After surviving the Supreme Court challenge, President Obama’s signature healthcare law is likely headed for new depths of unpopularity. The so-called Affordable Care Act is about to get much less affordable for many Americans, with insurance companies looking to increase rates substantially next year. Many companies are applying for increases that exceed 20 percent. Some are topping out over 50 percent. And while the final decision lies with state regulators, the writing is on the wall.
According to the health insurance companies, their clients are much sicker than they expected. This is leading many of them to go back through the books and rearrange their rates so they can continue to make a profit. In at least one state – Oregon – rate increases of up to 33 percent have already been approved by the insurance commissioner. “Some may start wondering if insurance is affordable or if it’s worth the money,” said Jesse Ellis O’Brien, an Oregon health advocate.
Defending his law, President Obama said last week that it was up to the public to pressure state regulators to make sure these rate increases are necessary. “My expectation,” he said, “is that they’ll come in significantly lower than what’s being requested.”
He’s probably right, but that’s a stop-gap measure at best. It’s only good business for insurance companies to shoot for the moon and come back down to a negotiated middle ground. But what about next year? What about the year after that? Is there any doubt that the rates are going to skyrocket over the next five years? Someone who can just barely afford 2016’s premiums is going to be shut out of the system by 2017.
According to several studies, consumers have a chance at maintaining a decent premium if they are willing to switch plans and sometimes providers. But in many cases, this will also mean they will have to switch doctors or go without the services they currently enjoy. It’s a no-win situation. In the best case scenario, consumers will have to prepare to switch policies every November in an unending game of cat and mouse. Is that really what Obamacare has left us with?
Look, it’s impossible to drum up much sympathy for the struggling health insurance companies. But this isn’t about whether Blue Cross is making a satisfying profit. This is about what happens when the federal government gets too involved in the private marketplace. This is a federally subsidized program that can’t meet its creators’ expectations. How much longer will we support it before we decide we’re throwing good money after bad?