Obamacare is driving up cost of health care
Health care is about to become more expensive. Insurers in Tennessee, Florida and Kentucky are raising premiums for plans offered through Obamacare’s exchanges. Insurers in other states will soon follow.
Insurers’ requests for rate hikes are an attempt to stay afloat amidst Obamacare’s sea of taxes and regulations. The blame for next year’s higher premiums lies squarely with the president’s health care law.
Across the country, regulators are green-lighting the enormous premium hikes insurance companies have requested.
In Tennessee, BlueCross BlueShield requested a 36 percent average premium hike. It was approved.
In Florida, regulators Ok’d an average rate increase of 9.5 percent for next year. Aetna’s average monthly premiums in the Sunshine State will rise 14 percent, to $381. BlueCross BlueShield’s average rate will jump 9 percent, to $472.
In all, 450 insurers around the country are requesting rate increases of 10 percent or more for 2016. Last year, “just” 151 did so — one-third as many.
REASONS FOR RATE HIKES
Obamacare requires insurers to offer coverage regardless of previous medical history and at prices that vary little across age groups.
These “guaranteed issue” and “community rating” regulations give the sick and elderly strong incentives to sign up for coverage. But they discourage the young and healthy from doing so. After all, why pay for expensive insurance that they probably won’t use?
As a result, sick enrollees — who are more costly to cover — make up a greater share of the insurance pool. To cover the cost of their care, insurers have no choice but to raise premiums for everyone.
NEW TAXES COMING DUE
Then there are Obamacare’s 18 new taxes and penalties. Consider the tax on health insurance premiums.
Over the next 10 years, the tax will extract $101.7 billion from insurers, who will simply pass the tab along to their customers. By one estimate, individuals purchasing insurance will have to fork over an additional $170 in monthly premiums.
Higher costs are already a reality. Take the example of Florida Healthy Kids, a health plan providing low-cost coverage for children. Thanks to Obamacare, premiums for many families will spike this month. Currently, 35,000 families pay $153 in monthly premiums per child. If they want to keep their existing coverage, they’ll have to pay as much as $299 a month — a 95 percent uptick.
“I assure you that we at FHK were as shocked and upset as each of you when we learned how much the coverage costs increased,” wrote Florida Healthy Kids CEO Rebecca Matthews in a letter to the affected families.
For many Americans, health care may soon be financially out of reach. Some may be able to search for less expensive plans, but in the process, they may lose their doctors and have fewer options for treatments and services.
Supporters of Obamacare might be surprised by this wave of premium hikes. But a clear-eyed look at the law’s many regulations and mandates would’ve signaled just such an outcome. Contrary to its promises, Obamacare is making health care less affordable.