A First Peek at Obamacare Costs in California
As we prepare to plunge into a new world with most of Obamacare taking hold in 2014, lots of hand-wringing about Obamacare costs is coming from all quarters. For months now, headlines have been filled with dire predictions like this one from Forbes: ”A Temporary Insurance Program Foretells Exploding Obamacare Costs.” But this week, we got our first peek at what premiums will be like under Obamacare from California. And the costs are not as high as many warned.
Blue Shield of California, for example, estimates that its current customers will see rates go up by 13%, versus predictions that they would see a 30% rise. The increases are driven by covering previously uninsured people with expensive pre-existing conditions, as well as higher prices for healthcare services.
“The changes in the market are really making individuals much more like employer groups,” according to Paul Markovich, CEO of Blue Shield.
Back in 2009, the Congressional Budget Office estimated that a silver level plan in California would cost $433 per month under Obamacare. More recently, the consulting firm Milliman predicted the tab would be $450 monthly. But the actual prices published this week are substantially lower. The least expensive silver plan will be $276 per month. A young person can get a bronze level plan for just $172 monthly. Subsidies for low-income people will bring the cost even lower.
Consumer health advocates like Anthony Wright are welcoming this news. “Health insurance isn’t cheap but this seems to provide individuals and families the group rate that large employers get.” Wright is executive director of Health Access California.
Airborne, photograph © Professor Bop / flickr
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