Tuesday, 25 June, 2019

Obamacare premiums dip for first time. Some call it a correction

Gustavo Carr | 14 October, 2018, 10:57

Health insurance premiums in the 39 states that use HealthCare.gov - including CT - will fall 1.5 percent on average for the most commonly purchased plans in 2019, marking the first time that rates have dropped since the 2010 health care law was implemented. There were 10 states with only one insurer this year, but that number will drop to four in 2019. The drop-which is in double digits in some states-is the first of its kind since the health care law was implemented in 2010, reports Governing.

Tennessee will see the sharpest premium decline, as average monthly premiums for silver plans fell more than 26% from more than $600 a year ago to $449. The leveling-off comes two years after a huge spike in insurance premiums Arizona: Rates in 2017 jumped by 117 percent, a number Trump touted regularly to decry the ACA.

"The prediction was that the offering of short-term plans would have negative impact on the market and increase premiums, but we're not seeing the impact on the market", Verma said.

"The drop in benchmark plan premiums for plan year 2019 and the increased choices for Americans seeking insurance on the exchanges is proof positive that our actions are working", says CMS Administrator Seema Verma. The size of the decrease announced Tuesday is smaller than what HHS Secretary Alex Azar described in a speech last month in Nashville, where he predicted a 2 percent reduction in the average premiums in the most popular coverage: the second-lowest tier of "silver plans".

The premium rate drop was expected by those who watch the industry closely. On the other hand, some states had substantial increases: the average premium rose 20.2% in North Dakota, 16.1% in DE, and 12.5% in Hawaii.

It will cost a little less to buy the benchmark Affordable Care Act plan in 2019. For example, CMS has approved waivers in seven states - Wisconsin, Oregon, Alaska, Maine, Maryland, New Jersey, and Minnesota - allowing them to establish their own reinsurance programs for health insurers. Twenty-three more insurance companies are participating on HealthCare.gov in 2019 than in 2018, while 29 insurers are expanding.

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To recover the financial losses during the debut year of Affordable Care Act the insurers demanded for a big rate increase. Administration officials pointed to the new numbers as evidence that President Donald Trump is cleaning up the mess left behind by the Obama administration, and improving healthcare.

Projected premium decreases vary on a state-by-state basis, CMS said.

And while Verma called this year's premium decrease "dramatic" when compared to the last several years and categorized marketplace stabilization as "real progress", she maintained her position that the ACA is failing consumers. Still, the moderating prices for the most popular coverage will be helpful, in particular, to middle-class Americans - about 1 in 5 ACA customers - whose incomes place them above the threshold for the law's insurance subsidies. To prepare for that, and for just general chaos, insurers raised rates.

"However, this is by no means a celebration", she added.

"However, the Trump administration and Congress have also taken actions that have an upward effect on premiums", Cox tweeted.

While Republican-led repeal efforts failed past year, Trump has in the run-up to the November midterms continued touting alternatives to Obamacare as well as slamming Democratic proposals to expand Medicare. So far, the higher premiums haven't happened. That could lead healthy consumers to drop out of the exchanges and get skimpier coverage through those alternatives. Ongoing legal and Congressional actions may affect the law's future and that of the health care exchanges, particularly for people with preexisting conditions. "While some have publicly been accusing us of sabotage, we have been doing everything we can to mitigate problems of Obamacare". "I've gotten at least a call a day from some health care enrollment center that sounds like it might be part of the exchanges but is not", Fish-Parcham said.