Given the official name of ObamaCare, the Patient Protection and Affordable Care Act (ACA), one might think its purpose was, at least in part, to make healthcare affordable. If so, it has utterly failed, according to the latest Morgan Stanley survey of insurance brokers. That survey finds that individual and small-group insurance premiums, after falling for a few quarters, began climbing in late 2012 and are now increasing at double-digit — in some states, triple-digit — rates. What’s more, the financial-services company’s analysts place the blame for the rate hikes almost entirely on ObamaCare.
On a quarterly basis, Morgan Stanley has been canvassing brokers who sell coverage in the individual and small-group markets since 2011. Those surveys found that premiums rose by negligible amounts in early 2011 and then actually began falling by about one percent each quarter through the third quarter of 2012. Then, as the deadline for full ACA implementation approached, premiums began to rise — about two percent per quarter at first, considerably more quickly in late 2013, and now at rates of about 11 percent per quarter in the individual market and 12 percent per quarter in the small-group market.
The April survey of 148 insurance brokers “shows the largest acceleration in small and individual group rates in any of the 12 prior quarterly periods when it has been conducted,” notes Forbes’ Scott Gottlieb. And as bad as 11- and 12-percent rate hikes sound, he adds, “some state [sic] show increases 10 to 50 times that amount.” For instance, individual rates have risen by 28 percent in Pennsylvania, 53 percent in California, 90 percent in New Hampshire, and 100 percent in Delaware. Small-group rates, meanwhile, have increased by 23 percent in Nevada, 25 percent in both Maryland and Missouri, 34 percent in Indiana, 66 percent in Pennsylvania, and a whopping 588 percent in Washington.
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