Millions who buy health insurance brace for sharp increases

Posted September 4

FILE - In this Jan. 31, 2017 file photo, Senate Health, Education, Labor, and Pensions Committee Chairman Sen. Lamar Alexander, R-Tenn., accompanied by the committee's ranking member Sen. Patty Murray, D-Wash. speaks on Capitol Hill in Washington. Millions of people who buy individual health insurance policies and get no government help for premiums are facing another year of double-digit premium increases and frustration is boiling over. (AP Photo/Alex Brandon, File)

— Millions of people who buy individual health insurance policies and get no financial help from the Affordable Care Act are bracing for another year of double-digit premium increases, and their frustration is boiling over.

Some are expecting premiums for 2018 to rival a mortgage payment.

What they pay is tied to the price of coverage on the health insurance markets created by the Obama-era law, but these consumers get no protection from the law's tax credits, which cushion against rising premiums. Instead they pay full freight and bear the brunt of market problems such as high costs and diminished competition.

On Capitol Hill, there's a chance that upcoming bipartisan hearings by Sens. Lamar Alexander, R-Tenn., and Patty Murray, D-Wash., can produce legislation offering some relief. But it depends on Republicans and Democrats working together despite a seven-year health care battle that has left raw feelings on both sides.

The most exposed consumers tend to be middle-class people who don't qualify for the law's income-based subsidies. They include early retirees, skilled tradespeople, musicians, self-employed professionals, business owners, and people such as Sharon Thornton, whose small employer doesn't provide health insurance.

"We're caught in the middle-class loophole of no help," said Thornton, a hairdresser from Newark, Delaware. She said she's currently paying about $740 a month in premiums, and expects her monthly bill next year to be around $1,000, a 35 percent increase.

"It's like buying two new iPads a month and throwing them in the trash," said Thornton, whose policy carries a deductible of $6,000. "To me, $1,000 a month is my beach house that I wanted to have."

A suggestion that she could qualify for financial assistance by earning less only irritates her more. "My whole beef is that the government is telling me: 'If you work less, we'll give you more,'" said Thornton, who's in her 50s.

If people such as Thornton drop out, they not only gamble with their own health. Their departure also means the group left behind gets costlier to cover as healthier customers bail out. That's counter to the whole idea of insurance, which involves pooling risk.

It wasn't supposed to be this way.

Buying health insurance has always been a challenge for people getting their own policies outside the workplace. Before "Obamacare," insurers could turn away those with health problems or charge them more. Former President Barack Obama sold his plan as the long-awaited fix.

It would guarantee coverage regardless of health problems, provide tax credits and other subsidies for people of modest means, and generate competition among insurers to keep premiums in check for all. The overhaul sought to create one big insurance pool for individual coverage in each state, no matter whether consumers bought plans through or traditional middlemen such as insurance brokers.

But an influx of sicker-than-expected customers drove up costs for insurers, while many younger, healthier people stayed on the sidelines. Political opposition from Republicans complicated matters by gumming up the law's internal financial stabilizers for insurers.

The result was a 25 percent average increase in the price of a midlevel plan on heading into this year. Many states expect a similar scenario for 2018, but this time insurers say uncertainty about the Trump administration's intentions is driving up their bids ahead of the Nov. 1 start of open enrollment.

About 17.6 million people buy individual health insurance policies, and half of them get no subsidies under the law, according to estimates by the nonpartisan Kaiser Family Foundation. The number of unsubsidized customers with ACA plans outside the health insurance marketplaces dropped by 20 percent this year, after the big premium increases.

"The unsubsidized part of the market outside the exchanges has shrunk noticeably as premiums have increased," said Kaiser's Larry Levitt. "It's likely that the people dropping out of the market are healthier overall. So the pool has potentially deteriorated."

It's time to shift focus in the health care debate, said Sen. Alexander, chairman of the Senate Health, Education, Labor and Pensions Committee, which plans hearings beginning this coming week.

"The people who are really getting hammered — they are the ones we need to help," said Alexander, R-Tenn. "We've got a few weeks to come to consensus in this seven-year-old partisan stalemate and if we don't break it, some people will be priced out and badly hurt."

Alexander envisions limited legislation that guarantees disputed subsidies for copayments and deductibles another year, while giving states more leeway to design less-costly plans. Democrats are looking for financing to help insurers with high-cost cases. Experts say that guaranteeing the subsidies should lead to an immediate cut in premiums in many states.

Thornton, the Delaware hairdresser, said she doesn't know what to believe anymore. She said she voted for Donald Trump — her first time for a Republican — partly out of frustration with her health care costs.

"I'm ready to stomp on the White House lawn," she said. "I am fuming."


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  • Kevin O'Donnell Sep 4, 3:45 p.m.
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    On the campaign trail last year, Bill Clinton mentioned those of us in the middle. His suggestion was to put high risk folks in a high risk pool and then increase Medicaire tax on everyone to pay for their health care. That makes sense to me. Right now, those of us that do not get subsidies are paying for those that do get subsidies. Employees of corporate America and government are not sharing in the pain as they have their own pools.

    In the meantime, I wish Congress would move the short-term plan limits back to one-year as opposed to 3 months. This lower plan term is a change Obama made right before leaving office. Blue Cross then realized it had a clear path to terminate the grandfathered plans and jack up rates to those of us in the middle.

  • John Archer Sep 4, 12:46 p.m.
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    View quoted thread

    Again, you can blame the GOP. They would not pass single payer, wouldn't even consider it for a vote. The ACA has helped 20 million people get insurance that didn't have it before. Do you not remember all the millions of stories of people who couldn't afford to go to the doctor, who went to the ER for the flu? It has helped tremendously, but Congress (both sides, I agree) have weakened the ACA to the point that many people are worse off. The answer is to FIX what's broken, not make it even worse.

  • Bob Bucy Sep 4, 11:50 a.m.
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    So the Democrats and Obama have no responsibility for any of this? Anybody remember that we were all supposed to save $2,500 a year on our health insurance? The ACA was simply a power grab designed to push the country toward single payer health care, and it is doing exactly as it was intended. It was never about helping the uninsurable. If that were the true motivation, then it may have been better to just move all of them to medicare and raise the medicare tax accordingly to pay for it. I believe that it would have cost us all far less than the ACA monstrosity.

  • John Archer Sep 4, 11:43 a.m.
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    You can blame the GOP for every one of these problems. They have been gutting the ACA since they passed it. Premiums go up because insurance companies aren't making a big enough profit.

  • Sharon Johnson Sep 4, 10:26 a.m.
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    Yes, make fun of a very serious issues that's what #### do. I retired early because of health problems. Do not receive disability. I am on ObamaCare and pay Blue Cross $740 a month. Without ObamaCare I would be
    paying $1040.00 a month. Next year I look at not having medical coverage because I do not have the income to pay $1000 or more a month.

  • Jeff Freuler Sep 4, 10:18 a.m.
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    yep...... I know lots of folks that had to cancel their insurance because the premiums got to the point they couldn't afford it

  • Kevin O'Donnell Sep 4, 9:43 a.m.
    user avatar

    Blue Cross dumped my grandfathered plan. My premium and deductible is going from $19,000 per year to over $40,000 per year. Dems created this mess. Repubs won't fix it. Those of us in the middle have no representation and are getting hammered.