Obamacare May Only Raise Premiums For 3 Percent
In the days since the Obamacare rollout, Republicans have attacked the Administration for lying when they repeatedly said that everyone can keep their existing coverage and no one’s premiums will go up. In reality, that was an implausible statement considering the law prevents companies from offering junk insurance policies that require high co-pays and provide minimal coverage. The Administration and lawmakers knew this was the case long before people started complaining about lost coverage since they knew that several million plans would no longer be valid.
Lost in the Republicans’ complaints about Obama’s and Health Secretary Kathleen Sebelius’ statements is how big of a lie that actually was. According to a recent study by The New Yorker, only 3 percent of Americans are “potential losers” in the Obamacare rollout, meaning they will have to buy a higher quality health plan that costs more.
Since the law deals mostly with individual insurance buyers, the 80 percent of American households that receive employer-funded insurance plans will be unaffected. That leaves 20 percent of Americans, 6 percent of which already have insurance. According to the study, half of those people will have to change their insurance plan but the policy will be similar in coverage and cost which means there isn’t much effect for that 3 percent of Americans either. That leaves 17 percent. Fourteen percent are the “winners” of the new law because they are uninsured and will be able to gain affordable insurance that is subsidized by the government.
That leaves 3 percent of people who will have to upgrade their current plan because it doesn’t provide adequate coverage under the law. That doesn’t mean that they will have to pay more, however. Since most people who opted for the bare minimum plan did so because of financial constraints, many will be eligible for government subsidies. That means a higher premium doesn’t actually mean you pay more at the end of the day.
The Administration was wrong to say that everyone can keep their current plan since they knew that there were millions of inadequate plans in effect. That doesn’t change the fact that the law helps or doesn’t affect 97 percent of people and is likely to help the remaining 3 percent in the form of improved coverage and government subsidies to cover their new plans.