By Michael Snyder
Are you ready to pay 37 percent more for health insurance in 2018? Obamacare is imploding faster than most of us imagined, and these rate increases are absolutely killing hard working middle class families all across the country. I wrote about the steady erosion of the middle class yesterday, and health insurance is one of the main reasons why the cost of living is increasing at a much faster rate than our paychecks are. It greatly frustrates me that we have given the Republicans control of the White House, the Senate and the House of Representatives and Obamacare still has not been repealed. The truth is that should have happened on day one of the Trump presidency.
Monday’s news was dominated by headlines about the indictments of Paul Manafort and Robert Gates, but a new round of Obamacare rate increases is going to have much more of a direct impact on the lives of ordinary Americans. According to CNN, premiums for silver Obamacare plans will increase by an average of 37 percent next year…
Premiums for the benchmark silver Obamacare plan will soar 37%, on average, for 2018, according to federal data released Monday.
And remember, this 37 percent increase is on top of all of the other yearly increases that we have seen so far. Many families have already seen their health insurance premiums more than double since Obamacare became law, and now things are going to get even worse.
The silver plans are the most popular, and this is especially true among younger people. According to that same CNN story, a 27-year-old will now be paying almost five thousand dollars a year for one of these silver plans…
The steep rate hike means a 27-year-old will pay nearly $5,000 a year, on average, for the benchmark silver plan, upon which premium subsides are based. That’s up from $2,600 when the Obamacare exchanges opened in 2014. This is before subsidies are factored in, however.
Premiums are skyrocketing for a second year in a row. Rates rose 24% this year in the states using healthcare.gov.
Do you know any 27-year-old that can afford to pay $5000 a year for health insurance?
And because deductibles are so high, most of them are quite afraid to go to the hospital anyway.
As Obamacare plan premiums go up, so do the subsidies. At this point more than 80 percent of all those enrolled in Obamacare plans receive subsidies, and that means that much of the burden for paying these rate increases ultimately falls on the taxpayers.
And by taxpayers, I mean you and me.
Here in Idaho, the rate increases are going to be even higher than the national average. In fact, it is being reported that silver plan rates will be going up by an average of about 50 percent in 2018…
Idaho Statesman reporter Audrey Dutton reports that the largest increases are proposed in the “silver” plans, which are the most popular ones on the exchange, falling mid-range in pricing and benefits between the lower-level “bronze” plans and the high-end “gold” plans. Silver plans are showing average increases of 50 percent in premiums; they range from a low of 40 percent at Blue Cross to 69 percent at SelectHealth.
Needless to say, Idaho families cannot afford these sorts of rate increases, and I am for a 100 percent repeal of Obamacare immediately. In my new book entitled “Living A Life That Really Matters”, I touch on some of the things that we need to do to start fixing our deeply broken healthcare system. We once had the greatest system of healthcare on the entire planet, and I believe that we can get there again, but we desperately need to return to free market principles. I am very much in favor of the kinds of association buying groups that Rand Paul has proposed, and I would like to see exciting new concepts such as direct primary care implemented much more extensively.
Doing nothing is not an option. The longer that Obamacare is allowed to exist, the more financial damage it will do to middle class families.
Today, we learned that the U.S. savings rate has fallen to a 10 year low. Most families cannot save much money because they are just scraping by from month to month. The middle class is now a minority of the population, and as health insurance rates continue to rise the financial stress on American families is only going to intensify.
We also just learned that real disposable income per capita has been declining since May. The following comes from Wolf Richter…
But consumers don’t feel that. What they feel is their slice of the pie, but that pie got cut into more slices as the US population expanded. And this leaves disposable income “per capita,” which the BEA also discloses, but mercifully buried in the data.
This real disposable income per capita — a function of income, taxes, inflation, and population growth — peaked in May and has been declining ever since.
A 37 percent rate increase is going to be absolutely devastating to those that are on silver plans. We were promised that Obamacare would make healthcare cheaper and more affordable, but instead the exact opposite has been true.
By the time the 2018 mid-term elections roll around, there are going to be tens of millions of Americans that are deeply angry about health insurance rates, and many believe that they will take that anger out on Democrats and on establishment Republicans that blocked the repeal of Obamacare.
But the Democrats are hoping for a different result. They are hoping to retake either the House or the Senate in 2018, and if Republicans have not repealed Obamacare by then the Democrats will completely block any further attempts to do so.
The clock is ticking, and the Republicans need to get something done. Up to this point they have completely fumbled the football, but there is still time to recover if they can get their act together.