Health Plan Cost for New Yorkers Set to Fall 50% – NYTimes.com

2013

Health Plan Cost for New Yorkers Set to Fall 50%

Individuals buying health insurance on their own will see their premiums tumble next year in New York State as changes under the federal health care law take effect, Gov. Andrew M. Cuomo announced on Wednesday.

State insurance regulators say they have approved rates for 2014 that are at least 50 percent lower on average than those currently available in New York. Beginning in October, individuals in New York City who now pay $1,000 a month or more for coverage will be able to shop for health insurance for as little as $308 monthly. With federal subsidies, the cost will be even lower.

via Health Plan Cost for New Yorkers Set to Fall 50% – NYTimes.com.

WOW! What a headline. Of course if you read the full article you find these supposed premiums affect only 17,000 people in New York, a state with over 2 million uninsured. You must also consider the announcement comes from a Democratic governor and his administration.

Much of the credit for this amazing accomplishment for Obamacare is given to the old standby “competition.” Somehow now that there are a few more insurers selling in the New York health insurance exchange all the logical factors determining the cost of health care are out the window.

Officials at the state Department of Financial Services say they have approved 17 insurers to sell individual coverage through the New York exchange, including eight that are just entering the state’s commercial market. Many of these are insurers specializing in Medicaid plans that cater to low-income individuals.

I look at this story and think to myself, how bizarre and then I ask how can journalists report this dribble without asking some important questions?

For example:

If insurers were charging premiums that amount to fifty percent more than necessary, what were the State insurance regulators doing all these years to allow that to happen?

Exactly how does diluting the negotiating power of insurance companies for provider fees by adding more insurers in an area translate into premium reducing competition?

And if competition is so powerful why haven’t the eleven existing insurers been competing all along and why don’t consumers always seek the lowest cost plan?

Are we comparing apples to apples or are we talking about lower value plans or more likely plans with small, tightly controlled networks of participating providers giving individuals a very limited selection of doctors?

You don’t have to be blindly opposed to or in favor of Obamacare to ask prudent questions for the claims made against it or on the Law’s behalf. In this case the headline and portions of the article are simply misleading creating the impression that the Affordable Care Act is working to lower premiums for Americans. In fact, we are talking about a small slice of America affected by the exchanges. For the rest of us, there is more in Obamacare that raises costs for all the parties involved in the health care system, including employers, that will eventually lead to higher premiums and payroll deductions all around.