Healthcare Premiums Set To Increase By 22% in 2017 under Obamacare

Recently, it was confirmed by the U.S. administration that the premium for affording healthcare insurance under President Obama’s signature Affordable Care Act, more commonly referred to as Obamacare will increase by 22% from the next financial year. It is a substantial increase compared to 7.5% increase in premium from 2015 to 2016 and is being viewed by many as yet another setback for the controversial act.

Insurers, who sell their healthcare insurance plans and products through the government owned website healthcare.gov, will increase their insurance premiums by a whopping 25% on average while the average for all insurance market places will stand at 22%. It has been confirmed in a report by the U.S. Department of Health and Human Resources (HHS).

Enrollment for plans begin on November 1st, 2016

Enrollment for health insurance plans for 2017 will begin on November 1st this year. You will have to select a plan and then communicate the same to your insurer by December 15th, 2016. The last date for registration for the 2017 insurance is January 31st, 2017.

The department of HHS has predicted that at least 70 per cent of the Americans who opt for Obama’s Affordable Care Act would get health plans which come for $75 per month and people who choose low-cost plans with limited benefits can reduce their burden further due to availability of subsidies under the act.   

People, who had previously brought plans through state exchanges, can also save money by shifting to a low-cost plan within the same level of coverage for which they were previously insured.

Major health insurers pulling out of key markets

According to a report published by ABC News, health insurers like Aetna and United Healthcare have pulled out of some market places and in five states, there will be only one insurer that might drive up the prices of health plans due to absence of competition. People in these states may be compelled to switch to different plans or pay higher premiums.    

HHS secretary thinks insurers’ move “adaptive” in nature

HHS secretary Sylvia Mathews Burwell has said that the insurers are taking time to adapt from pre-Obamacare scenario to now where insurers are not looking for the fittest and healthiest customers but looking out for quality customers.

Under this new act, insurers who participate can’t differentiate between customers with a known history and those who don’t. They can’t deny or charge higher premiums to these customers simply because they have a known history of a particular illness, protecting everyone’s right to get insured.

What is the impact?

Experts feel that the frivolity of the act is now becoming evident as turnover for most insurers are taking a hit. According to the same ABC news report, patients in the top 5% of healthcare spending bracket are also the ones who account for 49% of the total healthcare expenditure. Companies had last year predicted the amount and number of claims incorrectly and had also set the premium too low.

However, the Obama administration has assured that enough state subsidies would be doled out in 2017 to keep the plans affordable. HHS has also requested people to visit the healthcare.gov website in order to choose the right plans.

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