Actuaries and insurance companies are warning of high premiums for 2014, mostly in the exchanges, small group and individual markets. These costs are being driven by claims, the changes required by Obamacare and new fees and taxes.
But such suggestions are being dismissed by the Administration, for example:
The Obama administration challenged the design of the study, saying it focused only on one piece of the puzzle and ignored cost relief strategies in the law, such as tax credits to help people afford premiums and special payments to insurers who attract an outsize share of the sick.
The study also doesn’t take into account the potential price-cutting effect of competition in new state insurance markets that will go live Oct. 1, administration officials said.
Let’s see, politicians say an actuarial study is flawed because the high costs are offset by federal tax credits … seriously? Costs are ok because the government is subsidizing premiums? How about we focus on total costs?
And then we are told competition among insurance companies will take care of the problem. Again, seriously? First of all competition of this kind is counterproductive. Plus there is already competition among insurers, so why doesn’t that hold down costs? Someone should tell Sebelius that insurers may choose not to participate in certain exchanges if they believe they will lose money in the process, and HHS is setting that up to happen.
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