- The Washington Times - Wednesday, October 25, 2017

Benchmark Obamacare plan premiums will rise an average of 34 percent next year, according to an independent analysis Wednesday that suggests poor enrollment and market instability are sending rates skyrocketing.

The new numbers came as Congress debated the outlines of a rescue package, and the leading option — a bipartisan Senate bill — got a boost from budget scorekeepers who said paying billions of dollars in subsidies to insurance companies now will help keep premiums, and therefore taxpayer spending, lower in the long run.

The studies came even as the Trump administration geared up for the next round of Obamacare enrollments, which begins Nov. 1. The offerings available have already been loaded into HealthCare.gov, meaning customers in the 39 states that rely on the federal website can begin to window-shop.

Avalere Health, a D.C.-based consultancy, said consumers will see a significant rise in premiums for the benchmark mid-level “silver” plans, which have risen 34 percent. Shoppers who pick cheaper bronze plans or up-market “gold” plans will see rate hikes ranging from 16 percent to 24 percent.

The changes will vary by state, though, with customers in Iowa seeing a 67 percent increase, while Alaska will see an average decrease of 22 percent.

Many customers are insulated from the premium increases by taxpayer-funded subsidies that rise with rates. However, the trend exerts greater pressure on Uncle Sam to foot the bill.

Up to 9 million people who purchase insurance on their own, but do not qualify for assistance, must shoulder the full burden of rate increases.

Analysts blamed a range of factors, including the program’s inability to attract enough young and healthy customers, leaving insurers to grapple with a costly customer base.

The trend resulted in double-digit rate hikes this year and is fueling Republican efforts to repeal and replace the law, though Avalere says Mr. Trump’s ambivalence toward Obamacare is making the problem worse heading into 2018.

Mr. Trump recently canceled what’s known as “cost-sharing reductions” — federal money sent to insurers to reimburse them for covering out-of-pocket health care costs of lower-income Americans.

“Plans are raising premiums in 2018 to account for market uncertainty and the federal government’s failure to pay for cost-sharing reductions,” said Caroline Pearson, senior vice president at Avalere. “These premium increases may allow insurers to remain in the market and enrollees in all regions to have access to coverage.”

A coalition of Democratic-led states went to court to try to force Mr. Trump to continue making the payments, but they had their request tossed Wednesday.

U.S. District Judge Vince Chhabria, an Obama appointee, said the Trump administration appeared to have the better legal argument at this stage. He also said many of the complaining states had taken steps to insulate their residents from the fallout.

On Capitol Hill, Democrats and some Republicans are eager to restart the payments, pointing to the new Congressional Budget Office analysis that it would save money.

A bipartisan Senate bill would approve the cost-sharing payments for 2018 and 2019 — something Democrats want — while Republicans would secure greater flexibility for states that want to stray from Obamacare’s framework.

It would also let insurers offer catastrophic-only “copper” plans to anyone, not just customers age 30 or younger.

All told, the bill is estimated to cut deficits by nearly $4 billion through the coming decade, according to the CBO. Without the payments, the government would stand to pay $194 billion more over the next decade, because it would have to help Obamacare customers with higher premiums.

The deal negotiated by Sens. Lamar Alexander, Tennessee Republican, and Patty Murray, Washington Democrat, includes a provision that requires insurers to pay rebates to consumers and taxpayers, so they don’t “double-dip” by pocketing both the cost-sharing payments and higher-than-normal rates they submitted to make up for the missing cost-sharing money.

Mr. Alexander said the analysis proves his bill does not amount to a “bailout,” as House conservatives and Mr. Trump have charged.

Senate Minority Leader Charles E. Schumer says all 48 Democrats will support it on the floor, ensuring its passage alongside a dozen Senate Republicans who’ve sponsored the bill. He’s betting that Republicans will take the blame for higher premiums in 2018 and 2019, if GOP leaders don’t find a way to extend the cost-sharing payments.

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