"Health insurance premiums will skyrocket!"
headlines blare and
Republicans bleat. Well, maybe. But chances are pretty good that, overall, no Obamacare insurance premiums aren't going to spike at all, and certainly not across the board. For example,
Avalere Health looked at proposed rate increases in eight states.
Specifically, premiums for silver plans will increase 5.8 percent on average across the states analyzed, ranging from a 12.0 percent average increase in Oregon to a 5.3 percent decrease in Michigan. More than two-thirds (68 percent) of 2015 exchange enrollees picked silver plans.
"While recent public attention has focused on a subset of plans that filed for premium increases of 10 percent or more, these data reveal that most plans are proposing more modest increases," said Caroline Pearson, senior vice president at Avalere. "Notably, final premiums could be even lower than those proposed." […]
"The good news for consumers in many states is that they may be able to keep premium increases low, depending on the plan they choose," said Elizabeth Carpenter, director at Avalere. "However, low-cost plan options in 2016 may not be from the same insurers who offered these plans in 2015. In these markets, consumers will need to balance continuity of care with lower monthly premiums when comparing their health insurance options."
While any premium increase isn't fun, 5.8 percent is hardly the
catastrophe Rep. Paul Ryan declaimed. Now, Avalere's analysis is just one among several, including
this from HealthPocket that looks at premiums for non-smoking 40-year-olds in large cities, and found a 14 percent increase for silver plans. That's not particularly great, but at the same time, it's a pretty narrow snapshot of the market. But the main point is that no, massive double-digit increases upward of 50 percent are not going to be the norm after all this shakes out.
The other thing to keep in mind is that this whole exercise of initial rate proposals could be blown all to hell by the Supreme Court. That uncertainty could be one of the reasons why insurers in some states proposed pretty massive increases—they want to give themselves room for those increases if disaster hits in the form of the Supreme Court wiping out subsidies in 34 states. We're not going to know what premiums will be for Obamacare for 2016 because the rates aren't finalized yet and because the challenge to Obamacare subsidies has thrown a massive monkey wrench into the whole system.