Donald Trump on Sunday night called Obamacare a “disaster,” saying that premiums are skyrocketing at record levels. But Trump routinely cherry-picks the largest increases health insurance companies have proposed to state and federal regulators to exaggerate the scale and extent of these rate hikes.
It’s true that premiums for the health insurance plans that more than 20 million people buy, either from an Obamacare exchange like HealthCare.gov or directly from an insurer, are going up next year ― and in some cases, by a lot.
None of this relates to the cost of health insurance provided by employers ― which is how nearly half of Americans get their coverage, and is rising in the mid-single digits on average.
The Affordable Care Act reduced the uninsured rate to the lowest it’s ever been recorded and eliminated some of the health insurance industry’s worst practices, like refusing to cover people with pre-existing conditions. Yet it’s encountering major headwinds going into November, when its fourth year of sign-ups will launch.
Prices will go up nearly 25 percent on average, according to an analysis by Charles Gaba of acasignups.net ― meaning some consumers will see smaller increases next year, some will see bigger ones and a few will actually pay less, even though premiums remain lower than the Congressional Budget Office projected in 2010.
And a sizable portion of customers in this part of the health insurance market may avoid the worst of the price increases.
Among those who use the exchange marketplaces to shop for coverage, about 85 percent receive tax credit subsidies that cap the amount they pay for coverage at a percentage of their incomes. Nearly three-quarters of these enrollees will have access to coverage that costs $75 or less a month, according to the Department of Health and Human Services.
The 15 percent who don’t receive tax credits ― and the millions who buy unsubsidized policies from an insurance company or through a broker ― don’t have that firewall, and therefore will have to bear the full brunt of the additional cost.
For both groups of consumers, however, the experience of the first three years of exchange enrollment suggests a significant proportion of them could protect themselves against the largest increases by switching to plans offered by other carriers with more affordable rates.
The bad news for these segments of the population is that the departure of large health insurance companies like UnitedHealth Group and Aetna from most exchanges, and the collapses of many nonprofit co-op insurers, will limit choice on the marketplaces next year. This will make it harder to find comparable coverage at lower prices than it was in 2015 and 2016.
Whatever its problems, the Affordable Care Act is superior to Trump’s health care proposals when it comes to coverage and costs to consumers, according to a recent analysis by the RAND Corp. and the Commonwealth Fund.
By repealing the Affordable Care Act completely, Trump would take away health insurance from 19.7 million people. His proposals, including slashing Medicaid funding, making health insurance premiums tax-deductible, and permitting an insurer in one state to sell policies to consumers living elsewhere, would further decrease coverage while significantly increasing costs by low- and middle-income families while reducing costs for wealthier households.
By contrast, Clinton’s proposals, including new tax credits for people with very high medical expenses and establishing a government-run “public option” plan that would compete with private insurances, would result in as many as 9.6 million people with coverage and reduce costs for low- and middle-income families.
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