Tag Archives: Premium

News

Has the passage of Obamacare reduced health insurance premiums?

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Investors Business Daily does the math.

Excerpt:

The cost of an average family premium shot up 9.5% in 2011 — the highest rate in seven years and three times the rate of overall inflation, finds a major new survey of employer plans by Kaiser Family Foundation.

Just before Obama signed his health overhaul, he vowed it would “bring down the cost of health care for families, for businesses and for the federal government.” In December, he told CBS’ “60 Minutes” he was “putting in place a system that’s going to lower health care costs.”

In fact, there’s evidence ObamaCare is fanning medical inflation.

Kaiser attributes the premium spike to “changes from the new health reform law.” The 200-page study explains: “Significant percentages of firms made changes in their preventive care benefits and enrolled adult children in their benefits plans in response to provisions in the new health reform law.”

In fact, 31% of covered workers are in a plan where the employer reported adding preventive services to comply with ObamaCare. And some 2.3 million adult children “were enrolled in their parent’s employer-sponsored plan due to the Affordable Care Act,” Kaiser said.

Sen. Ron Johnson, R-Wis., notes that Obama, as a candidate, promised he’d slash family premiums by $2,500 a year by the end of his first term. That was in 2008, when health care coverage cost the average employer and American family $12,680 in annual premiums. Now it’s $15,073, nearly 20% higher. That means Obama has broken his promise by a whopping $4,893.

Costs are projected to simply rise as ObamaCare fully goes into effect. A recent McKinsey & Co. study found that 30% of employers will stop offering benefits after 2014, since “the penalty for not offering coverage is significantly below” the costs of the new mandates. This will make millions more individuals eligible for government subsidies under ObamaCare.

Not everything that Obama says while he is reading from a teleprompter is necessarily true.

News

Obamacare causes companies to drop health insurance coverage

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Story here in the radically left-wing anti-american New York Times. (H/T ECM)

Excerpt:

The Principal Financial Group announced on Thursday that it planned to stop selling health insurance, another sign of upheaval emerging among insurers as the new federal health law starts to take effect.

The company, based in Iowa, provides coverage to about 840,000 people who receive their insurance through an employer.

Principal’s decision closely tracks moves by other insurers that have indicated in recent weeks that they plan to drop out of certain segments of the market, like the business of selling child-only policies. State regulators say some insurance companies are already threatening to leave particular markets because of the new law. And some regulators in states like Maine and Iowa have asked the Obama administration to give insurers more time to comply with some of the new rules.

[…]More insurers are likely to follow Principal’s lead, especially as they try to meet the new rules that require plans to spend at least 80 cents of every dollar they collect in premiums on the welfare of their customers. Many of the big insurers have been lobbying federal officials to forestall or drastically alter those rules.

“It’s just going to drive the little guys out,” said Robert Laszewski, a health policy consultant in Alexandria, Va. Smaller players like Principal in states like Iowa, Missouri and elsewhere will not be able to compete because they do not have the resources and economies of scale of players like UnitedHealth, which is among the nation’s largest health insurers.

Mr. Laszewski is worried that the ensuing concentration is likely to lead to higher prices because large players will no longer face the competition from the smaller plans. “It’s just the UnitedHealthcare full employment act,” he said.

So basically Obama passed a plan to destroy competition, leaving consumers with fewer choices and paving the way for increased health insurance premiums. And now he wants to go on another vacation because he is doing such a good job. (H/T ECM)

News

Health insurers are dropping coverage of children

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You know those mandates that force insurance companies to cover children of adults until they are 26 years old? And the ones that forbid rejecting children who have pre-existing conditions? Yeah that costs insurance companies money. Can you believe that? Health care costs money! It costs more money to cover people for mandated coverages! Who could have foreseen that? Not Obama and his merry band of tenured Ivy League hermits, who have never held private sector jobs in their entire lives.

Story from The Hill. (H/T Health Care BS via ECM)

Excerpt:

Health plans in at least four states have announced they’re dropping children’s coverage just days ahead of new rules created by the healthcare reform law, according to the liberal grassroots group Health Care for America Now (HCAN).

The new healthcare law forbids insurers from turning down children with pre-existing conditions starting Thursday, one of several reforms Democrats are eager to highlight this week as they try to build support for the law ahead of the mid-term elections. But news of insurers dropping their plans as a result of the new law has thrown a damper on that strategy and prompted fierce push-back from the administration’s allies at HCAN.

The announcement could lead to higher costs for some parents who are buying separate coverage for themselves and their children at lower cost than the family coverage that’s available to them.

[…]Health plans and state insurance commissioners in July raised concerns that the new rules could lead some insurers to stop children-only coverage because families could wait until their children get sick to buy coverage.

[…]…insurers including WellPoint and CoventryOne have announced in recent days that they’re dropping children’s coverage in California, Colorado, Ohio and Missouri, according to HCAN.

Yeah, insurance companies don’t like being forced to add coverages, (= risk of having to pay claims), while keeping premiums the same. It increases their losses. And if they can’t raise premiums to cover the increased exposure to claims on these additional coverages, then they go out of business. And then you get to pay for your own health care costs out-of-pocket.

The only person who did not see this coming is Barack Obama. He understands less about economics than my keyboard.

Here is my previous post about Connecticut raising their health premiums 20% or more to respond to Obamacare.