If you like your Obamacare plan, you can keep it - for a much larger premium

"Consumers could be hit with major price increases, without even knowing it," writes Sam Baker in the National Journal. And folks, you ain't seen nothin' yet.

If you like your Obamacare plan, you can keep it—but you might end up paying a whole lot more.

People who decide to stick with the coverage they've already gotten through Obamacare, rather than switching plans, are at risk for some of the biggest premium spikes anywhere in the system. And some people won't even know their costs went up until they get a bill from the IRS.

Insurance plans generally raise their premiums every year, but those costs are just the tip of the iceberg for millions of Obamacare enrollees. A series of other, largely invisible factors will also push up many consumers' premiums.

In some cases, even if an insurance company doesn't raise its rates at all, its customers could still end up owing thousands of dollars more for their premiums. It's all a byproduct of complicated technical changes triggered, ironically enough, by the law's success at bolstering competition among insurers.

Many consumers will need to switch plans in order to keep their costs steady, but health care experts question how many people will do that. Switching plans can entail changing your doctor and adjusting to new out-of-pocket costs, never mind the fresh trek through HealthCare.gov. The White House has already set up an auto-renewal process, making it easier to stick with the status quo.

And with so many behind-the-scenes factors at play, most people might not even know that they need to go back through HealthCare.gov just to keep the deal they already have.

"A lot of people aren't going to understand this," said Susan Pantely, an actuary at the Milliman consulting firm.

Which may be the understatement of the century. Good thing our president waived his executive order magic wand and disappeared these increases until after the election.

First, there are the standard premium increases insurers seek from year to year. The lowest-cost plans in each state's marketplace were generally the ones that attracted the most customers in 2014. But in many cases, they're also the plans seeking above-average rate hikes.

This bait and switch tactic was understood from the beginning. It was a way to get insurers on board the exchanges and fool customers into signing up for the cheap plans.

But that's only part of the reason inertia is so expensive for Obamacare enrollees. The vast majority of enrollees don't pay the full cost of their premiums—85 percent are getting financial help from the government. And many of those consumers will find that their subsidies don't go as far next year, even for the same plans.

The size of each person's subsidy is tied to a "benchmark" plan. Poorer consumers only have to spend a certain percentage of their income for that plan; the government pays the rest of the premium. If you choose a more expensive policy, you have to pay the difference on your own.

This year, about 3.4 million people picked the benchmark plan or went one option cheaper. But as those plans raise their rates and new options come to the market, they'll often lose their benchmark status to cheaper competitors—and their customers will find themselves on the hook for a bigger share of their premiums.

"I would expect that probably the majority of 2014 enrollees are going to be impacted pretty substantially," said Milliman analyst Paul Houchens.

"These technical changes in subsidies could turn a 5 percent premium increase into a spike of 30 to 100 percent in the net costs for low-income consumers, writes Baker. So later this year when liberals are crowing about how little premiums have increased, you can smile to yourself and know that they're full of it.

Confusion, chaos, premium spikes, hidden costs - and always lurking in the background, is the IRS waiting to pounce:

The IRS will eventually figure out how much financial assistance you should have received, and will reconcile the difference on your taxes. If you should have gotten a bigger subsidy, the government will issue you a tax credit. If your subsidy was too big, which would be the case if you keep your plan and lower-cost options come to the market, you'll owe the IRS money.

Could it get any worse? Sure. You're company could decide to cut your hours back to part time status in order to avoid insuring you. Or your firm could dump their insurance plan altogether. Or, if you work at a company where employees pay part of their insurance costs, your share may go up substanitially.

As you can see, any Democrat running for office who claims all Obamacare needs is some "tweaks" and "quick fixes" is a liar. If possible, the whole thing should be scrapped. What should be a simple part of our lives - purchasing health insurance - has now turned into a gargantuan tangle of incomprehensible rules and regulations, not to mention stratospheric price increases.

Obamacare will go down in history as the nation's biggest boondoggle.

 

 

"Consumers could be hit with major price increases, without even knowing it," writes Sam Baker in the National Journal. And folks, you ain't seen nothin' yet.

If you like your Obamacare plan, you can keep it—but you might end up paying a whole lot more.

People who decide to stick with the coverage they've already gotten through Obamacare, rather than switching plans, are at risk for some of the biggest premium spikes anywhere in the system. And some people won't even know their costs went up until they get a bill from the IRS.

Insurance plans generally raise their premiums every year, but those costs are just the tip of the iceberg for millions of Obamacare enrollees. A series of other, largely invisible factors will also push up many consumers' premiums.

In some cases, even if an insurance company doesn't raise its rates at all, its customers could still end up owing thousands of dollars more for their premiums. It's all a byproduct of complicated technical changes triggered, ironically enough, by the law's success at bolstering competition among insurers.

Many consumers will need to switch plans in order to keep their costs steady, but health care experts question how many people will do that. Switching plans can entail changing your doctor and adjusting to new out-of-pocket costs, never mind the fresh trek through HealthCare.gov. The White House has already set up an auto-renewal process, making it easier to stick with the status quo.

And with so many behind-the-scenes factors at play, most people might not even know that they need to go back through HealthCare.gov just to keep the deal they already have.

"A lot of people aren't going to understand this," said Susan Pantely, an actuary at the Milliman consulting firm.

Which may be the understatement of the century. Good thing our president waived his executive order magic wand and disappeared these increases until after the election.

First, there are the standard premium increases insurers seek from year to year. The lowest-cost plans in each state's marketplace were generally the ones that attracted the most customers in 2014. But in many cases, they're also the plans seeking above-average rate hikes.

This bait and switch tactic was understood from the beginning. It was a way to get insurers on board the exchanges and fool customers into signing up for the cheap plans.

But that's only part of the reason inertia is so expensive for Obamacare enrollees. The vast majority of enrollees don't pay the full cost of their premiums—85 percent are getting financial help from the government. And many of those consumers will find that their subsidies don't go as far next year, even for the same plans.

The size of each person's subsidy is tied to a "benchmark" plan. Poorer consumers only have to spend a certain percentage of their income for that plan; the government pays the rest of the premium. If you choose a more expensive policy, you have to pay the difference on your own.

This year, about 3.4 million people picked the benchmark plan or went one option cheaper. But as those plans raise their rates and new options come to the market, they'll often lose their benchmark status to cheaper competitors—and their customers will find themselves on the hook for a bigger share of their premiums.

"I would expect that probably the majority of 2014 enrollees are going to be impacted pretty substantially," said Milliman analyst Paul Houchens.

"These technical changes in subsidies could turn a 5 percent premium increase into a spike of 30 to 100 percent in the net costs for low-income consumers, writes Baker. So later this year when liberals are crowing about how little premiums have increased, you can smile to yourself and know that they're full of it.

Confusion, chaos, premium spikes, hidden costs - and always lurking in the background, is the IRS waiting to pounce:

The IRS will eventually figure out how much financial assistance you should have received, and will reconcile the difference on your taxes. If you should have gotten a bigger subsidy, the government will issue you a tax credit. If your subsidy was too big, which would be the case if you keep your plan and lower-cost options come to the market, you'll owe the IRS money.

Could it get any worse? Sure. You're company could decide to cut your hours back to part time status in order to avoid insuring you. Or your firm could dump their insurance plan altogether. Or, if you work at a company where employees pay part of their insurance costs, your share may go up substanitially.

As you can see, any Democrat running for office who claims all Obamacare needs is some "tweaks" and "quick fixes" is a liar. If possible, the whole thing should be scrapped. What should be a simple part of our lives - purchasing health insurance - has now turned into a gargantuan tangle of incomprehensible rules and regulations, not to mention stratospheric price increases.

Obamacare will go down in history as the nation's biggest boondoggle.