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Health Law May Inflate Premiums for 11 Million Employees, Report Says

Health Law Cartoon by Angelo Lopez

Another wave of rate increases under Obamacare could hit 11 million workers at small businesses this time, but it could lower premiums for 6 million.

On Monday, the Centers for Medicare & Medicaid Services released estimates that reignited the GOP fight against the health law, despite considerable information gaps in the report. According to the report, rates are higher for some because premiums can no longer be based on a person’s age in the small group market.

Community rating, the equalizing factor for age, gender, and health status, has created higher premiums for younger employees and lower premiums for older ones, the CMS said.

However, the government’s estimates are based on many variables and the answers are far from concrete, especially because many small employers chose the early renewal option in 2013 to catch and extra year of reprieve from the Affordable Care Act’s requirements. Many insurers advised policyholders to early renew in order to avoid rate hikes beginning Jan. 1, 2014, when the ACA’s provisions kicked in, and both small businesses and individuals followed through.

The report only looks at three specific provisions of the law, including community rating. CMS says employers’ premium decisions will be based on more factors.

Regardless, vocal health law opponents were quick to fire off commentary.

“It’s clear why the administration sought to delay and deemphasize the release of this report. It undermines the central promise of the president’s health care law: affordable coverage,” House Speaker John Boehner said in a statement.

Forbes columnist Avik Roy wrote that “CMS’ projections almost certainly understate the problem, one that will begin to affect millions of workers in the second half of 2014.”

It’s unclear why the federal agency backing Obamacare would release uncertain estimates that make the health law look potentially worse, but other reports on the health law have been more promising.

Most of America has reached a “who cares” point, but some are still battling the federal healthcare website attempting to sign up in the rocky final weeks of enrollment.

We hope the current generation of HealthCare.gov contractors are managing that monster of code, as it’s continued to glitch for the past few weeks and consumers are hitting quite a few rough patches on the site. The site should brace itself for the traffic influx as the last-minute sign ups take place — but in Obamacare tradition, it’s likely to crash and lead to another delay.

Current enrollment figures stand at about… well, no one really knows for sure, but last time we heard it was 3 million or so. Despite the House passing legislation for the Obama administration to release weekly updates on the law, we’re not getting those updates.

The most recent report said 3.3 million have signed up for private health insurance coverage and 6.3 million have qualified for Medicaid since the exchanges opened, but it’s difficult to know how many were actually uninsured before that.

Officials say it will be while before accurate numbers are release, as it’s more complex than the amount of conversions received on a website.

“It’s going to take some time,” said Edwin Park, vice president for health policy at the Center on Budget and Policy Priorities. “I know everyone wants to know, ‘X percent was uninsured,’ but what we know so far is mostly anecdotal, and it’s probably not accurately capturing what’s going on.”

The numbers we have seen so far, such as the progressive drop in the uninsured rate, are very promising for the health law. Over the next few years, the amount of Americans without coverage will continue to decrease.

The CBO estimated that there would be 13 million fewer uninsured Americans this year between private individual coverage, and Medicaid and CHIP programs, and 25 million less in 2016.


B. Somers

B. Somers is a contributor to Health Insurance News, focusing on medical coverage, carriers, public programs and Obamacare. Writing for East Coast Health Insurance since 2012, she got started with healthcare and insurance news at its most exciting time in U.S. history.