Several Louisiana health insurance companies have announced that they want to raise premium rates for some policies next year. Opponents of the Affordable Care Act are using this to again attack the law and its impacts on health insurance. But consumers — and voters — should keep a clear head and ask some basic questions.
The basic idea behind “Obamacare” is that greater access to primary care and preventive medicine will reduce costs in the long run — costs that all of us bear, whether for insurance premiums, hospital bills or expensive emergency room treatment for people who were unable to seek care early on. That was the premise of the Massachusetts health reform law that “Obamacare” was based on, and it has worked there.
While most Americans remain covered by health insurance through their employer, “Obamacare” established marketplace exchanges for those needing to purchase individual private policies. The use of health care exchanges in the private sector predates “Obamacare,” but the law sets standards for the new exchanges aimed at protecting consumers and covering basic care, rather than being merely profit-driven. It is the premiums for some of those policies that some Louisiana insurers are seeking to raise.
Consumers should remember that premiums rose every year before the ACA was passed. The national averages for those increases were 9.9 percent in 2009, 10.8 percent in 2010 and 11.7 percent in 2011. Over the past year, rates in some states have gone up, while in others they have come down. But in most cases the range in either direction was within 5 percent. Louisiana Insurance Commissioner Jim Donelon has said that the average rate increase for Louisiana in 2014 was around 10 percent.
Some of the state’s health insurers have proposed an even bigger increase for particular policies. Are they justified? Consumers will rely on the commissioner to tell us, even though the Legislature has blocked him from rejecting unjustified premium increases, unlike his counterparts in some other states.
The ACA requires companies to publicly justify rate increases of over 10 percent, and requires 80 percent of premium dollars be spent on health care, not administrative “overhead.” Consumers are better off because of those provisions, though some states like Louisiana have not allowed the law’s full benefits to be implemented.
The insurers have cited higher costs from greater utilization of health care services by people for whom they were formerly less accessible. But those costs also will be lower over time as more citizens are insured, which is another reason to support expanded coverage.
In Louisiana, as across the country, greater numbers of people enrolled in the health insurance exchange than had been expected. But many of the uninsured did not, no doubt because of negative media coverage and the lack of support by state officials.
Given that Louisiana has the third-highest rate of uninsured people in the nation, and that we rate 49th in poor health outcomes, we should support “Obamacare,” not fight it.
former secretary, Louisiana Department of Health and Hospitals