Obamacare premium costs will soar 20.3 percent on average in 2016 instead of the 7.5 percent increase claimed by federal officials, according to an analysis by The Daily Caller News Foundation.
The discrepancy is because the government excluded price data for three of the four Obamacare health insurance plans when the officials issued their recent forecast claiming enrollees would face only a 7.5 percent average rate increase in 2016.
When data for all four plans are included, premium costs will actually rise on average 20.3 percent next year. The 2015 Obamacare price hike was 20.3 percent.
The Obamacare program’s federal exchange operates in 37 states where officials declined to set up state-run exchanges. Officials in the U.S. Department of Health and Human Services Center for Medicare Services, which manages Obamacare, only calculated price changes for the health insurance program’s Silver plan, thus ignoring data for the Bronze, Gold and Platinum plans.
The CMS officials said they did so because the IRS uses the Silver plan as a “benchmark” for tax purposes. That approach, however, gave consumers an incomplete picture of what is happening in the health insurance marketplace through the Obamacare program.
The DCNF analysis reviewed price data for all four plans obtained from CMS, insurance companies, state insurance regulators and the nonpartisan National Conference of State Legislatures.
The 20.3 percent figure is the average for all plans. Premium increases in some states will be much higher. In Utah, for example, some enrollees in an individual plan will face a 45 percent price jump. In Illinois, the highest price hikes for individuals in the federal exchange will be 42.4 percent. Some insurers in Tennessee will experience a 36.3 percent price rise.
Wayne Winegarden, a senior fellow in business and economics at the Pacific Research Institute, told TheDCNF that CMS 7.5 percent forecast number is “misleading and a meaningless statistic” that “isn’t actually relevant to any individual in any state. If you go across the four different metals, what happened in the Gold plan, what happened in the Platinum plan, what happened to the Bronze plan?”
Charles Gaba, a data analyst who tracks Obamacare trends and is an Obamacare supporter, reported earlier this year that Obamacare consumers in all 50 states will experience an average 14.4 percent increase. His analysis can be found on his web site, acasignups.net.
“I was hoping they would include all of the rates,” Gaba told TheDCNF. “I would love it ideally if they had all the medal levels.”
Gaba called the CMS price analysis, “fairly representative, but there’s the Gold, the Platinum, the Bronze, the catastrophic plan even, and there’s also a variety of Silver plans. So there are a bunch of different ones in addition to the benchmarks which they did not include.”
The difference between premium cost projections based only on the Silver plan and those that result from using all four plans can be dramatic. Silver enrollees in Pennsylvania, for example, will experience a 10.6 percent increase. Using all four plans, the average price hike for Obamacare enrollees is 20.3. Time Insurance Co. pulled out of Obamacare after state officials rejected its 61 percent increase request.
South Dakotans using Silver will pay 24.7 percent more this year. But among all exchange users in the state, the average increase will be 39 percent. Dakota Care hiked its Obamacare exchange prices 63 percent for 2016, while Blue Cross Blue Shield raised its rates by 43 percent.
In South Carolina, the Silver increase will be 10.8 percent, compared to 23.4 percent when all four plans are considering.
Some worrisome trends appear when specific Silver plan offerings are measured against other medal levels. The National Conference of State Legislators has begun tracking Obamacare price hikes by levels.
In Colorado, for example, Silver customers will see a 12.94 percent price hike. But Gold users will face a 20.33 rate increase and Platinum enrollees will see a 29.80 percent price rise, according to NCSL data.
Idaho Silver customers will have an 8.69 percent increase. But Bronze customers will face 11.03 percent rise and Gold will face 15.9 percent, according to NCSL. Idaho did not offer Platinum coverage for 2016.
The mainstream media was quick to embrace the 7.5 percent number, claiming it reflected the real- world experience of most Obamacare customers. The Washington Post’s Amy Goldstein reported in a story filed last Saturday that “the [CMS] analysis includes all plans being sold in the 37 states that will continue to rely on the federal exchange next year.”
In fact, Platinum, Gold and Bronze price changes were excluded from the federal analysis.
Thomas Miller a resident fellow at the American Enterprise Institute, told TheDCNF that CMS is “always trying to put the best face on things going forward.” But, he said, “you got your initial press release. Only a few people catch up with what might be the final results.”
Emma Colton contributed to this story.
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