Frustration mounting over health premiums
— Millions of people who buy individual health insurance policies and get no financial help from the Affordable Care Act are bracing for another year of double-digit premium increases, and their frustration is boiling over.
Some are expecting premiums for 2018 to rival a mortgage payment.
What they pay is tied to the price of coverage on the health insurance markets created by the Obama-era law, but these consumers get no protection from the law’s tax credits, which cushion against rising premiums. Instead they pay full freight and bear the brunt of market problems such as high costs and diminished competition.
On Capitol Hill, there’s a chance that upcoming bipartisan hearings by Sens. Lamar Alexander, R-Tenn., and Patty Murray, D-Wash., can produce legislation offering some relief. But it depends on Republicans and Democrats working together despite a seven-year health care battle that has left raw feelings on both sides.
The most exposed consumers tend to be middle-class people who don’t qualify for the law’s income-based subsidies. They include early retirees, skilled tradespeople, musicians, self-employed professionals, business owners, and people such as Sharon Thornton, whose small employer doesn’t provide health insurance.
“We’re caught in the middle-class loophole of no help,” said Thornton, a hairdresser in her 50s from Delaware. She said she’s currently paying $740 a month in premiums, and expects her monthly bill next year to be around $1,000, a 35 percent increase.
“It’s like buying two new iPads a month and throwing them in the trash,” said Thornton, whose policy carries a deductible of $6,000. “To me, $1,000 a month is my beach house that I wanted to have.”
If people such as Thornton drop out, they not only gamble with their own health. Their departure also means the group left behind gets costlier to cover as healthier customers bail out. That’s counter to the whole idea of insurance, which involves pooling risk.
It wasn’t supposed to be this way.
Buying health insurance has always been a challenge for people getting their own policies. Before “Obamacare,” insurers could turn away those with health problems or charge them more. Former President Obama sold his plan as the long-awaited fix.
It would guarantee coverage regardless of health problems, provide tax credits and other subsidies for people of modest means, and generate competition among insurers to keep premiums in check for all. The overhaul sought to create one big insurance pool in each state, no matter whether consumers bought plans through HealthCare.gov or traditional middlemen such as insurance brokers.
But an influx of sickerthan-expected customers drove up costs for insurers, while many younger, healthier people stayed on the sidelines. Political opposition from Republicans complicated matters by gumming up the law’s internal financial stabilizers for insurers.
The result was a 25 percent average increase in the price of a midlevel plan on HealthCare.gov heading into this year. Many states expect a similar scenario for 2018, but this time insurers say uncertainty about the Trump administration’s intentions is driving up their bids ahead of the Nov. 1 start of open enrollment.