Oba­macare cost pro­jected to rise faster than in­fla­tion

CBO sees en­roll­ment de­crease of 6 mil­lion

The Washington Times Daily - - FRONT PAGE - BY TOM HOW­ELL JR.

Oba­macare pre­mi­ums will rise an av­er­age of 5 per­cent a year over the next decade, much higher than the an­nual in­fla­tion rate, the gov­ern­ment’s chief score­keeper pre­dicted Thurs­day, say­ing that while the 2010 health care law is sta­ble, the gov­ern­ment will have to pump in more money per cus­tomer to keep it run­ning.

En­roll­ment is com­ing in far be­low pre­dic­tions. The Con­gres­sional Bud­get Of­fice now es­ti­mates that just 12 mil­lion cus­tomers will buy in­sur­ance on the ex­changes in 2027, down from the 18 mil­lion pro­jected last year.

Over­all, Oba­macare is cost­ing less than an­tic­i­pated, but that’s be­cause fewer peo­ple are en­rolling, the CBO said. When fig­ured on a per-en­rollee ba­sis, tax­pay­ers are shelling out more, pay­ing ever-higher sub­si­dies to help low- and mid­dle-in­come Amer­i­cans af­ford in­sur­ance.

Within a decade, each per­son get­ting sub­si­dized cov­er­age will cost the gov­ern­ment an av­er­age of $8,600, up from $5,550 this year.

Pre­mi­ums are spik­ing be­cause young and healthy cus­tomers didn’t sign up in large enough num­bers in

Oba­macare’s early rounds, leav­ing in­sur­ers with a sicker, costlier cus­tomer base. Some plans have re­quested dou­ble-digit in­creases for two years in a row, while oth­ers have dropped out al­to­gether.

Un­der Pres­i­dent Obama’s frame­work, tax­payer sub­si­dies rise with the cost of midtier “bench­mark” plans, ab­sorb­ing the cost for most con­sumers but forc­ing tax­pay­ers to pony up more for the pro­gram.

“It’s a sign of a poorly de­signed pro­gram, but I don’t think it rises to the at­ten­tion of the av­er­age tax­payer,” said Dou­glas Holtz-Eakin, pres­i­dent of the Amer­i­can Ac­tion Fo­rum and for­mer CBO di­rec­tor, who said big­ger driv­ers of spend­ing eclipse the dy­namic.

The CBO said the ad­min­is­tra­tion is mak­ing mat­ters worse by waf­fling on key de­ci­sions. Over­all, pre­mi­ums for bench­mark plans will rise 15 per­cent next year alone, though they will drop in 2019 if the ad­min­is­tra­tion can set­tle the mar­kets.

En­roll­ment is pre­dicted to rise slightly next year, from about 10 mil­lion to 11 mil­lion, damp­ened in part by Pres­i­dent Trump’s de­ci­sions.

“That in­crease in en­roll­ment in 2018 is limited by pro­jected pre­mium in­creases due to near-term mar­ket un­cer­tainty and by an­nounced re­duc­tions in fed­eral ad­ver­tis­ing, out­reach, the en­roll­ment pe­riod and other en­roll­ment ef­forts, which push en­roll­ment down,” an­a­lysts said, re­fer­ring to the Trump ad­min­is­tra­tion’s de­ci­sion to slash ad­ver­tis­ing and sign-up as­sis­tance by more than $100 mil­lion be­fore en­roll­ment sea­son be­gins Nov. 1.

Democrats held up that part of the re­port as ev­i­dence that Mr. Trump is try­ing to sab­o­tage his pre­de­ces­sor’s sig­na­ture do­mes­tic achieve­ment.

“By hin­der­ing Af­ford­able Care Act out­reach through fund­ing cuts and cre­at­ing un­cer­tainty in the mar­ket­place, Trump is caus­ing pre­mi­ums to in­crease and sti­fling en­roll­ment in 2018 and be­yond,” said Demo­cratic Na­tional Com­mit­tee spokes­woman Adri­enne Wat­son.

Democrats say Oba­macare is sta­bi­liz­ing af­ter a tu­mul­tuous start, with in­sur­ers rais­ing prices enough to break even or make a profit, and that pub­lic opin­ion is turn­ing in fa­vor of their 2010 sig­na­ture law.

Repub­li­cans, who now con­trol Congress, say en­roll­ment is stalling be­cause the pub­lic doesn’t like ex­pen­sive and overly pre­scrip­tive plans in the ex­changes.

Med­i­caid en­roll­ment will con­tinue to rise from 63 mil­lion this year to 70 mil­lion by 2027, with more states en­ticed into the Oba­macare ex­pan­sion.

Mr. Trump’s at­tempt to rally his Repub­li­can al­lies be­hind an Oba­macare re­peal bill fell short this year, open­ing the health care de­bate to a range of op­tions on Capi­tol Hill.

Four Se­nate Repub­li­cans are push­ing a last-ditch bill to re­place Oba­macare with block grants that em­power states.

“They will find so­lu­tions that work bet­ter for their state than the Af­ford­able Care Act,” said Sen. Bill Cas­sidy, Louisiana Repub­li­can.

From the left, a siz­able num­ber of Democrats are look­ing be­yond Oba­macare and push­ing a gov­ern­ment-run, sin­gle-payer pro­gram that they have dubbed “Medi­care for all” to cover ev­ery Amer­i­can.

Mean­while, a bi­par­ti­san crop of se­na­tors wants to strike a com­pro­mise that bol­sters the ex­ist­ing pro­gram, pony­ing up enough fed­eral money to prop up Oba­macare’s ex­changes — a win for Democrats — in re­turn for giv­ing states greater flex­i­bil­ity to shape their mar­kets.

“To get a re­sult, Repub­li­cans will have to agree to some­thing that many don’t want to agree to — ad­di­tional fund­ing through the Af­ford­able Care Act,” said Sen. La­mar Alexan­der, Ten­nessee Repub­li­can and chair­man of the Health, Ed­u­ca­tion, La­bor and Pen­sions Com­mit­tee. He wants to strike an agree­ment in the com­ing days so Congress can act be­fore the end of the month.

In­sur­ers must de­cide this month whether to par­tic­i­pate in the Oba­macare mar­ket­place for 2018.

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