Health care consultant PwC released a report on Tuesday that found 12 million people will use coverage from exchanges in 2014 while paying 455 billion in premiums for the coverage. The exchanges will take place online and will be done in virtual marketplaces where consumers can shop for the necessary coverage needed. By 2021, PwC’s report says that the number of people could increase to 29 million and the premium payments could reach $205 billion.
The report said that the majority of the money will be new money but some of it will come from premiums that are transferred from other areas of the insurance market. The numbers also hinge on the number of states deciding to expand Medicaid coverage, which is required by the health care overhaul.
“These are the people who’ve been crowded out of the insurance market through the relentless drive to increase premium and pass along higher cost of health care to the consumer,” Sheryl Skolnick said. Skolnick is a CRT Capital group analyst.
Health insurers will be taxed in the overhaul and it will also restrict how the insurers are permitted to set their coverage. The overhaul will also provide “the last great frontier for health plans to add membership,” according to Skolnick.
“All the bad news (from the law) is pretty obvious, but the good news isn’t, and until it is, it’s not going to be fully reflected in the stock market,” she said.