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ACA Fail Fractal
Aging Hipsters Priced Out of Obamacare

When insurance companies across the country requested hefty hikes for their Obamacare plan premiums, we noted that regulators might deny or scale back the requests. But the first official numbers are in from Oregon, and the results aren’t pretty for the ACA. Not only did the state’s Insurance Commissioner approve big premium hikes, she has even required insurers that didn’t request any increases to raise their prices. WSJ:

Laura Cali approved an average 25.6% increase for Moda Health Plan Inc., the biggest plan on the state’s health exchange. She also gave a green light to average increases of 30% or more for four smaller companies, in a decision released this week. And she required plans that hadn’t attempted to raise rates to do so anyway, including Kaiser Foundation Health Plan of the Northwest, by an average of 8.3% […]

“We share the concerns expressed through public comment about the affordability of health insurance in Oregon, and these final rates were approved in order to protect consumers from extreme rate increases in the future. Inadequate rates could also result in companies going out of business in the middle of the plan year, or being unable to pay claims,” she said in a statement.

Oregon news outlet The Oregon has more:

The more than 100,000 people who purchased Moda policies on the individual market will see increases of 25.6 percent more in 2016 compared to this year, or $307 per month for a 40-year-old Portland resident buying a silver plan (the example scenario the division uses to compare policies).

These rate hikes will be far more important for Obamacare’s future than the SOCTUS decision. The ACA’s failure to address the root causes of health care inflation means that the troubles with health care haven’t ended. In the near future, plans will be too expensive for too many families, with high deductibles and restrictions on doctor choice. Subsidies will help, of course, but they won’t fix the problem. The costs to government of subsidies will continue to increase, threatening the sustainability of the system and further burdening taxpayers.

The Obama Administration is apparently issuing more talking points for family conversations on Obamacare. Supporters in Oregon are going to need all the talking points they can get, if they want to avoid getting roasted at the family barbecue.

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  • qet

    I am the most cynical person I know and even I find it difficult to think ACA is as bad as it really proves itself to be every other week. The HHS talking points thing is Gruberism at its finest, resting safely and comfortably on the knowledge that the American people really are so stupid that you not only can talk to them in this pre-K manner but they will love you for it also and trust implicitly that your propaganda amounts to an actual refutation of the facts that those nasty evil GOP voter types keep trying to distract us with.

    • Andrew Allison

      You obviously don’t know me! The bad news is that a majority of the American people really are stupidly self-interested.

  • theresanursemom

    Has anyone actually considered that making health insurance premiums prohibitively expensive to the point where people don’t buy into the system and subsequently lose much of their tax refund from the IRS might be cynical way to create a possibly large net gain for the government in tax revenues? Yes, I know the government pays subsidies, but I’m curious as to how the amount of subsidy payments stacks up to the potential fines if few actually sign up for insurance due to prohibitive cost despite the subsidies. With this administration, one cannot rule anything out.

    • Andrew Allison

      The reason for the premium increases is that only those who qualify for subsidies or are bad risks are signing up. Each time the premiums increase, the amount paid in subsidies increases and the number of people who sign up decreases; rinse and repeat — the “death spiral” is baked in. The amount of the subsidies paid dwarfs the revenue from the “fines”, payment of which, incidentally, is voluntary for those who don’t over-withhold.

  • Andrew Allison

    The increases only apply to those not receiving subsidies, which are based on MAGI not the premium amount. In other words, the Federal government, not the 87% of ACA participants who are receiving subsidies, will pay the increased premiums. More accurately, the Federal government will borrow the money to pay the premiums, thereby further increasing the deficit. Think Greece!

  • Blackbeard

    I think this is all going according to plan:

    1. Implement a horribly complicated new health care entitlement without any effective cost controls.
    2. Costs will predictably skyrocket.
    3. Blame greedy insurance companies.
    4. Implement single payer health insurance to “solve” the cost problem.

    This is where the left wanted to go all along.

    • Andrew Allison

      The truth is that health insurance is already largely single-payer. The Federal government (that means you and I) pays for Medicare, Medicaid, most of the ACA premiums and, via the tax deduction, about one-third of employer plans. Wouldn’t it make more sense to stop pretending otherwise? Given that Medicare has an overhead of 3% and ACA insurance companies are allowed 25%, single-payer would assuredly solve the insurance cost problem. The entirely separate health CARE cost problem is an entirely different kettle of fish.

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