UPDATE – Obamacare Has Lowered Premiums, Really

There’s a bit of sophistry going around the echo chamber that Obamacare has lowered insurance premiums.  Tonight, I will address that, and tell you about some other stories that caught my eye this week.

After dozens of stories about double-digit rate increases this year, you’d think people would be embarrassed to argue rates have gone down under Obamacare.  But I guess the die-hards have to try.

Our old friend Jonathan Gruber is back, joining others in saying that Obamacare has lowered premiums.  Premiums are lower today than what they would have been if Obamacare had not been passed, they argue.  What’s more, premiums dropped substantially in the first year of Obamacare, they say.

Without getting too far into the weeds, there are some easy responses to all of this.  First of all, it’s bone-headed to say rates are low because there is good competition on the exchanges.  In 536 counties across the country, there are only two insurers.  One of them is UnitedHealth, which is pulling out.  Obamacare has hurt competition, not helped it.  Second, it’s a weak argument to say the insurance companies low-balled rates the first year to lure people in, or because they could not price preexisting conditions correctly.  How is that a triumph of Obamacare?  It’s not.  Third, it’s disingenuous to say rates are low because the government has subsidized the insurance companies to the tune of billions of dollars.  True rates haven’t gone down.  All the Obamacare-meisters have done is hide the ball.  And the insurance company subsidies are supposed to end this year –  do you really think rates won’t go up after the insurance companies lose their subsidies?  Fourth, it’s also disingenuous to say that rate increases don’t matter because most people on the exchanges get tax credits from Uncle Sam.  That’s like saying prices are lower at Nordstrom’s because your uncle is buying your clothes.  Prices aren’t lower; it’s just that you’re not the one paying them, so that’s a crazy argument.  Moreover, there are lots of people on the exchanges who don’t get subsidies.  The double-digit increases are hitting them right between the eyes.

Finally, all of this completely misses the point.  President Obama promised over and over again that the average family would see their premiums go DOWN $2,500 a year under Obamacare.  Nobody got the $2,500 break they were promised, and that’s the issue as the Truth Squad sees it.  Promises were made; promises were broken.  Where’s my 2,500?  Don’t try to flim-flam me with your sophistry.

If you want to get further into the weeds, a more technical rebuttal was published in Forbes this week.  I’ll send the link in for the wrap-up.

Some other news caught my eye this week.  The government has moved to block Anthem’s $48 billion merger with rival health insurer Cigna.  Anthem is fighting the move, telling the government that approval of the merger would enable Anthem to continue selling insurance in the Obamacare exchanges.  The veiled threat is they will leave the Obamacare business entirely if they don’t get their merger. Pretty nervy, huh?  Let’s Make a Deal – a crony deal.  Next, there are 13 states that run their own Obamacare exchanges.  They got federal grant money to help them get off the ground, but they were supposed to be financially self-sufficient by the end of last year.  A lot of them couldn’t make enough on their own through user fees so, in another miracle of Obamacare loaves-and-fishes, some federal grant money was extended through this year and into 2017.  What this means is that federal money is covering up the fact that some of these exchanges are in real financial trouble.  It looks like there will be more state exchange train wrecks in the future.  Another story praised Obamacare for providing coverage for catastrophic care and major illnesses.  Huh?  We had to have Obamacare because catastrophic insurance was so crummy, but – ? – now they’re praising Obamacare because it provides catastrophic coverage? Talk about spin, wow.  That’s bold.  Obamacare was supposed to be so much more.  Finally, in a piece of good news for religious liberty, a judge ruled that ordinary people can’t be forced to buy contraceptive coverage as part of their Obamacare policy.  Think of it as a Hobby Lobby win for individuals and families.  But we’ll see what happens on appeal.


‘Obamacare has lowered premiums’:



UnitedHealth is 1 of 2 insurers in 536 counties; pull-out will cause rates to go up

“Overwhelming Evidence That Obamacare Caused Premiums To Increase Substantially”

Let’s Make a Crony Deal – give me my merger and I’ll stay in the Obamacare business. And if you don’t….

Continuing federal aid masks budget shortfalls at state exchanges

‘Obamacare provides safety net for catastrophic care & major illness.’ How the mighty have fallen. #ItsNotWorking

Federal judge rules Obamacare can’t force individuals and families to buy contraceptive coverage

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