Insurers in Maine are proposing to raise individual health plan premiums by as much as 22 percent to cover rising costs imposed by the Affordable Care Act (ACA).
If the Maine Bureau of Insurance approves the rate increases insurers have proposed, premiums will rise between 14 and 23 percent for individual plans sold in the state, Insurance Journal reported in May. The premium hikes would begin in January 2017.
State Sen. Andre Cushing (R-Newport) says individuals in Maine and other states are paying more than necessary because of structural flaws in the ACA.
“It is designed to overpromise and under-deliver,” Cushing said. “We suddenly have millions of Americans accessing what is being portrayed as ‘free’ health care from the government, putting a tremendous burden on the system. Compounding the problem is the rising cost of health care. It’s no surprise that the system is unsustainable, and those who pay for their own health care insurance are going to be asked to pick up more of the tab for those who don’t.”
ACA Halted Maine Reform
In 2010, before ACA was implemented, Maine lawmakers had slowed the increase of insurance premiums by passing market-based legislation encouraging consumer choice and competition, Cushing says.
“By broadening community ratings bands and allowing more competition into the system, health insurance premiums that had seen double-digit increases for decades suddenly began to decline,” Cushing said. “The cost of premiums for health care plans in Maine either dropped in price or the rate of increase dropped drastically. There was also a reinsurance pool to allow coverage for those with preexisting conditions and catastrophic illnesses. All of this happened before the ACA went into effect.”
One Size Doesn’t Fit All
Liam Sigaud, an analyst at the Maine Heritage Policy Center, says allowing insurers, instead of Congress, to determine which services plans must cover would let them offer families better value.
“Reducing government regulations to give insurance companies more flexibility would be helpful,” Sigaud said. “The essential benefits package mandated by the Affordable Care Act, for example, compels insurance providers to cover a wide range of services, regardless of a client’s needs or preferences. As a result, premiums are driven up.”
Consumer-oriented reforms freeing health care providers and patients to decide their own terms of treatment in a competitive market would reduce health care costs and insurance, Sigaud says.
“Health care costs need to decline if we want to see more reasonable insurance premiums,” Sigaud said. “Innovative ideas like comparison shopping for low-cost care, direct primary care arrangements, and a repeal of certificate of need laws need to be adopted.”
Jordan Finney ([email protected]) writes from Boise, Idaho.
“2016 Obamacare Deductibles Increase Tracker,” Freedom Partners, March 2, 2016: http://freedompartners.org/latest-news/2016-obamacare-deductible-increase-tracker/
“2016 Obamacare Premium Increase Tracker,” Freedom Partners, January 10, 2016: http://freedompartners.org/latest-news/2016-obamacare-premium-increases/
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