Obamacare premiums appear to be stabilizing after years of eye-popping rate increases, according to a new analysis that says customers should expect an average rise of just 3.3 percent in 2019 and some will see decreases.
The analysis from Avalere Health and The Associated Press shows a shift from this year, when customers on the Affordable Care Act’s exchanges were socked with an average increase of 30 percent.
Consumers will find more choices next year and each county will have at least one insurer selling plans, averting the annual specter of “bare counties” that must be filled.
Premiums will drop or increase by less than 10 percent in 41 states serving 9 million customers, while six other states and the District of Columbia will see increases of 10-18 percent, the analysis says.
Obamacare has consistently struggled to attract the type of young, healthy enrollees it needs to balance out costlier, sicker people who flocked to the marketplace, starting in 2014, because they could no longer be denied coverage.
As a result, premiums soared year after year, causing a political headache for Democrats who sold the program as a competitive marketplace.
Experts say they’re seeing a shift in 2019 because insurers overshot their costs in prior years and cannot justify another rate increase.
Last year, in particular, insurers raised premiums to account for President Trump’s decision to cancel key reimbursements and political volatility around the law.
“With that, they got to a point where they were profitable,” said Chris Sloan, a director at Avalere. “I really think the story here is that health plans have finally gotten a handle on this market, and have gotten handle on some of the political shocks.”
The new data, crunched from final and requested rates in all but three states, could scramble the political narrative around health care in the run-up to the midterm elections.
Democrats have spent much of the midterm season accusing Mr. Trump and Republicans of spiking rates through “sabotage,” such as their expansion of bare-bones plans and repeal of Obamacare’s unpopular individual mandate to hold coverage or pay a tax.
Modest increases will blunt that claim, meaning they will have to fine-tune their message or argue the situation would be better if Republicans had left the program alone.
Rep. Frank Pallone, New Jersey Democrat, said Friday the stabilizing premium numbers prove that demand for robust coverage under the “resilient” Obamacare program is counteracting GOP attacks.
“At the same time, insurers have been clear that premiums would be even lower for the upcoming year if it weren’t for this ongoing Republican sabotage,” he said.
Still, experts say the better-than-expected numbers undercut the Democrats’ hue and cry over the administration’s moves.
“In reality, the Obamacare risk pool was already so bad even Trump couldn’t make it much worse,” said Robert Laszewski, a health policy consultant in Alexandria, Virginia.
On the other hand, conservative Republicans who say Obamacare is tanking — and that winning more seats will let them repeal it — may have a weaker hand to play.
Rep. Andy Harris, Maryland Republican, said the 2010 law’s damage has compounded over time, so Americans are still far worse off and need relief.
“These premiums are so much higher than they were before Obamacare,” he said. “They couldn’t go up forever, they had to stabilize at some point. But they stabilized at a point that’s still unaffordable for millions of Americans.”
He said the outlook is still poor in his state, which — along with Massachusetts and Alabama — was not included in the Avalere analysis.
For years, sharp premium increases under Obamacare drove GOP election victories and the party’s zeal for repeal. Efforts to replace the 2010 law sputtered out of gas in 2017 but could return if the midterm elections help Republicans.
Vice President Mike Pence recently said in Wisconsin that if Republicans pick up seats, “we’ll continue to go back to that.”
Mr. Harris said right now, he’d like to see whether Mr. Trump’s plan to expand the use cheaper, skimpier insurance helps customers who have been priced out of Obamacare.
While federal subsidies absorb premium increases for 8 of every 10 exchange customers, people who earn too much for taxpayer assistance must pay full price for their plans.
“The fact of the matter is if you don’t get a subsidy, they’re unaffordable,” Mr. Harris said.
The program is turning into a marketplace that predominantly serves a sicker, subsidized populace, analysts say.
Even if premiums continue to rise by single digits, people who are younger, healthier or don’t qualify for subsidies may struggle to find comprehensive and affordable coverage on their own, according to Mr. Sloan.
“That was not the goal of the individual market reforms,” he said. “That, at the end of the day, is still a problem.”
Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.