Obamacare is Toast

"Death Spiral": Obamacare Premiums May Soar As Much As 91% Next Year, by Tyler Durden, 5/7/18, Zerohedge

Residents of Maryland and Virginia face double-digit percentage increases in premiums for individual Obamacare plans in 2019, according to rate requests made by insurers.

The largest hikes are being sought by CareFirst, which is seeking a 64% increase in Virginia, and a whopping 91% increase in Maryland for its PPO. Other insurers are following suit in the two states, with Kaiser requesting hikes of 32% and 37% respectively, followed by CareFirst's HMO offering.

In Maryland, CareFirst wants to raise rates by 91 percent on a plan covering 15,000 people, Insurance Commissioner Al Redmer Jr. said. If approved, premiums for a 40-year-old could reach $1,334 a month. -Bloomberg

That's over $16,000 per year for an individual plan in a state with an average personal income of $59,524.

“We have folks in Maryland that are struggling, that are trying to do the right thing, and they’re paying more for their health insurance than they are for their mortgage,” Redmer said on a call with reporters.

Maryland is seeking permission from the federal government to create a reinsurance program that would use $975 million in state and federal funds over five years to lower rates. That would help only temporarily, Redmer said. -Bloomberg

“I believe we’ve been in a death spiral for a year or two,” he said, adding that a permanent solution requires Congress to fix the Affordable Care Act.

Virginia and Maryland are the first two states in which 2019 rate requests, which are subject to regulatory approval and may change have been made public, however increases are anticipated across the country as insurers adjust to the post-ACA battle. Final premium increases will need to be approved ahead of the November 1 open-enrollment period.

The hikes are being blamed in part by the expectation that the elimination of the Obamacare stipulation forcing all Americans to have health coverage would leave insurers with a smaller pool of sicker clients. 

Many health plans have stopped selling health coverage through the exchanges created four years ago under Obamacare. The Republican-led attempt to overturn the health law last year caused premiums to surge, as insurers expected that undoing the law’s requirement that all Americans have health insurance would leave them with a smaller and sicker pool of clients. -Bloomberg

While the repeal of ACA ultimately failed, the Trump administration overturned the provision penalizing uninsured Americans - something last week Trump's former top health official, Tom Price, warned would raise the cost of health insurance for some Americans.

“There are many, and I’m one of them, who believes that that actually will harm the pool in the exchange market, because you’ll likely have individuals who are younger and healthier not participating in that market, and consequently that drives up the cost for other folks within that market,” Price said at the World Health Care Conference in Washington.

Price's comments are in line with predictions from the nonpartisan Congressional Budget Office, which in November projected 13 million fewer Americans would have health insurance by 2027 as a result of the elimination of the individual mandate. The CBO also said average premiums in the exchanges would increase by about 10 percent in most years over the next decade, compared with a scenario in which the mandate had been left in place. -Washington Post

“Those effects would occur mainly because healthier people would be less likely to obtain insurance and because, especially in the non-group market, the resulting increases in premiums would cause more people to not purchase insurance,” the CBO said at the time.

“The individual mandate is one of those things that is actually driving up the cost for the American people in terms of coverage,” said Price on last summer on ABC’s This Week. “So what we’re trying to do is make it so that Obamacare is no longer harming the patients of this land — no longer driving up costs, no longer making it so that they’ve got coverage but no care.”

In Virginia, the health insurance market is quite sick - with Charlottesville and neighboring counties suffering under some of the most expensive healthcare costs in the nation for people who don't receive government subsidies. 

A 40-year-old trying to afford a mid-level plan will pay around $1,048 a month. 

"Carol Wise, a former nurse and social worker in Charlottesville who consults for nonprofits, paid about $640 a month last year for an individual plan from Anthem," reports Bloomberg. "When Anthem pulled out of her area, the only plan available, insurer Optima Health Plan, had a premium of $1,800 a month." “I was blown away,” said Wise, 62. Wise instead joined a health-care sharing ministry for $280 a month, which offers far fewer protections than traditional coverage. 

Breakdown of each insurer's proposed changes via Bloomberg: 

·       Group Hospitalization and Medical Services Inc., which operates a CareFirst BlueCross BlueShield, wants to raise premiums by 64 percent, on average, compared with 2018 premium levels, according to documents filed with Virginia regulators on May 4. The change would affect more than 4,000 customers.

·       The Kaiser Foundation Health Plan is seeking an average rate increase of 32 percent on about 79,000 members in Virginia, while Cigna asked regulators to approve a 15 percent increase, projected to affect 103,000 members.

·       Optima, which some Virginians have criticized for highest-in-the-nation premiums in some areas, said that on average its rates would decrease by 2 percent, and they would decline as much as 27 percent for some customers.

·       In Maryland, CareFirst’s larger HMO plan covering 123,000 people requested a 19 percent increase. Kaiser is seeking a 37 percent hike. Both would put the new rates for a 45-year-old above $500 a month, Maryland officials said.

·       Anthem Inc., which pulled out of many markets this year, is requesting a 6 percent increase for its Health Keepers-branded plans in areas of Virginia where it remains.

“We’re still sky-high, and we still have a lot of concerns about the rates,” said Charlottesville resident Ian Dixon, who has helped organize Virginians to apply pressure on legislators and Optima for lower premiums. Even with a drop around 30%, he said, Optima’s 2019 rates come in at around double what residents were paying in 2017, when Anthem and other insurers were still offering plans.

https://www.zerohedge.com/news/2018-05-07/death-spiral-obamacare-premiums-may-soar-much-91-next-year

Norb Leahy, Dunwoody GA Tea Party Leader