By Investor's Business Daily
Health Reform: ObamaCare rates will skyrocket next year, according to its former chief. Enrollment is tumbling this year. And a big insurer is quitting most exchanges. That’s what we learned in just the past few days.
Marilyn Tavenner, CEO of America’s Health Insurance Plans, revealed that she expects ObamaCare premium hikes “to be higher than we saw previous years,” including last year, which saw double-digit rate increases across the country.
Tavenner, for those who don’t know, was head of the Centers for Medicare and Medicaid Services until early 2015, which means she helped bring ObamaCare to life. In November 2014, she was boasting how “the Affordable Care Act is working to improve competition and choice among marketplace plans.”
Now that she’s jumped to the other side of the fence, she’s discovered the dark side of the health reform monster she helped unleash.
Why will 2017 rates spike even higher? In addition to the cost of complying with ObamaCare’s insurance regulations and mandates, there’s the fact that the ObamaCare exchanges have failed to attract enough young and healthy people needed to keep premiums down. Plus, two industry bailout programs expire this year, Tavenner notes.
Oh, and she admits that people are gaming ObamaCare just like critics said they would: buying coverage after they get sick — since insurance companies can no longer turn them down or charge them more — then dropping it when they’re done with treatments. “That churn increases premiums. So you have to kind of price over that.”
The timing of these coming rate shocks couldn’t be worse for ObamaCare supporters, since insurers will start announcing premium increases just as the presidential election heats up. Insurers have already requested 18% rate increases in Virginia.
Meanwhile, IBD’s Jed Graham reported on Friday that ObamaCare enrollment has already dropped an average of more than 14% in five states since February — a faster rate of decline than last year — as people get kicked off for not paying premiums.
Finally, we learned on Tuesday that UnitedHealth Group (UNH) is planning to drop out of almost every ObamaCare market it currently serves after losing $1 billion on those policies.
The result will be less competition in those states. An analysis by the Kaiser Family Foundation found that “more than one in four counties where UnitedHealth participates nationally would see a drop from two insurers to one if the company exits and isn’t replaced by a new entrant.”
Skyrocketing premiums, fewer choices in the marketplace, and people fleeing ObamaCare in droves after signing up. This isn’t exactly what Obama promised when he signed ObamaCare into law.
Democrats running for re-election this year might want to think twice about wrapping their arms around this terminally ill law. And Republicans should be busy crafting a replacement.