It’s been well-documented that Americans in many states will see their health insurance premiums rise because of ObamaCare. Earlier this month, an analysis of eight states by the Wall Street Journal showed that people looking to by individual coverage can expect to see a 150% increase in premiums over what they would pay today.
But The New York Times reported yesterday that those with or looking to buy individual coverage in New York will see insurance premiums drop because of ObamaCare:
Individuals buying health insurance on their own will see their premiums tumble next year in New York State as changes under the federal health care law take effect, Gov. Andrew M. Cuomo announced on Wednesday.
State insurance regulators say they have approved rates for 2014 that are at least 50 percent lower on average than those currently available in New York. Beginning in October, individuals in New York City who now pay $1,000 a month or more for coverage will be able to shop for health insurance for as little as $308 monthly. With federal subsidies, the cost will be even lower.
Supporters of the new health care law, the Affordable Care Act, credited the drop in rates to the online purchasing exchanges the law created, which they say are spurring competition among insurers that are anticipating an influx of new customers. The law requires that an exchange be started in every state.
During yesterday’s debate over the delay of the employer and individual mandates, House Democrats frequently cited this story as proof that ObamaCare would bring down health insurance premiums.
There are huge caveats to this actually working, some of which The New Times Times noted in its story. The Empire State has one of the most heavily regulated insurance markets in the country, which Avik Roy called ObamaCare “on steroids.” That’s why health insurance coverage in New York has been so expensive.
The Obama Administration hopes that insurance premiums will fall because they anticipate that young people will purchase health coverage, thereby subsidizing those who are higher risk. But as the Wall Street Journal noted last month, there is no incentive for them to purchase health coverage because the individual mandate tax is substantially cheaper than insurance premiums.
So, basically, the picture that bureaucrats and The New York Times have painted is based on a rather rosy scenario that just isn’t likely to pan out and it’s certainly not indicative of most other states.