Premiums are rising. HHS Secretary Sylvia Burwell stated:
Building a new market is never easy,” she told the group at HHS headquarters. “We expect this to be a transition period for the marketplace. Issuers are adjusting their prices, bringing them in line with actual data on costs.”
Burwell’s comments foreshadow the higher premiums expected when federal officials release details on the health plans to be offered on HealthCare.gov for 2017. Those details are likely to come just days before a presidential election that could determine whether the ACA is repealed or revamped.
How will this affect enrollment? On the one hand, failing to buy insurance is now costly. Adults who do not buy insurance must pay a fine: or adults in 2016 is $695 or 2.5 percent of income, whichever is higher.
On the other hand, insurance premiums are much higher than $695 so the penalty may not have teeth. Further, as insurers leave the market, 1.4m patients will not able to renew their insurance. Now having access to multiple insurance option surely will reduce enrollment.
The Healthcare Economist will continue to keep an eye on Obamacare markets as enrollment number come in the fall and Q1 2017.