ObamaCare’s impact on health costs.

“Earlier today, Marilyn Tavenner of the Centers for Medicare and Medicaid Services announced that “more than 6 million Americans have signed up for coverage through the Health Insurance Marketplaces since October 1, thanks to the Affordable Care Act.” Given all of the technical problems that dogged healthcare.gov last October, this is an impressive turnaround. But it sheds little light onto the two questions most analysts are focused on. First, how many of those signing up have paid their first month’s premium, thereby activating coverage? And second: How many of those with coverage were previously uninsured? At this point, we have no definitive answers.”

[T]he MLR caps will also limit innovation. Right now, expenses that are on a pre-approved, government list of “activities that improve health care quality” are not included in the cost of administration and so don’t count against the 20 percent cap on what plans get to spend on overhead. If a health plan comes up with a new business approach that it believes improves quality and outcomes, it will be forced to count the costs against its allowable profits. It can’t incorporate the cost into the total money it spends on healthcare if the new scheme isn’t on the government list.”

“In recent weeks, I’ve talked to a handful of large healthcare firms and medical practices that offer specialty medical services. I asked them what kinds of prices they’re soliciting from the new health plans now taking shape under Obamacare. These providers said that they’re demanding, and in some cases securing, pretty rich reimbursement rates from the new, Obamacare health plans.”

“The High Cost Plan Excise Tax, which is often referred to as the ‘Cadillac Tax’ is one of the revenue raising provisions in the 2010 Patient Protection and Affordable Care Act. The excise tax is calculated by comparing the cost of an employer-sponsored plan (which includes premiums paid by the employer and/or employee as well as any contributions into
health accounts such as health savings accounts of flex savings accounts) to a benchmark, which will be adjusted every year based on the Consumer Product Index (CPI). Any amount above the benchmark is taxed at 40 percent; this tax is levied on the health insurance company but is generally understood to be passed onto the consumer, or firm purchasing that plan.”

“Obamacare is imposing a minimum benefit for insurance that is in excess of what many consumers purchase on their own today. And the law is imposing many new rules on what insurance companies may and may not take into account when setting premiums. There is no experience anywhere indicating that these kinds of changes will lower premiums. And there’s an abundance of evidence from state experiments indicating that these changes will increase premiums, and probably quite substantially.”

“Mr. Alito pointed out that young, healthy adults today spend an average of $854 a year on health care. ObamaCare would require them to buy insurance policies expected to cost roughly $5,800. The law, then, isn’t just asking them to pay for ‘the services that they are going to consume,’ he continued. ‘The mandate is forcing these people to provide a huge subsidy to the insurance companies . . . to subsidize services that will be received by somebody else.'”

“Those two coverage areas – the individual and small group markets – face the biggest rule and cost changes next year, when the main provisions of the Affordable Care Act finally kick in. Early rate proposals around the country are a mix of steep hikes and modest increases.”

“Obamacare may cost more than experts previously thought, according to a survey of 900 employers released Wednesday. As companies scramble to prepare for a wave of new health care rules that go into effect next year, an increasing number have become pessimistic about the cost, according to Mercer, a benefits consulting firm. Roughly one in five employers (19 percent) now expect that health care costs will rise by more than 5 percent as the result of the law.”

“Ohio Department of Insurance officials announced last week that average premiums in the Buckeye state would soar 88 percent once President Obama’s health care law kicks in. The news added fuel to an already raging debate over Obamacare’s effect on insurance costs. Ohio’s insurance department disclosed that a total of 14 insurance companies had proposed rates on 214 plans to be offered through the federally run insurance exchange set to open on Oct. 1 and begin providing benefits in January.”

“It’s called the Affordable Care Act, but President Barack Obama’s health care law may turn out to be unaffordable for many low-wage workers, including employees at big chain restaurants, retail stores and hotels. That might seem strange since the law requires medium-sized and large employers to offer ‘affordable’ coverage or face fines.”