Implode

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 A new study shows that the average increase for low-cost ObamaCare plans in 2017 will be 11% — which is twice the rate from last year. Will the “rate shocks are a myth” crowd finally admit it's wrong?

The latest annual report on ObamaCare rates from the Kaiser Family Foundation looks at premium increases for the lowest-cost Silver plan in 14 cities. What it found is that the weighted average premium increase will be 11% for these plans.

Premiums for these plans will go down in just two markets -- Providence and Indianapolis -- but up as much as 26% in Portland.  Kaiser also found that premiums for the second-cheapest Silver plan in these markets will climb an average 10%.

These rate spikes are especially important because Silver plans are the ones most people enroll in.

Kaiser also found that the average number of insurers in these markets will have dropped from 6.4 in 2015 to 5.5 next year.

 

Less competition and higher premiums are the exact opposite of what ObamaCare backers promised.

The Kaiser report is just a sampling, but there is plenty of other evidence that the pain of higher premiums and fewer choices will be felt across the country when people go to sign up for insurance this fall.

 Jed Graham found that major insurers offering ObamaCare plans in 30 states have put in for average rate hikes of 25%. Humana (HUM), for example, is seeking premium hikes of more than 38%, with UnitedHealth  (UNH) at 25% and Anthem (ANTM) 21%.

The average weighted rate hike tops 56% in Tennessee. In Oklahoma it's 53%, and Iowa 32%.

These are increases that, before ObamaCare, were cited as a reason for ObamaCare. Now, Obama and company dismiss these magnificent hikes as no big deal.

First, backers say, people can choose a different insurer and possibly keep rates down. Except that doing so can be highly disruptive, since plan switchers will often end up facing a much higher deductible, and might have to switch doctors as well. In other words, they will not only have to drop a plan they like, but doctors they like, too.

Plus, competition in the exchanges is dwindling. People living in three states -- Alaska, Alabama and Wyoming -- as well as those in hundreds of counties across the U.S. will have only one insurance company from which to "choose." More than half the counties will have two at most.

Next, ObamaCare backers say, higher rates don’t matter because most people buying in the ObamaCare exchange are getting generous subsidies so they won’t feel much of the sting of these rate hikes.

Except, as industry analyst Robert Laszewski points out, “half of the individual market does not get a subsidy,” which means half the market will face the full brunt of these rate hikes. And, since the subsidies phase out as income goes up, there will be plenty of middle income families stuck with huge premium increases they can't afford.

Finally, ObamaCare supporters say that big rate hikes are to be expected in the short term, as insurers figure the market out. But fear not, sometime down the road premiums will stabilize and all will be well.

That’s a bit like reassuring passengers on the Titanic that the sinking will stabilize once the ship takes on enough water.

ObamaCare's government-created insurance markets aren't stabilizing. They are getting worse. No matter who the next president is, he or she is going to have to deal with this mess.

Jed Graham:

 

[Momorider]

Unmitigated failure