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Democrats new Argument: Doubling Insurance rates is a Good Thing

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Very well written article at Forbes, which of course no one on the left will bother to read.




Well, its been an interesting week in health care land. For a while now, independent analystsand conservative criticshave raised concerns that Obamacare will dramatically increase the cost of individually-purchased health insurance for healthier people. This would, of course, contradict President Obamas promises that if you like your plan, you can keep it and that the cost of insurance would go down by $2,500 per family per year. Whats new is that liberal columnists, facing reality, are conceding that premiums will go up for most people in the individual market. But theyre justifying it by saying that rate shock will help a tiny minority of people who cant get insurance today. If they had said that in 2009, would Obamacare have passed?


Last month, progressive pundits were trumpeting news out of California that the cost of health insurance under Obamacare in that state was surprisingly low. Well, the California bids are in, wrote Paul Krugman on May 27. And the prices, it turns out, are surprisingly lowSo yes, it does look as if theres an Obamacare shock coming, the shock that Obamacare will work just fine.


It turns out, however, that Krugman was uncritically regurgitating Californias misleading press release. In fact, the average 25 and 40-year-old will pay double under Obamacare what they would need to pay today, based on rates posted at eHealthInsurance.com (NASDAQ:EHTH). More specifically, for the typical 25-year-old male non-smoker, the average Obamacare bronze exchange plan in California will cost between 64 and 117 percent more than the cheapest five plans on eHealth. For 40-year-old male non-smokers, its between 73 and 146 percent more.


Ezra Klein of the Washington Post, in response to my article on this topic, checked out the eHealth rates for plans in his hometown of Irvine, California, and compared them to a similar website sponsored by the government at healthcare.gov. He found that the third-cheapest plan there cost only $109 a month, if theyll sell it to you for that price. According to the government, Ezra notes, 14 percent of people who tried to buy that planHealth Nets IPF PPO Value 4500were turned away. Another 12 percent were asked to pay more than $109.


...In Orange County, where Irvine is located, the three-fourths of the 25-year-old population that is in good health will have their premiums jacked by 95 percent.


And thats for Obamacares catastrophic coverage; the more comprehensive bronze plan increases premiums by 130 percent. For the fractionone-eighth of the totalwho, under the old system, would have been charged more, the premium increase due to Obamacare will be somewhat less.


And the vast majority of those who were turned away are able to find insurancealbeit at a higher priceelsewhere. Based on enrollment in Obamacares high-risk pool program, the number of people in America who are truly uninsurable is closer to 150,000. Thats a pretty small number in a nation of 300 million. Previous estimates of the uninsurable population came in around 2 to 4 million people, but its likely that for many of these individuals, the principal problem is not that theyre denied coverage, but that the premiums are high.

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