Veronique de Rugy predicts disaster for Obamacare once again:
The bottom line is that after slow start, insurance companies find themselves having to increase premiums a fair amount. It seems that while for now subsidies may cover the pain for individuals, they probably won’t be able to after this year, at which point insurance companies will have to stomach the full cost of their losses due to the expiration of the reinsurance and risk-corridor programs. There soon won’t be enough subsidies to offset the premium hikes.
We’ve heard this pretty much every year: insurers are requesting huge premium increases! We’re doomed! Perhaps a bit of perspective would be helpful:
- Insurers lowballed their Obamacare prices initially, coming in with premiums that were less costly than CBO projections. Higher prices were always inevitable.
- Every year, insurers request big increases. They don’t get them. They get moderate increases.
- Whatever happens, this is the free market at work, not some defect in Obamacare. If high premiums are truly what conservatives care about, we can fix that any time we want. Just ask Canada how to do it—or Sweden or Germany or Spain or Japan or pretty much any other advanced country on the planet.
Life isn’t perfect. Obamacare isn’t perfect. Health care is an expensive service, and health care insurance is expensive too. But so far Obamacare has done a pretty good job of keeping costs reasonably well contained. I’d wait until the end of the year before yet again declaring that it’s a failure and yet again being wrong.