieve universal care and access to care or “single payer” we need to  figure out how to make providing health care less expensive.” The policies the report addresses include:

• Explorating Creation of a Public Option: Oregon could provide additional choices to consumers by allowing consumers to “buy-in” to a publicly managed health plan.  Representative Mitchell, of state district 32 said, “The Oregon Health Plan provides high-quality, affordable care to nearly a million Oregonians. As we look forward to the next steps in Oregon’s health care transformation, I believe we need to consider allowing all Oregonians the opportunity to ‘buy-in’ to the Oregon Health Plan, which would make us the first state in the nation to offer a “public option” health plan.  This could go a long way to decreasing costs and increasing choice and competition, especially in rural counties that currently have few options on the marketplace.”

• An Individual Mandate: Massachusetts, New Jersey, Vermont, and Washington D.C. all require consumers to carry health coverage or face a penalty, replacing the national Affordable Care Act mandate that was repealed in 2017.  Revenue from the mandate could be used to help consumers pay for premiums.

• Protect Consumers who are Not Eligible for Tax Credits: after the Trump administration stopped paying cost sharing reduction subsidies in mid-2017, health insurance premiums rose around 10% nationwide.  While most Oregonians are eligible for tax credits to help pay for insurance, those who are not eligible struggle to find options on the market. Oregon could change its insurance regulations to bring down premiums for these consumers.

While the Report finds that these and other options could help stabilize the market and bring down premiums, its overarching conclusion is that achieving long term stability requires the state to bring rising health care costs under control.  “Oregon needs to take on the problem of health care costs,” said Mark Griffith, OSPIRG Health Care Advocate, “however, the policy options described in this report provide a path forward to improving marketplace stability and improving consumer choice.”