New study says Obamacare premiums will jump 34% in 2018 -- in large part because of Trump

  • A new study by healthcare consulting firm Avalere Health found that premiums for silver-level Obamacare plans would increase by 34% next year.
  • Avalere said the projected increases were due to changes from the Trump administration, enrollment adjustments, and insurer departures.
  • The study also found that most Americans in the exchanges would be insulated from the increases.

A new study projected that average premiums in the Affordable Care Act’s individual insurance exchanges will once again leap in 2018.

The study by healthcare consulting firm Avalere Health said that the average increase for the premiums of a silver-level plan would be 34% nationwide. That would be higher than the 25% increase in 2017.

According to Avalere, there are a few reasons for the projected increase:

  • President Donald Trump’s decision to halt so-called cost-sharing reduction (CSR) payments and Congress’ inability to appropriate them.
  • Lower enrollment than expected in the exchanges and insurer’s subsequent exits from the exchanges.
  • “Insufficient action by the government” to help offset losses by insurers, including the lapse of the reinsurance and risk corridor provisions.
  • “General volatility around the policies governing the exchanges.”

“Plans are raising premiums in 2018 to account for market uncertainty and the federal government’s failure to pay for cost-sharing reductions,” said Caroline Pearson, senior vice president at Avalere. “These premium increases may allow insurers to remain in the market and enrollees in all regions to have access to coverage.”

There would also be significant variation across states in the size of premium increases, or in some cases decreases, Avalere said.

“For example, Iowa will see the highest jump in average silver premium, 69%, over 2017, while Alaska will see a decrease in premiums for 2018, at -22%,” said the study.

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