Large Oba­macare hike a pock­et­book at­tack

Pre­mium spikes and in­surer scarcity spark fears of law’s demise

The Washington Times Weekly - - Politics - BY TOM HOW­ELL JR.

Oba­macare pre­mi­ums will soar in 2017, the ad­min­is­tra­tion ac­knowl­edged, with the price of the most pop­u­lar bench­mark plans jump­ing an av­er­age of 22 per­cent as the law con­tin­ues to rely on older, sicker cus­tomers than its back­ers had en­vi­sioned.

The num­ber of in­sur­ers of­fer­ing plans on the fed­er­ally run ex­change will also plum­met as com­pa­nies tap out, say­ing they can’t fig­ure out a way to make the eco­nom­ics work — and rais­ing the risk of lower com­pe­ti­tion and worse pre­mium in­creases.

Roughly one in five cus­tomers will have only a sin­gle in­surer as an op­tion next year after ma­jor play­ers such as Unit­edHealth Group and Aetna with­drew from most states and nearly all of Oba­macare’s co-op plans failed.

That’s par­tic­u­larly rough news for Pres­i­dent Obama, who is try­ing to boost his legacy in his fi­nal months in of­fice, and for Hil­lary Clin­ton, his would-be Demo­cratic suc­ces­sor, who has de­fended the law.

“This shows why the en­tire pro­gram must be re­pealed and re­placed,” said Ja­son Miller, a spokesman for Repub­li­can pres­i­den­tial nom­i­nee Don­ald Trump.

Con­gres­sional Repub­li­cans, strug­gling to main­tain their ma­jori­ties in both cham­bers, also seized on the news, warn­ing vot­ers that elect­ing Democrats would ce­ment the Af­ford­able Care Act into law.

Oba­macare cus­tomers — who at this time of year are also vot­ers — can get a first look next week at their own rates when they log onto the fed­eral Health­Care.gov web­site. Open en­roll­ment for 2017 be­gins Nov. 1.

The Health and Hu­man Ser­vices Depart­ment urged con­sumers to shop around to try to find the best deals and said 80 per­cent of cus­tomers won’t feel the full sticker shock be­cause they qual­ify for tax­payer-funded sub­si­dies.

HHS said nearly three-quar­ters of cus­tomers in 2017 will be able to find a plan for $75 or less per month after that tax cred­its kick in.

“I know that there has been much talk and dis­cus­sion about mar­ket­place rate in­creases this year. But head­line rate changes don’t ac­tu­ally re­flect what the vast ma­jor­ity of con­sumers will pay,” HHS Sec­re­tary Sylvia Mathews Bur­well has said about open en­roll­ment.

Yet sev­eral mil­lion cus­tomers do not qual­ify for gov­ern­ment sub­si­dies or pur­chase in­sur­ance off the ex­changes, so they will feel the full brunt of the in­creases.

Tax­pay­ers will also have to shell out more money to cover the sub­si­dies for those who do qual­ify — mean­ing Oba­macare’s costs will con­tinue to rise.

The House En­ergy and Com­merce Com­mit­tee asked the Cen­ters for Medi­care and Med­i­caid Ser­vices to de­tail just how much of a bur­den tax­pay­ers are shoul­der­ing.

“While the ad­min­is­tra­tion con­tin­ues to fo­cus on pre­mium ‘af­ford­abil­ity,’ it ig­nores the un­de­ni­able fact that fed­eral tax­pay­ers are sub­si­diz­ing th­ese pre­mium in­creases through tax cred­its,” wrote Rep. Fred Up­ton, Michi­gan Repub­li­can and the panel’s chair­man, along with other lead­ing mem­bers. “The com­mit­tee is con­cerned that the fed­eral tax­payer con­tin­ues to bear the bur­den of sub­si­diz­ing the grow­ing cost of health care in­sur­ance.”

An­a­lysts for months had warned of mas­sive pre­mium in­creases, say­ing the Oba­macare pro­gram is still strug­gling to en­tice healthy cus­tomers who are needed to make the eco­nom­ics work.

Min­nesota Gov. Mark Day­ton, a Demo­crat, re­cently said the law “is no longer af­ford­able for an in­creas­ing num­ber of peo­ple.” Ten­nessee In­sur­ance Com­mis­sioner Julie McPeak said the state’s Oba­macare ex­change is “very near col­lapse.”

“The fact that pre­mium in­creases in the ACA mar­ket­places are go­ing to be sub­stan­tially higher in 2017 has been known for months, so there’s no Oc­to­ber sur­prise here,” said Larry Le­vitt, a se­nior vice pres­i­dent at the non­par­ti­san Kaiser Fam­ily Foun­da­tion. “The start of open en­roll­ment just means that th­ese in­creases are be­com­ing more tan­gi­ble for those con­sumers who are af­fected.”

In­creases will vary widely from place to place, though some of the fig­ures are eye-pop­ping: In Ari­zona, a 27-year-old’s av­er­age monthly pre­mium for the sec­ond­low­est sil­ver, or “bench­mark,” plan jumps $196 to $422, a 116 per­cent in­crease, be­fore sub­si­dies.

In Ok­la­homa, that same cus­tomer would get a 69 per­cent in­crease. Cus­tomers in In­di­ana and Mas­sachusetts, which runs its own ex­change, would be the only ones to see a de­crease, of 3 per­cent, ac­cord­ing to the HHS re­port.

The ad­min­is­tra­tion said things could get worse if the fed­eral courts do not over­turn a judge’s de­ci­sion in May that sided with House Repub­li­cans, who say the Trea­sury is un­law­fully re­im­burs­ing in­sur­ers for losses un­der the 2010 health care over­haul.

In court pa­pers last Mon­day, the Jus­tice Depart­ment said Repub­li­cans shouldn’t have been al­lowed to sue over the cost­shar­ing pro­gram, which is de­signed to pay back in­sur­ers who must help poorer en­rollees with out-of-pocket ex­penses.

Mil­lions of Oba­macare cus­tomers with in­comes from 100 per­cent to 250 per­cent of the poverty line rely on the pay­ments, and health care plans are re­quired to re­duce their out-of-pocket costs, whether they are re­im­bursed or not.

AS­SO­CI­ATED PRESS

Health and Hu­man Ser­vice Sec­re­tary Sylvia Mathews Bur­well says the ma­jor­ity of health care con­sumers won’t have to pay “head­line rate changes.”

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