Affordable Care Act will lead to lower premiums, report states
Provisions put into effect by the Affordable Care Act will lower average healthcare premiums across the country, according to a report that was released by the U.S. Department of Health and Human Services and touted by the Obama Administration. The findings come amid attempts by the GOP to strike down the Act before it takes full effect over the course of the coming months. When compared with numbers released last year by the Congressional Budget Office, the study displays an almost 20 percent drop among premium prices.
"This is in line with what we've seen in other states, like California and Oregon," assured White House secretary Jay Carney, as quoted by Bloomberg. "Competition and transparency in the marketplaces, plus the hard effort by those committed to making the law work, are leading to affordable, new, and better choices for families."
Fixing a broken system
The study was based on 11 states that have made the related information available, and some in New York – one of the 11 that participated – are celebrating the results. According to an analysis of the findings from the New York Times, "individuals who now pay $1,000 a month or more will be able to find policies on the health exchanges … for as little as $308 a month."
Competition among the firms offering these exchanges will hopefully help to create lower prices, but much of the improvement in premium costs derives from problems in the system that the ACA aims to correct. In New York, insurance carriers are obliged to accept almost all applicants, but citizens face no regulations in regards to insuring themselves. That leads to a glut of uninsured healthy young people, and an equally large amount of older consumers forced to pay high premiums, to make up the difference.
"The reforms in the health care law ensure consumers will have access to better coverage at a lower cost in 2014," assures HHS Secretary Kathleen Sebelius, in a quote attached to the findings.
Among the studied 11 states, the proposed premiums for 2014 are down 18 percent when compared with the CBO's pre-ACA findings for the same timeframe. The studies even claim that demographics at risk for high premiums will see stark decreases in their payments.
"Tax credits will help many young men in this market," declares the study, testifying that "a 25 year old… could pay as little as $34 per month for a silver plan in North Los Angeles, and could purchase a bronze plan for as little as $7 per month."
*Note: Content provided is not intended as legal or tax advice.