Is Obamacare Causing Skyrocketing Premiums?

Not yet according to a recent commentary: BD Sommers. NEJM 2016; 375: 201-3. The graph below provides some perspective.  In addition, the author cautions those who have voiced early alarm bells regarding upcoming rates.  He notes the same alarms have been raised in the previous 2 years. Though, he notes, “there are reasons to suspect that marketplace premium growth for 2017 will exceed this year’s levels.  Two of the law’s provisions designed to reduce financial risk to insurers in the new markets expire after 2016 — the risk corridor and reinsurance provisions…the country’s continued emergence from the aftermath of the Great Recession may well spur increasing rates of health care inflation for the general population, as well as for the ACA exchanges”

“Premium growth — even when it does reach into the double-digit range that sparks such substantial media attention — is a policy challenge to be examined and addressed and is also part of the general historical pattern that precedes the ACA.”  Those who argue “the law as a whole should be scrapped ignore the devastating effect that repeal would have on the estimated 20 million Americans who have thus far gained insurance under the law.”

My take (from commentary): “Regardless of what ends up happening this year, it seems likely that next spring will bring renewed claims that the sky is falling — when experience should make clear that it isn’t.”

ACA premiums

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2 thoughts on “Is Obamacare Causing Skyrocketing Premiums?

  1. No question about it: premium growth for my individual policy here in the NYC area pre-ACA was outrageous. The huge drop in premiums after ACA was a relief, but in less than 10 years I expect basic coverage to again be so high that it will compel me to move to a more affordable market. If I could live here at the income level at which I would qualify for a subsidized exchange, I would. But not in my neighborhood. Southwest USA, get ready for another New Yorker to come on out!

  2. Pingback: Repealing the Affordable Care Act Without a Replacement | gutsandgrowth

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