Mar 17, 2017
Facts Matter

Obamacare premiums spiked a lot in 2017

The issue:

Premium increases are central to the repeal debate. Republicans cite increases as evidence that the marketplaces are in a "death spiral"; supporters insist taxpayer-financed subsidies keep plans affordable and the spike was a one-time deal.

The facts:

Premiums for "benchmark" plans in Obamacare marketplaces increased by an average of about 22% for 2017, a big jump compared to average rate increases in 2015 and 2016 of 2% and 7%. And while almost three-quarters of enrollees can find a plan costing less than $75 per month, that means the government makes up the rest of the cost through subsidies.

Why this matters:

Though private analysts say double-digit spike was likely a one-time event — because insurers needed to make up for setting their premiums too low at first, and Obamacare's main risk mitigation programs have expired — the hikes gave the GOP new leverage to call for the gutting of Obamacare. As they carry out their plans to repeal and replace the law, they're countering accusations of creating chaos by saying the law was failing anyway. (Irony alert: it's now possible that premiums will increase again next year because of the uncertainty over Obamacare repeal.)

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