October 26, 2017

Obamacare costs to leap, largely thanks to Trump

Business insider - A new study projected that average premiums in the Affordable Care Act's individual insurance exchanges will once again leap in 2018.

The study by healthcare consulting firm Avalere Health said that the average increase for the premiums of a silver-level plan would be 34% and the average second-highest cost silver plan, typically used as the benchmark, would increase 38% nationwide. That would be higher than the 25% increase for the benchmark plans in 2017.

According to Avalere, there are a few reasons for the projected increase:

- President Donald Trump's decision to halt so-called cost-sharing reduction payments and Congress' inability to appropriate them. Lower enrollment than expected in the exchanges and insurer's subsequent exits from the exchanges. "Insufficient action by the government" to help offset losses by insurers, including the lapse of the reinsurance and risk corridor provisions. "General volatility around the policies governing the exchanges."

-"Plans are raising premiums in 2018 to account for market uncertainty and the federal government’s failure to pay for cost-sharing reductions," said Caroline Pearson, senior vice president at Avalere. "These premium increases may allow insurers to remain in the market and enrollees in all regions to have access to coverage."

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