If you don't recognize there's something inherently cockeyed about the federal government passing a law that presumes to make a product or service "affordable," then you don't understand how market forces work. I'll oversimplify it for the purpose of brevity: Providers have to price a product or service in a way that reflects the cost of providing it, as well as the level of demand for it, because if they don't they will soon find themselves incapable of meeting the demand.
The premium rates announced when ObamaCare went into effect were much higher than Obama promised in trying to sell the law. The $2,500 per family premium cut was always a fantasy. Premiums went up, not down. But they didn't go up as much as you might expected considering the law mandated that people buy the service, and that pre-existing conditions be rendered irrelevant both to acceptance and to premium pricing (not to mention the premium nature of coverage).
Those factors make health insurance much more expensive to provide, and the only reason that wasn't reflected in an immediate explosion of premium rates was that these rates were politically manipulated in the early going. If you understood basic economics, you know that it was only a matter of time before premiums would adjust to reflect the reality of ObamaCare.
And time's up, as the Daily Signal reports:
“This is going to be a phenomenon of insurers that priced more optimistically instead of defensively,” Ed Haislmaier, a senior research fellow in health policy studies at The Heritage Foundation, told The Daily Signal of providers with hefty rate increases.
Perhaps the most drastic rate hike comes from New Mexico, where Health Care Services Corp. requested a 51.6 percent increase to premiums. The rate hike must be approved by the state.
In Maryland, according to the state’s Insurance Administration, CareFirst BlueCross BlueShield proposed premium rate increases of up to 30 percent in the individual market for 2016.
“CareFirst has predicted for some time that rates would need to climb from artificially lower levels due to the characteristics and needs of the population that has actually enrolled,” the company said in a statement.
Exactly. You can't give everyone generous coverage, regardless of their health, and not see premiums soar. If you try, you will bankrupt the entire system. Democrats have gambled all along that voters wouldn't care about the eventual premium hikes because subsidies would soften the blow. King v. Burwell may complicate that belief in the short term, but even if the Supreme Court rules in favor of the administration and leaves the federal exchange subsidies in place, the budgetary implications on both ends will slap the public in the face before long.
Even if you're getting a subsidy, you're still going to pay more out of pocket. And the federal government can only soak "the rich" so much to get the money for this before they start coming after everyone else. You simply can't make something affordable just by passing a law declaring that it will be so. Economic forces always adjust to the attempted manipulation because they cannot do otherwise - no matter how hard politicians try to squash them. ObamaCare hasn't been in the news much lately, but that doesn't mean it's any less of a disaster. It just means the public is exhaling while it waits for the next reminder that this law has to go. And here it is.
If you don't recognize there's something inherently cockeyed about the federal government passing a law that presumes to make a product or service "affordable," then you don't understand how market forces work. I'll oversimplify it for the purpose of brevity: Providers have to price a product or service in a way that reflects the cost of providing it, as well as the level of demand for it, because if they don't they will soon find themselves incapable of meeting the demand.
