The nation’s biggest health insurers are privately telling brokers to brace customers for a severe Obamacare sticker shock next year, sharing projections that rates could go up steeply for small businesses and more than double for those with individual plans, according to the Wall Street Journal.
As the Journal notes, the situation in the real world contrasts with the portrait being painted by the Obama administration:
The projected increases are at odds with what the Obama Administration says consumers should be expecting overall in terms of cost. The Department of Health and Human Services says that the law will “make health-care coverage more affordable and accessible,” pointing to a 2009 analysis by the Congressional Budget Office that says average individual premiums, on an apples-to-apples basis, would be lower . . .
In a private presentation to brokers late last month, UnitedHealth Group Inc.,UNH +0.33% the nation’s largest carrier, said premiums for some consumers buying their own plans could go up as much as 116%, and small-business rates as much as 25% to 50%. The company said the estimates were driven in part by growing medical costs not directly tied to the law. It also cited the law’s requirements that health status not affect rates and that plans include certain minimum benefits and limits to out-of-pocket charges, among other things.
Other insurers are offering similar forecasts. While subsidies will buffer the effect on low income earners, many in the middle class could be paying significantly more for their health insurance as Obamacare’s one-size-fits-all provisions take effect and consumers are forced to purchase higher-priced plans.
What’s more, healthy young people who have foregone insurance as not worth the cost will now have to have it – and pay for it – effectively subsidizing older, sicker consumers, since insurers in 2014 will no longer be able take health history into account when deciding on coverage and are limited in their ability to do so based on age.