Arizona wins the 2017 ObamaCare sweepstakes: 116% increase in benchmark premium

posted at 6:41 pm on October 27, 2016 by Ed Morrissey

And here I thought that my home state of Minnesota would take the top prize in the ObamaCare follies for 2017. Not only did premium prices go up an average of 60%, but the state Commerce Commissioner had to agree to ration access to all but one plan to keep the insurers from bolting altogether. Combine that with Governor Mark Dayton’s years of mindless ObamaCare boosterism, and I figured Minnesota was a lock on Patsy of the Year.

To quote a famous philosopher … Yo, Minnesota, I’m really happy for you, and I’ll let you finish, but Arizona had one of the worst cons of all time:

The Department of Health and Human Services revealed Monday that premiums for a midlevel benchmark plan will increase an average of 25 percent across the 39 states served by the federally run online market, and that about 1 in 5 consumers will have plans only from a single insurer to pick from, after major national carriers such as UnitedHealth Group, Humana and Aetna scaled back their roles.

However, in Arizona, unsubsidized premiums for a hypothetical 27-year-old buying a benchmark “second-lowest cost silver plan” will jump by 116 percent, from $196 to $422, according to the administration report.

Say, maybe we’ll still win on style points. Actually, no one wins this competition; there are only levels of losing, and Arizona consumers will get hit the hardest this year.

How does one justify more than doubling the monthly premiums of a plan that has fewer provider choices? So far, the administration hasn’t even bothered to justify it, only stating that most of the ObamaCare exchange consumers will end up paying much less, thanks to extensive taxpayer-provided subsidies. But that doesn’t solve the problem — it just shifts the massive price increases to all taxpayers instead. Those subsidies have grown far faster than initial estimates six years ago, when Democrats had to engage in some creative accounting to claim that the ACA would be deficit neutral. Skyrocketing premiums have put an end to that argument; in fact, Democrats almost never mention it any longer.

The collapse of the ObamaCare system should be an up-front-and-center topic in this election, especially given the doubling down on it from both the Obama administration and Hillary Clinton. In my column for The Fiscal Times, I argue that they’re offering the hair of the dog to the crippling hangover ObamaCare has produced:

If Obama wants to double down on failed and expensive subsidies, Clinton wants to do the same with mandates and price controls. Having made the continuation of Obamacare a campaign promise, the Democratic nominee pledged again to “build on the progress we’ve made and fix what’s broken.” The latter, not surprisingly, consists mainly of doing more of the former.

As insurance companies have found themselves stuck in the vicious cycle of rising costs and narrowing risk pools, they have begun exiting the ACA exchanges altogether, which has left some consumers with two or fewer options. Clinton proposes to “improve choices and increase competition” not by remedying the mandates for comprehensive coverage and community pricing, but by reviving “a public option.” That idea died in 2009, mainly under pressure from Republicans who rightly saw it as a Trojan horse for single-payer health care. …

Clinton also promised to “take on the pharmaceutical companies for driving up drug prices,” a refrain that should sound familiar to Americans. The Obama administration and Democrats on Capitol Hill made similar claims about health insurers and supposed “windfall profits” made off of Americans. Obamacare was supposed to cure that ill, too, only as it turns out, the disease didn’t exist.

Even at that time, for-profit health insurers had modest profit margins, far below that of other industries. The small margin pre-ACA became an acute problem when Obamacare forced them to take on high-risk consumers without pricing their risk directly. Rather than charge higher prices to those with higher risk, insurers had to hike premiums – and especially deductibles – across the board under required “community rating” policies.

Everyone else had to pay more to shield insurers from the high utilization curves that resulted, and now much of that cost hits all taxpayers through premium subsidies. A government takeover of the market did not change the nature of risk pools, nor will a government takeover of pharmaceutical markets and pricing change the nature of technological innovation, research, and safety protocols.

Finally, Glenn Reynolds wonders why the media is not talking about this — or about rampant corruption revealed in Hillary Clinton’s record:

The Affordable Care Act, better known as “ObamaCare,” was passed via a procedural trick called “reconciliation” and without a single Republican vote. Now that it is falling apart, and the Obama Administration — and the press — are blaming . . . Republicans for not fixing it. ObamaCare is imploding because the original concept was unworkable, as many critics argued at the time it was adopted. Now, several years later, insurers are abandoning the project and Americans’ premiums are facing double-digit increases.

Given that this was President Obama’s signature legislative achievement, and given that Clinton is running, essentially, on the promise of a third Obama term, you’d think this would be a top story in the news, getting the full-bore coverage every day that, say, a groping allegation against Donald Trump receives. But you’d be wrong. As Twitter humorist Jim Treacher says, “Modern journalism is all about deciding which facts the public shouldn’t know because they might reflect badly on Democrats.” …

Corruption, unaffordable healthcare, a burgeoning national debt: These are all things that will have serious consequences for Americans for decades, to come. In a healthier society, our election would turn on these issues. But we do not live in such a society. And that suits politicians, and their supporters in the press, just fine.

Indeed, to quote the man himself.


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