Another Broken Promise

Remember how ObamaCare was going to keep health insurance premiums from increasing more than a small percentage every year? The following was posted by a friend on Facebook:

ObamaCarePremiumsIt is not only time to repeal and replace ObamaCare, it is time to repeal and replace every Washington politician who has not repealed and replaced ObamaCare already!

I Guess Things Didn’t Go As Planned

ObamaCare is touted as one of the crowning achievements of the Obama Administration. Like some of the other achievements touted, the benefits are somewhat questionable. The two main promises of ObamaCare–if you like your healthcare plan, you can keep it, and if you like your doctor, you can keep him–have not really worked out as claimed. Now the claim that ObamaCare has cut the cost of health insurance seems to be in doubt as well.

Forbes Magazine posted an article on Thursday disputing the claims of Loren Adler and Paul Ginsburg of the Brookings Institution that health insurance premiums have decreased under ObamaCare. The authors cite a 2014 Brookings study that concluded premiums have increased.

The article reports:

While I will discuss the relevant evidence of the ACA’s effect on premiums in depth, there are three data points worth emphasizing. First, unlike Adler and Ginsburg’s approach, Brookings 2014 study used actual data and found that “enrollment-weighted premiums in the individual health insurance market increased by 24.4 percent beyond what they would have had they simply followed…trends.” Second, S&P Global Institute found that average individual market medical costs increased substantially between 2013 and 2015, up an estimated 69%. Third, 2014 insurer data shows that premiums for individual market Qualified Health Plans (QHPs), ACA-compliant plans certified to be sold on exchanges, were much higher than premiums for individual market non-QHPs, mostly plans in existence before 2014 that did not comply with the ACA. Relative to non-QHPs, insurers collected more than $1,000 per enrollee in higher premiums and more than $2,300 in higher premium revenue per enrollee in 2014 after accounting for large premium subsidy programs for their QHPs.

The article includes the following graph:

PMPM Chart - Mercatus

The data shows a huge increase in PMPM costs in the individual market between 2013 and 2015. According to S&P, PMPM costs increased 38% between 2013 and 2014, and another 23% between 2014 and 2015. The two-year increase (69%) is the product of the two single-year increases.

…It is worth noting that the individual market includes both ACA-compliant plans as well as non-ACA-compliant plans. If only ACA-compliant plans were included in the post-2013 data, the spike would likely be much larger.

I do wonder how much of this will be reported by the mainstream media. The fact that most people will experience this on a personal level means that the public will become aware of it.