Families brace for steep hikes: Opposing view

Grace-Marie Turner | USA TODAY

American families, promised they would save $2,500 a year on health insurance premiums, are bracing themselves to see just how much their costs will increase again next year.

Health insurers across the country are seeking premium increases of 20% to 40% or more. Some carriers requested only modest increases, largely because they priced premiums in line with expected medical expenses in the first year. But many others found enrollees are sicker and more costly than anticipated.

Blue Cross and Blue Shield of New Mexico requested a 52% increase for 2016 individual plans, but the hike has been denied by the state’s insurance regulator.

President Obama is jawboning regulators to lower rates, but that can only go so far when plans face multimillion dollar gaps between premium income and claims payments.

To offset the cost of the Affordable Care Act’s many new mandated benefits, the most popularly priced plans have ultra-limited networks plus high out-of-pocket costs and deductibles that are nearly twice as high as employer insurance.

A report from Avalere Health found that ACA plan enrollees have access to 34% fewer providers than those in commercial plans outside exchanges.

In its 2015 survey, Deloitte found only 30% of exchange enrollees were satisfied with their plans, significantly fewer than other insured groups.

Absent quick congressional action, rate shock also could be coming to midsized groups. Next year, businesses with 51 to 100 employees must comply with a battery of new ACA regulations estimated to increase premiums by an average of 18% for 150,000 businesses covering 7 million workers and dependents.

Middle-income Americans who remain dissatisfied with the law face base rate increases of more than 40% over pre-ACA rates, and they continue to see higher taxes to offset premium subsidies for those with exchange coverage.

For most Americans, whose main hope for health reform was lower health costs, the Affordable Care Act has not lived up to its name.

Grace-Marie Turner is president of the Galen Institute, which focuses on market-based health reform.