August 16, 2022

The Unaffordable Care Act: Obamacare Drives Up Premiums Nationwide

Another day, another terrible headline for Obamacare. Under the banner “Lack aid? Many counties have only pricey plans,” USA Today repots:

More than half of the counties in 34 states using the federal health insurance exchange lack even a bronze plan that’s affordable — by the government’s own definition — for 40-year-old couples who make just a little too much for financial assistance, a USA TODAY analysis shows.

Many of these counties are in rural, less populous areas that already had limited choice and pricey plans, but many others are heavily populated, such as Bergen County, N.J., and Philadelphia and Milwaukee counties.

The USA TODAY analysis looked at whether premiums for the least expensive plan in any of the metal levels was more than 8% of household income. That’s similar to the affordability test used by the federal government to determine whether premiums are so expensive consumers aren’t required to buy plans under the Affordable Care Act.

The number of people who earn close to the subsidy cutoff and are priced out of affordable coverage may be a small slice of the estimated 4.4 million people buying their own insurance and ineligible for subsidies. But the analysis clearly shows how the sticker shock hitting many in the middle class, including the self-employed and early retirees, isn’t just a perception problem. The lack of counties with affordable plans means many middle-class people will either opt out of insurance or pay too much to buy it.

USA Today’s findings mirror those of The Heritage Foundation who conducted a similar county-by-county analysis of Obamacare’s impact on insurance markets earlier this year. Here it what Heritage found:

  • In the vast majority of states, the number of insurers competing in the state’s exchange is actually less than the number of carriers that previously sold individual market policies in the state.
  • At the local level, in over half of the 3,135 counties in the U.S., consumers will face an exchange market that is either a duopoly or monopoly. In 78 percent of U.S. counties, exchange enrollees will have a choice of coverage from three or fewer carriers.
  • The exchange market in over 94 percent of U.S. counties will feature competition among five or fewer companies. In Alabama, about 96 percent of that state’s counties will have only one insurer offering coverage in the exchange.

A recent Heritage study found that 42 of the 47 states for which comparable premium data is available will see significant average premium increases—in many cases, over 100 percent—for individuals purchasing from the exchanges.Competition has the ability to lower costs and improve quality, but Obamacare exchanges do not achieve this goal.

Considering how many millions of Americans will find health insurance “unaffordable” according to Obamacare’s own definition, expect the pressure for a full repeal or delay of the individual mandate to grow.