Why the ACA's Limits on Age-Rating Will Not Cause "Rate Shock"

This report examines the ACA’s 3:1 age rating band, which stipulates that premiums for adults age 64 can be no more than three times higher than the premiums for adults age 21 for the same coverage, and its impact on health insurance premiums. The authors found that loosening the rate band to a 5:1 ratio would have very little impact on out-of-pocket rates paid by the youngest purchasers once subsidies were taken into account, and the majority of young adults currently purchasing nongroup coverage will also be financially protected by the exchange subsidies, the ACA's Medicaid expansion, and the expansion of dependent coverage to young adults.