ACA: ‘Cheaper Than Expected’ Not The Same As Cheaper

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Talking Points Memo weighed in today with a jubilant headline: Final Word On Obamacare Coverage: Cheaper Than Expected. What actually happened was the U.S. Department of Health and Human Services is predicting that private for-profit individual health insurance premiums will be lower than originally estimated by the Congressional Budget Office.

In other words, “cheaper than expected” is not the same thing as cheaper. Health insurance premiums have been skyrocketing across the country for years. Even a reduction at this point means the insurance is overpriced. The ACA requires everyone not covered by employer-sponsored plans to purchase individual health insurance with their own money, unless qualified for Medicaid. In addition to the monthly premiums, “insured” individuals have to pay for any non-preventive health care themselves until they reach the deductible, which can be as high as $2,000. The deductible, coinsurance and copay expenses can amount to as much as $5,950 $6,350 [h/t Ronald D. Hunt for the California rates]. The deductible and out-of-pocket limitations are subject to annual inflationary adjustments. These policies are effectively USELESS for many people, yet the insurance companies still get their monthly premiums.

Also, this is NOT the final word on premiums. FDL’s Jon Walker (emphasis added):

The HHS is extremely happy the premiums are lower than some old CBO estimates but that is a silly metric to judge by. More PR than policy.

It is important to note that no one really knows how many people and which type of people will sign up. These premiums are also simply based on insurers best guesses. After this first year when companies have real data we could potentially see some significant changes in premiums in either direction. 2015 not 2014 will be the real test from a policy perspective.

More info:

UPDATE: What Will You Pay For Obamacare? Depends On Where You Live (MAP)

UPDATE: Economist Mark Zandi Debunks Myth That Obamacare Is Hurting Full-Time Work

The evidence is overwhelming that the Affordable Care Act has had little to no impact on full-time versus part-time job growth, and as Fox News personalities continue to push the myth, they find themselves in direct contradiction with analysis put forth by actual economists.

UPDATE: ACA Exchanges Still Have Some Serious Glitches

[T]he administration has had four years to work on implementation. The fact they couldn’t work out all these problems during that incredibly long lead time is not a reassuring sign.

  1. #1 by Richard Warnick on September 26, 2013 - 10:33 am

    UPDATE: What Will You Pay For Obamacare? Depends On Where You Live (MAP)

    Note that the “bronze plan” is a high deductible plan, which can require the “insured” to pay up to $5,950 in medical expenses before “insurance” pays anything (although certain preventive health services are covered regardless of the deductible).

  2. #2 by Richard Warnick on September 26, 2013 - 7:14 pm

    On a lighter note, everybody loves the Adorable Care Act. And it doesn’t cost any money.

  3. #3 by Larry Bergan on September 27, 2013 - 11:23 am

    I’m confused as to what this bill is about and I’m not going to jump on the bandwagon until I know what it’s going to cost me. Does Obama know what the bill contains? I really doubt it. Does Obama know the schematics of the Space Shuttle? I doubt it.

    If there was a provision in the bill which required it to tell me the exact amount I’m going to pay to get my treatment – boy, that’s a loaded word, isn’t it? – and accept or reject it with a signed letter by me, saying that if I DID reject it, I would be on my own, I could accept it.

    As it stands; We have a bill that requires me to pay for something I may not want that was called constitutional by a Supreme court I don’t trust and was conjured up by “The American Enterprise Institute” – which I REALLY don’t trust – and I’m supposed to be giddy.

    I’m sorry Obama, I’ve become a very cynical guy, but I would rather die with the money I’ve saved, rather then die after giving that money to Bill Frist.

    Simplistic, I know. You’re free to correct me.

  4. #5 by Larry Bergan on September 27, 2013 - 4:50 pm


    You and your fact checking! 🙂

  5. #6 by Larry Bergan on September 27, 2013 - 5:12 pm

    Whether it was the American Enterprise Institute, The Family Research Council. Americans For Tax Reform, The Heritage Foundation, Freedomworks, The myriad of fake organizations Brent Bozell has spawned or The Larry Bergan Foundation of Freedom:

    Don’t trust any of these!

    • #7 by cav on September 28, 2013 - 10:43 am

      “Whether it was the American Enterprise Institute, The Family Research Council. Americans For Tax Reform, The Heritage Foundation, Freedomworks, The myriad of fake organizations Brent Bozell has spawned or The Larry Bergan Foundation of Freedom:”

      In fact Larry, it was the whole of the presently constituted U. S. Government – the subsidiary of so many banks and insurance companies, at their most creative (or is that destructive?), that decided to forgo any and all rational offerings, buy the whole of the austerity noise, uninhibitedly supporting all of the spying on its citizenry before billing us all for insurance – which itself is not to be equated with ‘healthcare’

      I’m almost to the point of supporting the ‘Shut Down The Government’ effort, but I’m too afraid the thugs, when all is said and done, will somehow spin it to their advantage.

      • #8 by Larry Bergan on September 28, 2013 - 3:38 pm

        You better believe the health insurance companies are going to come out ahead – money wise – in this deal. If it doesn’t happen immediately, it eventually will.

        You can count on it.

        Hell, you can invest in it!

        • #9 by brewski on September 28, 2013 - 9:35 pm

          Larry, you are correct! And this was predicted 3 years ago when the bill was passed.

          “After the bill passed the House Sunday night, healthcare stocks led the market rally the next day. The outcome was clear to the most sophisticated investors long before negotiations began. Less sophisticated investors only realized what would come of Obama’s healthcare reform by late 2009. As a result, HMO stocks have been rising since November 2009, significantly outperforming the S&P 500 Index. “

  6. #10 by cav on September 28, 2013 - 6:07 pm

    May I just point out that as of October 1, every American can start signing up for Medicare, now known as Medicare for all, regardless of age so that they are on the rolls on January 1st… doesn’t take a whole lot of explanation or messaging.

  7. #11 by Richard Warnick on October 2, 2013 - 5:51 pm

    FDL’s Jon Walker on the ACA plans revealed yesterday:

    A middle class family who buys a government approved silver plan will probably think they have decent insurance can suddenly be forced into medical bankruptcy if a family member gets seriously ill. Most middle class families can’t afford a surprise $12,000 bill. After all most medical bankruptcies in the United States are people who had insurance, just not good enough coverage.

    …As the old joke goes, people think their insurance is great until they go to use it. All indications are this will be the same with the Affordable Care Act.

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