Obamacare Premiums Are Going Up. Again. Now What?

If you haven’t been following the Obamacare news recently -- and given how much else has been going on, there’s a good chance you haven’t -- then you may have missed the news that insurers' rate-increase requests for 2017 are quite large. A new report from the Kaiser Family Foundation says the cost of the “benchmark” plan (the second-lowest-cost silver plan in a market, which is the price used to calculate subsidies) will go up 10 percent this year, double the rate at which prices increased last year. The lowest-cost silver plans are also seeing substantial hikes. This matters because these are the most frequently purchased plans.

The usual caveat applies to these preliminary requests: Regulators might not approve them. But that caveat was hauled out last year by the law’s supporters, who seemed to think that this was simply the opening stage of a negotiation in which insurers asked for the stars in the hope of settling on the moon. In fact, regulators approved large rate hikes, and the state of Oregon actually made some insurers raise rates by more than they’d planned. Regulators dislike high insurance premiums, of course, but they also dislike insurance companies suddenly going out of business and leaving their customers without insurance. They are not going to approve rates that they believe will cause insurers to lose large sums of money.