ObamaCare’s impact on health costs.
As candidates in both parties focus on the general election campaign, some Republicans wonder if large premium increases related to the Affordable Care Act could be an “October surprise” that helps propel them to victory in November. The causes of the approaching premium increases vary, but some are rooted in a 2013 Obama administration proposal.
In reporting on premium increases by one Iowa insurer, the Des Moines Register noted that individuals who bought new plans that complied with Affordable Care Act regulations could face premium increases of 38% to 43% next year.
For every action, there is an equal and opposite reaction. Political solutions from years past may materialize in the form of rate hikes this fall–and could generate a distinct reaction among voters on Election Day.
Hillary Clinton’s “Medicare for More” plan certainly would cover more people — but it could also raise health-care costs for some current Obamacare customers if they aren’t careful.
Nearly 13 million Americans age 50 to 64 who lack insurance or buy private health plans would be eligible to buy into an expanded Medicare program that the Democratic presidential contender has proposed, according to an analysis released Thursday.
. . .
Most Americans enrolled in health plans through the Affordable Care Act are happy with their coverage. But consumers are increasingly concerned about their monthly premiums and deductibles, reflecting rising anxiety among all Americans about their medical and insurance bills, a new national survey found.
Nearly 6 in 10 working-age Americans who have a health plan through one of the marketplaces created by the law said they are satisfied with their monthly premiums, and just over half say they are satisfied with their deductibles.
. . .
Health insurance is about to bear a higher price tag. Experts at the Kaiser Family Foundation just warned that premiums are likely to jump in 2017 — after increasing an average of more than 12 percent this year.
High-deductible health plans paired with tax-advantaged Health Savings Accounts (HSA) have emerged as a source of a lower-cost refuge for patients, who accept the high deductible in exchange for lower premiums.
The Obama administration is trying to restrict access to HSAs. That’s a mistake. HSAs empower consumers to take control of their health care and reduce overall health spending in the process. Our leaders should be working to expand access to them, not narrow it.
. . .
A plan the Clinton campaign unveiled in September would create a refundable tax credit worth as much as $2,500 per individual and $5,000 per family to cover out-of-pocket health-care expenses. Knowing there is a federal credit might give employees incentive to incur additional expenses to exceed the subsidy threshold. That would mean a credit aimed at mitigating the effects of rising health costs for some families could end up exacerbating the problem on a broader scale.
. . .
Obamacare has caused health insurance premiums to skyrocket. It has caused millions of Americans who liked their health plans to lose their health plans. It has caused doctor and hospital networks to narrow. Now the Wall Street Journal reports that the Obamacare exchanges in Alabama and Alaska will each have one—that’s right, one—insurer offering plans. We’re moving toward “single insurer” health care.
In short, Obamacare is wrecking the private health insurance market.
The Congressional Budget Office says that the Obamacare subsidies for private insurance will cost $43 billion this year alone. That’s an average of $5,375 per person for those who have been added to the private insurance rolls—or $21,500 per family of four. Meanwhile, the typical 36-year-old (or younger) who makes $36,000 a year (or more) gets $0 under Obamacare.
. . .
Rising rates are not solely the result of the uninsured who bought health plans on the exchanges having a tremendous pent-up demand for healthcare services. Many insurers also underpriced their plans to gain a larger share of the new market. The Congressional Budget Office found premiums in 2014 were 15% lower than expected.
The most significant factor behind next year’s sharply rising prices, experts say, is that millions of “young invincibles,” who represent a large segment of the uninsured pool, have so far not signed up for Obamacare.
“We saw very little of the young and healthy,” said Sherri Huff, a consultant and former chief financial officer of Common Ground Healthcare Cooperative in Wisconsin, one of the insurance co-ops funded by ACA loans.
. . .
Tens of thousands of Iowans who buy their own health insurance are about to receive a shock in the mail.
Wellmark Blue Cross & Blue Shield is sending letters this week telling about 30,000 customers it plans to raise their premiums by 38 percent to 43 percent next year.
Wellmark sells about three-quarters of individual policies in Iowa’s health-insurance market. The steep increases will affect people who bought relatively new plans that comply with rules of the Affordable Care Act.
Another 90,000 Wellmark customers who hold older individual insurance plans are expected to face smaller increases, which will be announced in June. The increases being proposed this week also don’t affect the hundreds of thousands of Wellmark customers who obtain coverage via their employers. Their premiums are expected to rise less, because they are in larger, more stable pools of customers.
. . .
California’s health insurance exchange estimates that its Obamacare premiums may rise 8 percent on average next year, which would end two consecutive years of more modest 4 percent increases.
The projected rate increase in California, included in the exchange’s proposed annual budget, comes amid growing nationwide concern about insurers seeking double-digit premium hikes in the health law’s insurance marketplaces.
Any increases in California, a closely watched state in the health law rollout, are sure to draw intense scrutiny during a presidential election. Republicans are quick to seize on rate hikes as further proof that President Barack Obama’s signature law isn’t doing enough to hold down health care costs for the average consumer.
. . .
As the fourth year of Obamacare approaches, Politico’s Paul Demko reports that consumers can expect more of the same price hikes and narrowed choices as they have seen the first three years. The Obama administration insists that prices only rose eight percent for 2016 over the previous year – even though that itself is still more than three times the rate of inflation, and ignores states like Minnesota where the average premium increase was over 30 percent.
“There are reasons to think the next round may be different,” Demko warns. He quotes a Deloitte executive who agrees. “A number of carriers need double-digit increases” for 2017. Those price increases will hit the Obamacare exchanges on November 1st, one week before voters elect a new President and Congress.
. . .