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Obamacare’s Death Spiral: Double-Digit Cost Spikes, Disappearing Choices

President Barack Obama’s signature Obamacare healthcare law is offering Americans double-digit rate hikes and shriveled choices among fewer insurance companies in 2017.

“Consumers will be faced this year with not only big premium increases but also with a declining number of insurers participating, and that will lead to a tumultuous open enrollment period” for Obamacare before 2017, says Larry Levitt of the Kaiser Family Foundation.

The Obama administration confirmed Monday the sharp rise in planned premiums for 2017 and the fact that many Americans will have to choose plans from only one Obamcare insurer in their region, reports the Associated Press.

Consumers will see their premiums for a midlevel benchmark insurance plan jump an average of 25 percent in the states with exchanges run by the federal government, admits the Department of Health and Human Services (HHS).

In addition, 20 percent of Obamacare customers will be forced to choose from health insurance plans from only a single health insurance company, because big national carriers such as UnitedHealth Group, Humana, and Aetna have backed out of the program.

The number of health insurers on the federal exchange is dropping 28 percent, from 232 in 2016 to 167 next year. About 1.4 million Americans are expected to lose their current medical payment plans in 2017 as the companies flee Obamacare.

Though Obamacare’s mandate of coverage for pre-existing conditions has been popular, the healthcare reform’s staggering problems means that customers with chronic medical conditions will likely find switching insurers rather difficult and stressful.

“Enrollees may need to change doctors or drugs when they switch insurers,” said Caroline Pearson of the consulting firm Avalere Health.

The Obama administration is trying to put a positive spin on the bad news by arguing that taxpayer-funded subsidies for Obamacare customers will rise along with the premiums.

Obamacare essentially expanded Medicaid by increasing the number of people who are eligible for the federally funded program, most of the 10 million Obamacare customers who purchase their health insurance through healthcare.gov are actually on Medicaid and, thus, are eligible for more federal assistance.

“Enrollment is concentrated among very low-income individuals who receive significant government subsidies to reduce premiums and cost-sharing,” Pearson said.

However, about five to seven million Americans are either ineligible for subsidies or else purchase their health insurance policies outside of the exchanges, without subsidies.

President Barack Obama has tried to minimize the problems with his healthcare law, referring to them as “growing pains.”

As his presidency winds down, he has pushed for a government-sponsored “public option” – or Medicare for everyone – as a means to “fix” Obamacare. Democrat presidential candidate Hillary Clinton is now pushing that expansion of government-run healthcare.

However, Marilyn Tavenner, the former director of the Centers for Medicare & Medicaid Services (CMS) and official responsible for running healthcare.gov, says attempting to “fix” Obamacare by adding a public option would be “a huge mistake” that would only add “more bureaucracy and administrative cost” to healthcare.

“I think that the public option debate or even the consideration of yet another government-oriented program would be a huge mistake,” said Tavenner, who resigned her post in 2015 and is now CEO of America’s Health Insurance Plans (AHIP), the national trade association representing health insurance companies.

“If the program hasn’t stabilized in three years, it’s going to need some additional relief,” she said, hinting at a business push for more taxpayer-funded spending. “So I just think we need to solve the problem that we have versus chasing yet another program – adding more bureaucracy and administrative cost to the system.”

Obama has boasted that, as a result of his healthcare law, the nation’s uninsured rate has dropped below nine percent, many of those who now have an insurance card are finding themselves without actual coverage and real-life healthcare.

 

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