Republicans Question HHS Report On Obamacare Premium Increases
(Washington Free Beacon) – The Department of Health and Human Services (HHS) acknowledged that premiums for the most popular Healthcare.gov plans would slightly increase in 2015, in a report released on Thursday and first reported by the Associated Press.
“Premiums for the benchmark (second-lowest cost) silver plan will increase modestly, by 2 percent on average this year before tax credits, while premiums for the lowest-cost silver plan will increase on average by 5 percent,” the report notes.
Republicans are questioning those numbers and sources tell the Washington Free Beacon they are looking into it, but believe the numbers are inaccurate because the administration has “reworked” parts of the plan to produce a smaller increase in premiums.
“We think the increase wasn’t bigger because it’s likely they have reworked the elements of the plans. We’re more interested in how the deductibles or benefits have changed inside those plans to keep it to just [a five percent] increase,” a top Senate aide told the Free Beacon.
“What we’ve been anecdotally hearing about are really huge deductibles, more constriction of the networks, and different levels of co-pays for drugs in order to [keep] premium increases to a minimum.”
A second Senate aide, who works closely on health policy, echoed that perspective and told the Free Beacon that the report has many “holes” which suggest the cost of insurance hasn’t declined in marketplace plans.
Ultimately the aide said, the five percent increase is a “floor, not a ceiling” and “the administration only got [it] so low because they provided a bailout backstop for the insurers.”
“Further, those individuals who needed coverage last year have bought it, meaning this years pool of individuals purchasing coverage will be healthier … than last years pool. It is unlikely we will see a similar set of circumstances in the 2016 open enrollment period, meaning the 5 percent rate increase is the lowest we can expect or hope for.”
The administration argues that premium increases are “modest” and they encourage current customers to shop around in order to “find the best plan that best meets their needs and budget.”
An HHS official told the Free Beacon, “this increase is quite meager in absolute terms. It is similar to the rate of inflation economy-wide and actually smaller than the increase in employer premiums in 2014 (as measured by one leading indicator), which was itself tied for the smallest increase on record.”
HHS Secretary Sylvia Burwell said in a statement the findings in Thursday’s report show that “consumers have affordable choices for renewing their coverage and signing up for the first time.”
The report found that while some premiums will increase, the majority of consumers currently enrolled in marketplace plans “can get coverage for $100 or less for 2015, after tax credits,” particularly if they shop around.
HHS officials who spoke with the Free Beacon maintain that the market is better now than it was before the law.
“Before the ACA, consumers in the individual market regularly saw double digit rate increases on average, with very limited options for shopping around because plans could deny them coverage or charge them higher rates based on pre-existing conditions,” a spokesman said. “By contrast, this year they are guaranteed the ability to renew their current plan, if it is available, or shop for the plan that best suits their needs and their budget.”
However, Republicans in the House say that the five percent increase is further evidence that the Affordable Care Act is hurting the pockets of middle class Americans and that it is not what President Obama promised.
In a statement provided to the Free Beacon Chairman of the House Oversight Committee Rep. Darrell Issa (R., Calif.) said, “This is yet another broken promise from this administration, who famously touted lower premiums under Obamacare. We now know that simply wasn’t true.”
Senator-elect Tom Cotton (R., Ark.) gave a similar statement, calling the law a “bait and switch.”
“The Obama administration seems to have pulled the ultimate bait and switch. What’s worse, both they and insurance companies knew this would happen all along, yet provided no warning,” Cotton said.
“Now hundreds of thousands of Americans are about to learn the hard way that Obamacare isn’t what the president promised it would be. Obamacare is an unworkable law, and today’s announcement underscores the need for actual free-market reforms to our healthcare system that would increase competition and lower costs.”
One congressional aide said the administration’s track record should give everyone pause when considering the latest numbers.
“I’d also point out that HHS is currently under scrutiny for reporting inflated Obamacare enrollment numbers to Congress,” the aide said, “and that CMS Administrator Marilyn Tavenner and Jonathan Gruber are set to testify before the Oversight Committee on Tuesday, Dec. 9.”
HHS did not respond to additional requests for comment by press time.