Preliminary analysis show sharp hikes
Michigan media reports are full of happy talk related to information released by the U.S. Department of Health and Human Services on individual insurance rates available on the Obamacare “exchange.”
Specifically, the law’s cheerleaders are boasting that rates here will be “less than the national average.”
Note what the reports are not saying: The exchange rates appear to be much higher than rates for individual insurance policies available before the law goes into effect.
According to preliminary analysis by Manhattan Institute scholar Avik Roy, the cost of the cheapest policy available to a 27-year-old Michigan man or woman will be 166 percent and 167 percent higher, respectively, compared to the cheapest rate available before the law goes into effect. For 40-year-old men and women, the cheapest rates will be 76 percent and 131 percent more, respectively.
Says Roy: “In both the 27-year-old and 40-year-old comparisons, we adjusted the pre-ACA rates to take into account people who would be charged more for insurance, or denied coverage altogether, due to a pre-existing condition, using the same methodology we’ve used in the past.”
Moreover, for most people the subsidies issued through the exchange will not compensate for the higher prices. In other words, most individuals will pay more even after getting a taxpayer funded subsidy, if they are eligible. Those who are not eligible will be even worse off.
Nationwide, “Obamacare will increase underlying insurance rates for younger men by an average of 97 to 99 percent, and for younger women by an average of 55 to 62 percent,” reports Roy.
Read more about rate increases in Michigan and elsewhere in Avik Roy’s article in Forbes.