As early as 2007, President Obama promised that under his proposed health care reform law, insurance premiums would go down by $2,500 per year for the average family. To put it mildly, that hasn't happened under Obamacare -- and the rising rates are likely to increase again soon. According to a county-by-county analysis published last month by the Manhattan Institute, individual market insurance premiums have increased by 49 percent on average in 2014 after the most recent round of Obamacare regulations went into effect.
The increases were much worse in some places than others. The average 27-year-old man in Miami, for example, is now paying 59 percent more this year than in 2013; in Philadelphia, he's paying 68 percent more; in both Las Vegas and Little Rock, the rates for 27-year-old women more than doubled, and the rates for men of that age more than tripled. In North Carolina, rates for 64-year-old men and women nearly tripled as Obamacare took effect, requiring a more expensive and often unnecessary set of benefits.
|The average rate increase across the 16 states is 7 percent, but it varies by insurer and location within a state.|
That's a far cry from Obama's promise, and if the early data are any indication, it's about to get a bit worse for the residents of most states. As the Washington Examiner's Philip Klein noted recently, insurers are currently proposing new rates for 2015. PriceWaterhouseCoopers has released a study of the 16 states that have made insurers' filings public. Although a few of the insurers have announced they plan to bring rates down -- one of them by as much as 23 percent in Arizona -- the general trend is upward. The average rate increase across the 16 states is 7 percent, but it varies by insurer and location within a state. In Colorado, the rare state where Obamacare actually did bring down premium rates in its first year, insurers are now planning to claw back lost profits, with the result that some customers will face increases as high as 35 percent.
The highest proposed increase in Indiana is also 35 percent. As Klein notes, Hoosiers will soon pay, on average, about three times as much ($514 per month) for individual market insurance plans as they paid in 2013 ($174 per month). Although some low-income families will receive help from the federal government to pay these inflated prices, such subsidies only put taxpayers on the hook. Even worse, rates are only as low as they are now because insurers have narrowed their provider networks to the vanishing point -- in some states forcing patients to drive long distances for care.
This brings to mind one of Obamacare's most important lessons about government overreach. A simple expansion of Medicaid or a law assisting people who were uninsurable due to pre-existing conditions could likely have insured as many new people as Obamacare without being so unpopular. But Obama grandiosely insisted on the kind of “fundamental transformation” of American health insurance. That's why Obamacare has disrupted the already-insured and made health insurance significantly less affordable for millions of middle-class families.