Obamacare may slow insurance rate hikes

Nonpartisan industry watchers say they expect big premium increases to hit less frequently in years to come
Associated Press
May 27, 2014

 

The wild hikes in health insurance rates that blindsided many Americans in recent years may become less frequent because of the health care overhaul.

Final rates for 2015 won't be out for months, but early filings from insurers suggest price increases of 10 percent or more. That may sound like a lot, but rates have risen as much as 20 or 30 percent in recent years.

The rates that emerge over the next few months for 2015 will carry considerable political weight, since they will come out before Republicans and Democrats settle their fight for Congressional control in next fall's midterm elections. Republicans are vowing to make failures of the law a main theme of their election push, and abnormally high premiums might bolster their argument.

In addition to insuring millions of uninsured people, the other great promise of the massive health care overhaul was to tame the rate hikes that had become commonplace in the market for individual insurance coverage.

No one expects price increases to go away, but some nonpartisan industry watchers say they do expect the big hikes to hit less frequently in the years to come, even though it's still early in the law's implementation. They point to competition and greater scrutiny fostered by the law as key factors.

Public insurance exchanges that debuted last fall and were created by the law make it easier for customers to compare prices. The overhaul also prevents insurers from rejecting customers because of their health.

That means someone who develops a health condition like high blood pressure isn't stuck in the same plan year after year because other insurers won't take her. She can now shop around.

The Urban Institute, a nonpartisan policy research organization, said in a recent report that competition will help restrain individual insurance prices next year.

And it could have a lasting impact once the new markets for coverage stabilize in a few years, said Larry Levitt, an insurance expert with the Kaiser Family Foundation, which analyzes health policy issues.

"Now if a plan tries to raise premiums a lot, people can vote with their feet and move to another plan," Levitt said.

Greater scrutiny by regulators could also keep rates from skyrocketing. The overhaul requires a mandatory review of rate increases larger than 10 percent, which can lead to public attention that insurers don't want.

"Nobody's going to get a rate increase unless they truly deserve it," said Dave Axene, a fellow of the Society of Actuaries, who is working with insurers in several states to figure out pricing. "The rigor that we had to go through to prove that the rates were reasonable, it's worse than an IRS audit at times."

To be sure, insurers and others in the field say it's too early to fully understand what pricing trends will emerge for individual insurance plans, which make up a small slice of the insured population. And some experts aren't convinced of any one outcome of the law.

Industry consultant Bob Laszewski called the idea that the exchanges will reign in prices by promoting competition an "unproven theory."

"No one has any idea what this risk really looks like yet and probably won't for two to three years," he said.

Karen Ignagni agrees. The CEO of the trade association America's Health Insurance Plans, which represents insurers, said competition between insurers will mean little if too many sick people sign up for coverage on the exchanges. Insurers need a balance between sick and healthy people to avoid big claim hits that lead to future rate hikes.

Laszewski expects some plans to seek either big premium increases or decreases in 2015, but he says that says nothing about the long-term implications of the overhaul. He noted that insurers entered 2014 without a good feel for what their competitors would charge, so price swings are inevitable as companies adjust.

Charmaine Piquette, 60, said she's "petrified" of a big increase for next year. "I finally feel like in my life I have a break and can afford to take care of myself even though I'm not living on very much a month," said Piquette, who lives outside Milwaukee.

Piquette used Wisconsin's public health insurance exchange in March to get coverage from the nonprofit insurance cooperative Common Ground. The plan costs her only about $177 a month thanks to a $500 tax credit she receives as part of the overhaul.

She lives mainly on about $1,200 a month in Social Security disability payments, but her health coverage helps her afford things like visits with a diabetes counselor to get her blood sugar back under control.

"I said, 'Praise the Lord' every single time I use this," she said.

 

Comments

Contango

Re: "some nonpartisan industry watchers say they do expect the big hikes to hit less frequently in the years to come, even though it's still early in the law's implementation."

"Less frequently," "still early," in other words: Mishegas.

There you go again

I thought families were "promised" to save $2500 per year-not price increases.

freespeech1

The New York Times, which broke the story, reports:

When employers provide coverage, their contributions, averaging more than $5,000 a year per employee, are not counted as taxable income to workers. But the Internal Revenue Service said employers could not meet their obligations under the health care law by simply reimbursing employees for some or all of their premium costs.

The IRS ruling is an effort by the Obama administration to stop employers with 50 or more workers from doing what critics of the health law said they would do: pay a penalty for not providing insurance and dump workers into the unpopular Obamacare program.

With the Nov. 4 midterm elections looming, the Obama administration could not allow massive waves of employer cancellations before Democrats face an already angry electorate. So the IRS ruled it would slap any employer with a $100 tax penalty per day per worker that used tax-exempt health insurance monies to cut workers a lump check and dump them on the Obamacare exchanges.

The new IRS rule comes on the heels of the Obama administration's announcement that it will bail out insurers which participate in the Obamacare program which lose cash. As the Times notes, "Administration officials hope the payments will stabilize premiums and prevent rate increases that could embarrass Democrats in this year’s midterm elections."

yeah obamacare is a good thing LMAO, comply or the IRS will be there to destroy you

Contango

"Report: FBI Launches Preliminary Investigation Into Oregon’s Failed Obamacare Exchange":

http://seattle.cbslocal.com/2014...

$250M and not one sign up?

Obamacare causing a slowdown in healthcare premiums?

More like typical Bolshevik Party propaganda, i.e., smoke and mirrors.

deertracker

Your point with that link? We all know you read pooh!

JACKEL

At least he can read ! One of the reasons the rates will slow, is because of The Old folks croaking. What do you think, someone made up that story. Of course you wouldn't read it being a member of Non Christian, Non Constitutional, Non American Party !

The Big Dog's back

He doesn't belong to the right wingnut party.

freespeech1

They don't make a bus short enough for you

JACKEL

The DNC claimed to be The Party Of The People and all our welcome ,unless you are a Gun Totin ,Christian Redneck. I am proud to be all those things. So The Right wing is a Gun Totin Christian
Party. We do not condone live birth abortions like you murderers !

jazzbo

Republicans like killing older humans.

freespeech1

Please give some factual evidence for your ridiculous statement. That being said, you seen what gov healthcare is like now since the VA scandal broke,and the lack of urgency from the liar and chief. This is the future of healthcare in the US. If you think otherwise your a fool. The scariest part is that 85% of VA employees are union, and we all know what kinda damage they can do to anything they get their grubby little hands on.

deertracker

Father time is undefeated Jackel!

AJ Oliver

If it were not for decades of sabotage by the right and the insurance companies, we would have had affordable health care for all long ago - like so many countries do. States that refuse to expand Medicaid are committing murder plain and simple. People need to be able to buy into any existing plan - that of Congress, Medicare, VA, whatever.
And the rightists' plan for health care reform is . . . is . . . (Crickets) . .they don't have one.

jazzbo

Exactly.

Contango

Re: "rightists' plan for health care reform"

A combination of high deductible health plans (HDHP) and health savings accounts (HSA) have work well for my spouse and myself for yrs.

Pres. Bush sought to expand them, the Dems quashed it.

Dr. Benjamin Carson is the latest proponent:

http://www.freep.com/article/201...

The Big Dog's back

free republic? You've sunk to an all time low.

Contango

ROFLMAO!!!

Detroit Free Press, putz.

Contango

Re: "expand Medicaid"

Medicare and Medicaid are subject to waste, fraud and abuse in the amt. of an estimated $60-100B annually.

The typical Bolshevik response:

Just hire more highly compensated govt. bureaucrats to oversee the system and 'fix' the problem.

Whatever the problem with govt., more of it is the Bolshevik answer.

The Big Dog's back

High deductible is not an alternative unless your employer is putting money into a HSA.

Contango

Re: "High deductible,"

Many Obamacare sign-ups went for the cheapest premium - high deductible.

Where are they gonna get the money to pay for the deductible?

Sticker shock!

http://finance.yahoo.com/news/ob...

doglegright

The whole reason for the "wild hikes" in the first place was Obamacare. Now this article acts as if Obamacare will be the solution because of "healthcare overhaul" bbbbwaaaaaahhhhaaaa!!!!

Contango

FYI:

The modern health and welfare state was first enacted under Prussian authoritarian and autocrat Otto von Bismarck.

http://en.wikipedia.org/wiki/Ott...

Little wonder that socialists prefer heavy-handed govt. control to the use of the free mkt.

coasterfan

Life inside the Fox Bubble. Even when a non-partisan group says the law is working, they don't allow any new information/facts/ statistics to get in the way of their partisan misinformation campaign.

deertracker

Agreed!

KnuckleDragger

^as usual, when unable to win an argument by presenting facts pull out one of three replies, 1) Fox News, 2) It must be Bush's fault, 3) throw out the race card. Proving with each response that you are an idiot!

AJ Oliver

So now Canada is not only totalitarian, but Bolshevik too? What a sense of humor !!

KnuckleDragger

Private hospitals along our nations border with Canada absolutely love Canada's health care system. Good 'ole American private healthcare is making billions off of Canada's failure.

Contango

Re: "Canada,"

"Canada ranked last among OECD countries in health care wait times,"

http://www.ctvnews.ca/health/can...

Yea, looks like a good model for U.S. single-payer. :)

Dr. Information

"may" is a word that does not mean for certain. Of course you left wingnuts can't figure that out. You will polish this turd until your hands are brown.

looking around

"Piquette used Wisconsin's public health insurance exchange in March to get coverage from the nonprofit insurance cooperative Common Ground. The plan costs her only about $177 a month thanks to a $500 tax credit she receives as part of the overhaul.

She lives mainly on about $1,200 a month in Social Security disability payments, but her health coverage helps her afford things like visits with a diabetes counselor to get her blood sugar back under control.

"I said, 'Praise the Lord' every single time I use this," she said."

I hear this more and more frequently in my travels. It seems to me that for those that are taking advantage of the Affordable Health Care Act and seeking insurance through the exchanges appear to be very grateful to have it and it seems to be working.

KnuckleDragger

I bet they do, especially the ones who are getting it paid for on the backs of the middle class. Piquette I'm sure loves it since it leaves more money available for her to spend on such things as food...the reason she probably has diabetes and is receiving a disability payment. Welcome to America, where you can gorge yourself to the point of weighing 500 lbs and the rest of us will pick up the tab for the resulting health problems and the food necessary to maintain the weight. Absolutely disgusting.

The Big Dog's back

You right wingnuts are getting nuttier by the minute.

freespeech1

And you will always be ignorant

JACKEL

Hey doggie ,get a new line !

deertracker

You mean nuttier by the second!

looking around

You better learn something about diabetes before opening your pie hole! I know many people with diabetes problems that are skinny as a rail. Second what makes you think this woman weighs 500# besides your pathetic sense of what is the root cause of the problems someone else may be afflicted with?

"Charmaine Piquette, 60, said she's "petrified" of a big increase for next year. "I finally feel like in my life I have a break and can afford to take care of myself even though I'm not living on very much a month," said Piquette, who lives outside Milwaukee."

I'd like to see you try to live on $1,200 dollars a month, you probably would like to see many more trying to make ends meet on that income, after all isn't that what's holding the price down on everything you need? Sure if they made more the price on everything would just escalate out of control.....right? The only thing I see absolutely disgusting is your rhetoric and lack of compassion for others.

deertracker

GI Joe is just pitiful. Don't waste your time on clowns!

AJ Oliver

I feel sorry for some of the right wing folks who post here. It can't be much fun living inside a skin with seething anger and resentment and contempt for one's neighbors. No fun at all . . .

Donegan

I feel sorry for you as well. Being that disillusioned and ignorant of the facts must be bliss for you but it would be heck for me.
If you really want to see seething anger and resentment it is not hard to do. Just present a Democrat with a fact or two and watch their "tolerance" kick in.

Maggdi

What? Oh no!
You din'int!?....

Donegan

Hi Big Dog. Might as pick one name or the other.

deertracker

The dummygan speaks!

Contango

Re: "resentment and contempt for one's neighbors,"

More like the thieving redistributionist kleptocrats and those useful idiots that support them.

Not part of the 1-3% Sport? Be careful what you wish for.

anthras

Because of Obamacare many persons were placed in medicaid paid for by the tax payers. Piquette is receiving a $500 tax credit thanks to the tax payers and the insurance companies are receiving government bail outs thanks to the tax payers. For claim cost that are 3 to 8 percent higher than the amount paid in premiums, the federal government will reimburse half that amount. For costs that exceed 8 percent insurer will be reimbursed 80 percent.

With the tax credits to the insureds to lower the premium cost and the money paid to the insurance companies the premiums should not rise fast.

But the bottom line is that the tax payers will pay to keep the premiums lower. The government will give you anything you want using your money!

Contango

Re: "The government will give you anything you want using your money!"

But, the public bureaucrats need to be richly compensated for their 'heart-felt' efforts.

Reminds me:

"The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money."

- Alexis de Tocqueville (1805-1859)

Pterocarya frax...

Not only is that quote a fake, you are a fake because I have called you out on it before, and provided links to prove it.

Article 1, Section 8 of your beloved Constitution starts:

"The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defense and general Welfare of the United States..."

And in the Preamble of the Constitution:

"We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare"

Those quotes blow apart the concept of the fake Tocqueville quote. Not only that, perhaps you should actually read Tocqueville's book, "On Democracy in America". He was quite impressed with "the general equality of condition among the people".

Maggdi

Not your Constitution?

The Hero Zone's picture
The Hero Zone

If you're willing to discuss it, Pter, I'll counter what you wrote with the following:

http://www.lawandliberty.org/gen...

General Welfare

The “general welfare” clause is mentioned twice in the U.S. Constitution: first, in the preamble and second, it is found in Article 1, Section 8.

The preamble reads: “WE THE PEOPLE of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.”

Article 1, Section 8 of the Constitution refers to the “general welfare” thus: “The Congress shall have the Power to lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common defense and general welfare of the United States. . .”

The preamble clearly defines the two major functions of government: (1) ensuring justice, personal freedom, and a free society where individuals are protected from domestic lawbreakers and criminals, and; (2) protecting the people of the United States from foreign aggressors.

When the Founding Fathers said that “WE THE PEOPLE” established the Constitution to “promote the general Welfare,” they did not mean the federal government would have the power to aid education, build roads, and subsidize business. Likewise, Article 1, Section 8 did not give Congress the right to use tax money for whatever social and economic programs Congress might think would be good for the “general welfare.”

James Madison stated that the “general welfare” clause was not intended to give Congress an open hand “to exercise every power which may be alleged to be necessary for the common defense or general welfare.” If by the “general welfare,” the Founding Fathers had meant any and all social, economic, or educational programs Congress wanted to create, there would have been no reason to list specific powers of Congress such as establishing courts and maintaining the armed forces. Those powers would simply have been included in one all-encompassing phrase, to “promote the general welfare.”

(There's more, but not much and it's behind the link.)

Followed up, the concept of welfare as a social program wasn't mentioned until after the Constitution was written and not cemented in notions of government until the New Deal, even further away from the Constitution's writing. So, a word was adapted and repeated to the point where it is expected to be retroactively applied to something it was NEVER meant to do. That's selective language use and a perversion of the language that continually slips into our culture from a certain city on the Potomac.

http://dictionary.reference.com/...

Word Origin & History

welfare
O.E. wel faran "condition of being or doing well," from wel (see well (adv.)) + faran "get along" (see fare (v.)). Cf. O.N. velferð. Meaning "social concern for the well-being of children, the unemployed, etc." is first attested 1904. Welfare state is recorded from 1941.

Also, kudos for the Tocqueville nod. However the quote you provided does not mean the government must provide entitlements to people. Or rather instead of entitlements let's call it "equality of outcome". Tocqueville was imprssed by the OPPORTUNITY that was provided that those born into abject poverty had the ability to achieve much in their life as opposed to totalitarian and caste systems elsewhere in the world at that time.

Would you like to talk about this more, too? I'm up for it and think between us we can hammer out a lot of important points.

http://usdphl462.wordpress.com/2...

Pterocarya frax...

What we have in your first link is the viewpoint of some extreme conservative trying to justify his opinion through originalism.

That is not my opinion, nor the opinion of many, as to what that part of the Constitution means. If we start trying to use originalism to analyze the 2nd amendment, current thinking of gun rights totally goes out the window.

I do find a quote from your link interesting:

John Quincy Adams, sixth President of the United States, once observed: “Our Constitution professedly rests upon the good sense and attachment of the people. This basis, weak as it may appear, has not yet been found to fail.”

Well that basis has clearly failed.

The Hero Zone's picture
The Hero Zone

Originalism versus what? Populism? Revisionism? You are welcome to offer your thoughts on the Second Amendment as something else to explore. What it comes down to is that this is a legal document written specifically for a reason and in the fashion it was. Just because a word was redefined 150 years later doesn't then retroactively apply to what was written. Unless you are in a loaded Supreme Court, but again that's something else to talk about.

Why do you suppose it has failed, Pter? Is it because our schools (let alone families and civic groups) have failed the future generations by not or not adequately explaining the Constitution? Is it because the people who hold elected office and swear to uphold something they never read...a trend we see with much of the legislation that is passed like various bodily movements. It's easy to misread and bemoan something that isn't understood and was probably never read.

Donegan

"We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare"
When has the Democrats ever insured domestic tranquility? Or for that matter established justice? Now that you have adopted the name of Democrat do not think us that know history have forgotten the greatest terrorist organization in American history for what it is. Promote those in Washington is what you want at the expense of the common welfare of the citizens is what you actually mean.

Contango

"promote the general Welfare.'"

The intended definition is not the 'socialist' one you imagine.

Maggdi

'Non partisan,... less frequently?
Hot Damn!
Sign me up.
Can't believe I resisted!

The Hero Zone's picture
The Hero Zone

So in summary...

Title: Things may possibly happen because of various circumstances yet to be seen.

Body: When compared to single, cherry-picked numbers with no context, people expect the aggregate to not be as bad as individual circumstances. We are then going to talk about things that existed before the overhaul as if they can be attributed to it. Next we'll quote an expert or two to attempt to provide insight into the fact rates will still be going up while ignoring the fact that the taxpayer will subsidize failing insurers. Lastly we are going to provide one-sided anecdotal evidence to appeal to emotion, attributing to God what can be no further example the results of mankind. I'm happy Charmaine has coverage (though why not under Medicaid?) but she should thank her neighbors or congregation who pay taxes and not God for this.

The more things change, the more they stay the same: http://youtu.be/px7aRIhUkHY

KURTje

Only in this country. Health care has a history of being too costly. It needs addressed.

Contango

Re: "Health care has a history of being too costly,"

Clueless per usual.

HC was relatively inexpensive until the liberals like LBJ tried to 'fix' it.

jmgthatsme

suuuure Obumacare "may" lower insurance rates...It also "may" snow in July in Vegas.

Contango

"Watchdog: 115-day appointment wait at Phoenix VA"

http://www.cnbc.com/id/101711517

And some wrong-headed socialists think that this would be a good model for U.S. single-payer.

KURTje

AJ Oliver is right . Not to mention no more bus trips for oldsters getting lower cost maintenance drugs from Canada? Why? Answer pdb.