Well, it’s been an interesting week in health care land. For a while now, independent analysts—and conservative critics—have raised concerns that Obamacare will dramatically increase the cost of individually-purchased health insurance for healthier people. This would, of course, contradict President Obama’s promises that “if you like your plan, you can keep it” and that the cost of insurance would go down “by $2,500 per family per year.” What’s new is that liberal columnists, facing reality, are conceding that premiums will go up for most people in the individual market. But they’re justifying it by saying that “rate shock” will help a tiny minority of people who can’t get insurance today. If they had said that in 2009, would Obamacare have passed?
Last month, progressive pundits were trumpeting news out of California that the cost of health insurance under Obamacare in that state was surprisingly low. “Well, the California bids are in,” wrote Paul Krugman on May 27. “And the prices, it turns out, are surprisingly low…So yes, it does look as if there’s an Obamacare shock coming,” the shock that Obamacare will work just fine.
It turns out, however, that Krugman was uncritically regurgitating California’s misleading press release. In fact, the average 25 and 40-year-old will pay double under Obamacare what they would need to pay today, based on rates posted at eHealthInsurance.com (NASDAQ:EHTH). More specifically, for the typical 25-year-old male non-smoker, the average Obamacare “bronze” exchange plan in California will cost between 64 and 117 percent more than the cheapest five plans on eHealth. For 40-year-old male non-smokers, it’s between 73 and 146 percent more.
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