by Mitch Kokai
Senior Political Analyst, John Locke Foundation
Under Obamacare, all Americans must have insurance coverage starting in 2014 or face penalties of $95 or 1% of family income, whichever is greater. Enrollment in the exchanges begins October 1, with coverage kicking in in January. Plans will come in four tiers, ranging from bronze to platinum.
Some lightly regulated states, including Indiana, Ohio, Florida and South Carolina, have recently released preliminary rate information highlighting steep price increases. Unlike the blue states of California and New York, these are Republican-led states that have strongly opposed the Affordable Care Act, as Obamacare is officially known. …
… Behind the numbers in 3 key states. In Florida, for instance, officials constructed a hypothetical silver-level plan based on the offerings available today. Then they looked at how the cost of that plan compares to the average silver plan that will be available on the exchange. Florida found premiums will rise between 7.6% and 58.8%, depending on the insurer. The average increase would be 35%.
The main driver of the premium increases is the Obamacare mandate that coverage be offered to everyone, said Kevin McCarty, Florida’s insurance commissioner. There are just short of a million enrollees in the individual market in Florida, while 3.8 million are uninsured. The state does not allow new entrants into a “high-risk pool,” which provides coverage to the sick.
“People who are in their 50s with high blood pressure have no coverage options,” he said.
Ohio, meanwhile, said there would be an average increase of 41% by comparing a trade association’s report of premiums for all plans available today with the average premium expected on the exchange.
Indiana officials said prices would rise an average of 72%. But they were looking at the cost of providing care, not actual premiums.
All of these rate hikes must still be reviewed by the federal government and do not take into account the fact that Americans with incomes up to $45,960 for an individual and $94,200 for a family of four will be eligible for federal subsidies.
A sidebar notes that the impact in North Carolina is harder to determine because of the N.C Department of Insurance’s decision to withhold some “trade secrets” associated with new ObamaCare health insurance plans.