Pennsylvania’s Insurance Department is hosting informational meetings across the state, ahead of open enrollment seasons this fall.

“We're trying to go into communities to let people know what may be coming,” said Michael Humphreys, commissioner of Pennsylvania Insurance Department. “and also really drive home that this open enrollment period more than ever, its going to be really important to shop for coverage to see what options are available in your area."

People shopping on Pennie, the state’s public health insurance marketplace, could see premium rates rise by 20%. Private or workplace rates are also expected to increase.

“There's just a number of different cost drivers all coming together at the same time,” Humphreys said. He pointed out two factors that are impacting the entire health insurance industry.

First is that the cost for medical care rises at a faster rate than average cost of living.

“It’s what the cost of the service is for the provider issuing the service. That includes the administration of providing services— time, staffing, benefits,” Humphreys said. "Everything that goes into the administration of the business of providing healthcare, continues to drive up that faster rate than what we see in ordinary economic growth."

Secondly, people are using more of their benefits, more often. Prescriptions, scans, out patient services are happening more than the past few years.

“In part, that could be because we're finally coming out of COVID, in a sense that providers have been able to staff back up,” Humphreys said. "We’re able to see patients faster, more frequently.”

There is a third cost driver specific to Pennie.

A federal tax credit for Pennie enrollees is expiring in December; which will force people to pay closer to the original price of their plan. Around 90% of enrollees could see an 82% increase in their costs. To put in context—  Humphreys said that a 60 year old married couple living in York County who make $82,000 in annual income, could go from paying $7,000 a year to $35,000 a year. 

“That’s almost half of the income for that family,” Humphreys said.

Faced with unaffordable health insurance, its not uncommon for young healthy people to drop their coverage. The people who stay often have health issues, and are more likely to use benefits or need costly services.

Insurance companies expect the loss of young people, and are raising their rates in advance to help pay for the higher risk patients who will stay.

Humphreys says there are some bipartisan conversations about extending the tax credits for another year or two. He says it would be ideal for that change to happen before open enrollment begins, so there can be consistency and less chance of people dropping insurance if the credits are not extended initially.

“It's really hard, and I think that's why it's important to go and look at what options are available,” Humphreys said.

One way to save on monthly costs while still having coverage for emergencies is to find a higher deductible plan— paying more upfront if you get medical services—can lead to lower monthly bills.