North Carolina ‘worst off’ in impact of Obamacare on insurance rates

by Mitch Kokai, The Locker Room, September 25, 2013.

Less than a month after data from the Manhattan Institute prompted Carolina Journal to report that Obamacare could lead to 80 percent premium increases for many North Carolina health insurance customers, MI’s Avik Roy offers an even more shocking assessment for Forbes of Obamacare’s impact on the Tar Heel State.

Based on a Manhattan Institute analysis of the HHS numbers, Obamacare will increase underlying insurance rates for younger men by an average of 97 to 99 percent, and for younger women by an average of 55 to 62 percent. Worst off is North Carolina, which will see individual-market rates triple for women, and quadruple for men. [Emphasis added.]

Roy goes on to explain how he and his colleagues made their assessment.

We look at rates for 27, 40, and 64 year olds; and rates for men and women. (Under Obamacare, rates for men and women are the same, which has the net effect of disproportionately increasing rates for men, who generally paid less under the old system.) The HHS report offers rates for 27-year-olds; and rates for the average-aged exchange participant, a figure that varies by state, but seems to generally land in the mid-thirties.

So, we conducted two comparisons between pre-ACA data and post-ACA data, as reported by HHS. The first comparison is between the cheapest plan available to 27-year-olds pre- and post-Obamacare. The second is between the cheapeast plan available to the average exchange participant, and to the typical 40-year-old pre-Obamacare. We would have liked to have compared rates for older individuals, but HHS didn’t report that data.

Follow the link above to see charts for 40-year-old men and women. The information is no better for Tar Heels.

But what about the taxpayer-funded subsidies designed to offset these rising costs? (One can picture the News & Observer trying at this moment to put lipstick on the pig.) Here’s Roy’s response:

All of the analyses I’ve discussed thus far involve changes in the underlying cost of health insurance for people who buy it for themselves. Many progressives object to this comparison, because it doesn’t take into account the impact of Obamacare’s subsidies on the net cost of insurance for low-income Americans.

I’ve long argued that it’s irresponsible to ignore the change in underlying premiums, because subsidies only protect some people. Middle-class Americans face the double-whammy of higher insurance premiums, and higher taxes to pay for other people’s subsidies. However, it is important to understand how subsidies will impact the decisions by Americans as to whether or not to participate in the exchanges. …

… Here’s the bottom line: most people with average incomes will pay more under Obamacare for individually-purchased insurance than they did before.