BLUE CROSS BLUE PATIENTS AND HIGHER INSURANCE PRICES UNDER OBAMACARE
Blue Cross Blue Patients http://online.wsj.com/article/SB10001424052748704007804574574170859847850.html
Another study predicts higher insurance prices.
confirming that ObamaCare will increase the price of health insurance. The Blue Cross Blue Shield Association has found that premiums in the individual market will rise on average by 54% over the status quo, which translates into an extra $3,341 a year for families and $1,576 for singles. The White House denounced the report as a “sham” before it was even released, which shows how seriously it takes such concerns.
The Congressional Budget Office also found this week that ObamaCare will boost premiums in the individual market by as much as 13%. But the White House called that a triumph because the higher costs will be offset by taxpayer subsidies that will be transferred to the federal balance sheet.
The Blue Cross study is in fact more precise than CBO’s because it is based on real market data, rather than modeling assumptions. The association mined the actuarial data from its six million individual or small-business policies, nearly one-eighth of those sold in the U.S.
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Lo and behold, Blue Cross found costs will rise if Democrats force insurers to cover anyone who applies and then limit how much insurers are allowed to charge based on age or health condition. Economists call this adverse selection; people will wait until they’re sick to buy coverage, and the Democratic rules make it perfectly rational for them to do so.
“And you can bet as we continue to make progress,” communications director Dan Pfeiffer wrote on the White House blog, “the insurance industry will continue to try and distract and misinform because they know their very profitable status quo is in grave danger.” He must be referring to the industry’s overall profit margin of 2.2% in 2008.
The reality is that all health-care costs are ultimately borne by consumers, whether through more expensive premiums, lower wages or higher taxes. The regulatory schemes favored by Democrats can’t change that law of economics but they will ensure that insurance is even more costly than it is today.
When that day comes, the political class will of course blame the insurance companies, and all of the current White House denials will fall down the memory hole.
Printed in The Wall Street Journal, page A20
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