Alabama sees America’s highest premium spike under Obamacare
A new report from the Department of Health and Human Services (HHS) details the premium changes Americans across the country have experienced under former President Barack Obama‘s signature legislation, Affordable Care Act, better known as Obamacare. According to the report, which uses the data the Obama administration relied on, “average exchange premiums were 105 percent higher in the 39 states using Healthcare.gov in 2017 than average individual market premiums in 2013.” “Premiums for individual market coverage have increased significantly since the Affordable Care Act’s key provisions have taken effect,” the new report reads. The report also found the State of Alabama saw the nation’s highest premium increase since the implementation of Obamacare with an average 223 percent increase between 2013 and 2017 due to the new regulations. That’s more than double the national average. Alabama 2nd District U.S. Rep. Martha Roby said the statistics show why Republicans are working to offer Americans relief from the burdensome law. “The numbers are staggering. Insurance premiums and deductibles have skyrocketed due to the regulations and mandates imposed by Obamacare,” Roby said. “Providers have been forced out of the market, and Alabama consumers now only have one option for health insurance. Problems like these are why I worked to help build support for our three-step plan to repeal and replace Obamacare.” Earlier this month the U.S. House of Representatives passed the American Health Care Act (AHCA), which is the first of a three-phase plan by Republicans in Congress and the Trump Administration to repeal and replace Obamacare and rebuild America’s health care system, based on a plan that is intended to lower premiums and other out-of-pocket costs that have come to weigh on patients.
Rise in premiums lays bare 2 Americas on health care
Michael Schwarz is a self-employed business owner who buys his own health insurance. Subsidized coverage through “Obamacare” offers protection from life’s unpredictable changes and freedom to pursue his vocation, he says. Brett Dorsch is also self-employed and buys his own health insurance. But he gets no financial break from the Affordable Care Act. “To me, it’s just been a big lie,” Dorsch says, forcing him to pay more for less coverage. Schwarz and Dorsch represent two Americas, pulling farther apart over former President Barack Obama‘s health care law. Known as the ACA, the law rewrote the rules for people buying their own health insurance, creating winners and losers. Those with financial subsidies now fear being harmed by President Donald Trump and Republicans intent on repealing and replacing the ACA. But other consumers who also buy their own insurance and don’t qualify for financial help feel short-changed by Obama’s law. They’re hoping repeal will mean relief from rising premiums. The ACA sought to create one big new market for individual health insurance in each state. It required insurers to accept all customers, regardless of medical problems. And it provided subsidies to help low- and moderate-income people afford premiums. These newly vested ACA customers joined consumers already in the market, to make a new insurance pool. Policies offered to all had to be upgraded to meet new federal standards for comprehensive benefits, raising premiums. And many of the new customers turned out to be sicker than insurers expected, pushing rates even higher. Consumers who didn’t qualify for government financial help wound up bearing the full cost of premiums. They also faced the law’s new requirement to carry health insurance or risk fines. “One (group) is angry and one is incredibly grateful,” said Robert Blendon of the Harvard T.H. Chan School of Public Health. If Trump and congressional Republicans aren’t careful, their actions could stoke fresh grievances without solving longstanding problems of access and cost. Consider what happened to Schwarz and Dorsch this year, as premiums for a standard plan through HealthCare.gov jumped an average of 25 percent. Schwarz and his wife are in their mid-20s and live in Tampa, Florida. He has his own commercial photography business and she’s pursuing a graduate degree in speech-language pathology. The sticker price of their HealthCare.gov policy went up about 20 percent, but what they pay monthly is about $115 lower than last year. Not only did their subsidy cover the rise in premium, they’re also getting more help because their income went down when Schwarz’s wife returned to school full time. “Being uninsured is not an option,” said Schwarz. If Republicans take away his subsidy, “I would have to change careers and find a job that offered health insurance,” he said. Dorsch and his wife live in Wilmington, Delaware, and are in their mid-50s. He has a wholesale business supplying electronics to retail stores and has been buying his own health insurance for years. He gets no financial help from the ACA. Dorsch said their insurance company wanted to raise the monthly premium to $2,050, or nearly $25,000 a year. They settled for a skimpier plan that still costs $1,350 a month and has a very high deductible. “In four years my health insurance has more than doubled and I have less coverage,” said Dorsch. “It’s ludicrous.” He voted for Trump. “He saw the reality that Obamacare has been a nightmare for most Americans, unless you are poor or in a very difficult situation,” said Dorsch. The Congressional Budget Office estimates that the pool of people buying individual health insurance is basically split down the middle among subsidized customers like Schwarz and those who get no help, like Dorsch. Republican proposals to tie tax credits to age, not income, would help Dorsch. But they may not be generous enough for Schwarz. “It’s trying to find the way to help the one without hurting the other that’s really tricky,” said Nicholas Moriello, a health insurance broker from Newark, Delaware. “If we had a way to help the person whose premium has become unaffordable without hurting the person we are currently subsidizing.” Caroline Pearson, of the consulting firm Avalere Health, studied consumers on government marketplaces like HealthCare.gov — where nearly 90 percent get subsidies — and compared them with those who purchase directly from an insurer and pay full cost. Among Avalere’s findings: — The majority of consumers in the government marketplaces live in lower-income neighborhoods with high unemployment. However, among those who purchase directly from an insurer, about 30 percent live neighborhoods with a median income of $100,000 or more. — Consumers in the subsidized market are generally costlier to cover. For those with a standard plan, per-person medical claims averaged $376 per month in 2015, compared to $312 for unsubsidized customers who bought policies directly from an insurer. — The subsidized market is important in states that voted for Trump. In Florida, for example, 70 percent of individual policyholders purchase through HealthCare.gov. In Georgia, it’s 62 percent. “Obamacare helped a lot of lower-income people with high health needs who previously couldn’t afford insurance,” said Pearson. “It overlooked the fact that there are a lot of people who are relatively healthy and who didn’t want the increased benefits. More sick people drove up premiums, which is resulting in some people feeling like they are worse off.” Republished with permission of The Associated Press.
Bradley Byrne: Nothing affordable about the ‘Affordable Care Act’
In 2008, then Sen. Barack Obama famously said, “In an Obama administration, we will lower premiums by up to $2,500 for a typical family per year.” You don’t have to be a health insurance expert to know that was a lie. All around the First District of Alabama, I talk to folks who are hurting because of the burdensome cost of health insurance under Obamacare. Perhaps Bill Clinton put it best, “You’ve got this crazy system … people are out there busting it, sometimes 60 hours a week, wind up with their premiums doubled and their coverage cut in half. It’s the craziest thing in the world.” Unfortunately, things are only getting worse. This week, 2017 premium rates were released for the Obamacare exchanges. Across the country, enrollees will see a shocking average premium increase of 25.6 percent. But, this is only the average of all exchanges. For Alabamians, rates will increase a whopping average of 58 percent. The Obama administration was quick to say this will not affect most people on the exchanges because, under Obamacare, as premiums increase, so does the share of the premium the government picks up. It is as if these folks do not realize where the government gets the money to pay for these premiums — from the taxpayers. In 2016, taxpayers subsidized the exchanges to the tune of $42 billion. Already, these subsidies were expected to jump to $106 billion by 2026 and a 25 percent increase in premiums is likely to add at least $8 billion to the taxpayer’s bill for just 2017. More importantly, the Obama administration doesn’t account for the millions of people who receive no subsidy because their family income is 400 percent above the federal poverty line. With that in mind, I decided to log into the Alabama exchange to see what I could find. I selected a family of four with parents in their mid-30s, two young children, that do not smoke. Without a subsidy, the cheapest plan on the exchange for Mobile County carried a premium of $982.45 a month with a deductible of $12,900 a year! So, under Obamacare, two middle-class parents would have to pay $24,689.40 a year just to be able to use their health insurance. Of course, Obamacare’s problems aren’t just being felt by those using the exchange. Traveling around the district, I hear from employers and employees alike that healthcare costs are skyrocketing. Most of us remember when, not too long ago, you could go to the doctor or pick up a prescription on your company’s sponsored insurance and pay only a small copayment. Today, Obamacare’s mandates and red tape prevent employers and insurance companies from offering the type of plans we were accustomed to just a few years ago. For those lucky enough to have employer-sponsored insurance, there is often a huge deductible to be paid. Of course, Republicans were sounding the alarm about these costs before Obamacare was passed. Unfortunately, Nancy Pelosi and Harry Reid chose to ram the bill through Congress without Republican support. Since my first day in Congress, I have said Obamacare is a complete disaster. These premium hikes only prove what Republicans have been saying for years, the entire bill must be repealed and replaced. As your congressman, cleaning up the mess known as Obamacare will remain one of my top priorities for the next Congress. • • • Bradley Byrne is a member of U.S. Congress representing Alabama’s 1st Congressional District.
Barack Obama administration confirms double-digit premium hikes
Premiums will go up sharply next year under President Barack Obama‘s health care law, and many consumers will be down to just one insurer, the administration confirmed Monday. That’s sure to stoke another “Obamacare” controversy days before a presidential election. Before taxpayer-provided subsidies, premiums for a midlevel benchmark plan will increase an average of 25 percent across the 39 states served by the federally run online market, according to a report from the Department of Health and Human Services. Some states will see much bigger jumps, others less. Moreover, about 1 in 5 consumers will have plans only from a single insurer to pick from, after major national carriers such as UnitedHealth Group, Humana and Aetna scaled back their roles. “Consumers will be faced this year with not only big premium increases but also with a declining number of insurers participating, and that will lead to a tumultuous open enrollment period,” said Larry Levitt, who tracks the health care law for the nonpartisan Kaiser Family Foundation. Republicans pounced on the numbers as a warning that insurance markets created by the 2010 health overhaul are teetering toward a “death spiral.” Sign-up season starts Nov. 1, about a week before national elections in which the GOP remains committed to a full repeal. “It’s over for Obamacare,” Republican presidential candidate Donald Trump said at a campaign rally Monday evening in Tampa, Florida. Trump said his Democratic rival, Hillary Clinton, “wants to double down and make it more expensive and it’s not gonna work. … Our country can’t afford it, you can’t afford it.” He promised his own plan would deliver “great health care at a fraction of the cost.” The new numbers aren’t too surprising, said Sen. Orrin Hatch, R-Utah, who chairs a committee that oversees the law. It “does little to dispel the notion we are seeing the law implode at the expense of middle-class families.” HHS essentially confirmed state-by-state reports that have been coming in for months. Window shopping for plans and premiums is already available through HealthCare.gov. Administration officials are stressing that subsidies provided under the law, which are designed to rise alongside premiums, will insulate most customers from sticker shock. They add that consumers who are willing to switch to cheaper plans will still be able to find bargains. “Headline rates are generally rising faster than in previous years,” acknowledged HHS spokesman Kevin Griffis. But he added that for most consumers, “headline rates are not what they pay.” The vast majority of the more than 10 million customers who purchase through HealthCare.gov and its state-run counterparts do receive generous financial assistance. “Enrollment is concentrated among very low-income individuals who receive significant government subsidies to reduce premiums and cost-sharing,” said Caroline Pearson of the consulting firm Avalere Health But an estimated 5 million to 7 million people are either not eligible for the income-based assistance, or they buy individual policies outside of the health law’s markets, where the subsidies are not available. The administration is urging the latter group to check out HealthCare.gov. The spike in premiums generally does not affect the employer-provided plans that cover most workers and their families. In some states, the premium increases are striking. In Arizona, unsubsidized premiums for a hypothetical 27-year-old buying a benchmark “second-lowest cost silver plan” will jump by 116 percent, from $196 to $422, according to the administration report. But HHS said if that hypothetical consumer has a fairly modest income, making $25,000 a year, the subsidies would cover $280 of the new premium, and the consumer would pay $142. Caveat: if the consumer is making $30,000 or $40,000, his or her subsidy would be significantly lower. Dwindling choice is another issue. The total number of HealthCare.gov insurers will drop from 232 this year to 167 in 2017, a loss of 28 percent. (Insurers are counted multiple times if they offer coverage in more than one state. So Aetna, for example, would count once in each state that it participated in.) Switching insurers may not be simple for patients with chronic conditions. While many carriers are offering a choice of plan designs, most use a single prescription formulary and physician network across all their products, explained Pearson. “So, enrollees may need to change doctors or drugs when they switch insurers,” she said. Overall, it’s shaping up to be the most difficult sign-up season since HealthCare.gov launched in 2013 and the computer system froze up. Enrollment has been lower than initially projected, and insurers say patients turned out to be sicker than expected. Moreover, a complex internal system to help stabilize premiums has not worked as hoped for. Nonetheless, Obama says the underlying structure of the law is sound, and current problems are only “growing pains.” The president has called for a government-sponsored “public option” insurance plan to compete with private companies. Republicans, including Trump, are united in calling for complete repeal, but they have not spelled out how they would address the problems of the uninsured. Clinton has proposed an array of fixes, including sweetening the law’s subsidies and allowing more people to qualify for financial assistance. The law makes carrying health insurance a legal obligation for most people, and prohibits insurers from turning away the sick. It offers subsidized private plans to people who don’t have coverage through their jobs, along with a state option to expand Medicaid for low-income people. Largely as a result, the nation’s uninsured rate has dropped below 9 percent, a historically low level. More than 21 million people have gained coverage since the Affordable Care Act passed in 2010. Republished with permission of the Associated Press.
