Brace for 2019 Premium Increases Due to GOP Sabotage of the Affordable Care Act

The average marketplace enrollee will pay about $1,000 more for health insurance than they should due to mandate repeal and the short-term plan rule. For those living in Arizona’s Congressional District 1 the increase will be higher. Depending on our age and family situation, our health insurance premium will go up between $1500 – $5250 in 2019 because of Republican sabotage of the Affordable Care Act.  Here’s what’s happened.

Unable to repeal the entire Affordable Care Act in 2017, Congress nonetheless repealed the Individual Mandate effective in 2019. In the absence of a penalty for not purchasing insurance, some people currently purchasing individual market insurance are expected to either stop purchasing any insurance or switch to substandard non-ACA compliant plans. Insurance rates are all about what’s being insured and when the insurance “pool” changes, so do the rates. It is likely that those who leave the regulated individual insurance market will be relatively healthy on average, which will increase premiums in 2019 more than would otherwise be the case. Some insurers may already have increased premiums in 2018 to account for the GOP’s non-enforcement of the individual mandate.

In addition to the repeal of the Individual Mandate, the GOP administration made regulatory changes to widen the availability of short-term plans that offer substandard coverage, harming the ACA comprehensive coverage risk pool and raising rates for comprehensive coverage.

The GOP administration began its assault on the Affordable Care Act as soon as it could. The White House canceled $5 million in paid advertising in the 39 states subject to the federal marketplace for the last week to 10 days of the 2017 open enrollment period, or as much as 80% for that period, which ended Jan. 31. That’s a crucial time for open enrollment, as it typically experiences a surge in sign-ups as people hustle to meet the deadline for coverage. Up to that point, enrollment was running ahead of 2016 figures; afterward, it dropped off sharply. Lowering enrollment meant insurance companies had to raise rates in 2018 to make up the loss.

The GOP repeated this strategy for 2018 open enrollment, slashing the advertising budget by a stunning 90%, to $10 million. The Department of Health and Human Services also cut funds by roughly 40% — to $36.8 million from $62.5 million — for nonprofit groups that employ “navigators,” those who help people in the individual market understand their options and sign up. The result — fewer enrollments and higher rates.

Another tactic for undermining the ACA is the GOP Administration’s refusal to fund payments for risk adjustment, the federal program that discourages plans from avoiding sicker enrollees. Failure to make these payments to insurance companies may be illegal but they will certainly cause insurers to pull out of insurance markets.

Meanwhile, nothing has been done to drive down the increase in prescription drug costs since the GOP has refused to rein in pharmaceutical companies from the outset of the ACA.

The hardest hit by these policies are the middle class, who do not qualify for premium subsidies on the exchanges, and employers who face rising employee benefit costs.

Read more:

Estimated Increases in 2019 Premiums by Congressional District Due to ACA Sabotage – Center for American Progress

Kaiser Family Foundation, Tracking 2019 Premium Changes on ACA Exchanges

American Academy of Actuaries, Drivers of 2019 Insurance Premium Changes

 

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