ACA Marketplace Insurance Costs to Skyrocket? Wanna Bet?

by James C. Sherlock

We know it every time we see it. It is the time-honored Congressional ritual of “temporary” federal subsidies.

Such subsidies for nearly anything that are positioned originally as “temporary” tend to be extended and then often made permanent entitlements. As with everything else, the people who get subsidies care far more about preserving them than those who are not subsidized care about eliminating them.

For example, see the nation’s system for regulating peanut farming. The federal government subsidizes peanut farmers and their incomes by restricting supply.

The laws require a Federal license in order to grow peanuts. Very few licenses have been issued since the early 1940’s.  The result: Americans pay 50% more for home-grown peanuts than they would if the market was not restricted.

I can find no record that President Carter raised the issue.

In this case, concerning federal Affordable Care Act (ACA) subsidies, NBC news has alerted us to a pending issue.

During the open enrollment period for 2022 coverage, 307,946 Virginia residents enrolled in private qualified health plans (QHPs) through the Virginia exchange/marketplace.

It involves temporary federal subsidies to ACA Marketplace customers to keep demand high, supporting the prices that are paid to insurers and by insurers to hospitals and healthcare providers. These subsidies are set to expire.

The Kaiser Family Foundation published a study that shouts:

On average, premiums are set to rise by more than 50% for people getting health coverage through a (ACA) marketplace plan.

Wanna bet?

The source of the price increase:

The American Rescue Plan Act, which was signed into law in March 2021, removed — for two years — the income cap for eligibility (400%) of the federal poverty level.

Of the 14.5 million people enrolled in marketplace plans, 13 million receive subsidies of varying amounts to reduce what they pay in premiums.

The inevitable conclusion:

Unless Congress takes action, enhanced premium subsidies — technically, tax credits — that have been in place for 2021 and 2022 will disappear after this year. The change would affect 13 million of the 14.5 million people who get their health insurance through the federal exchange or their state’s marketplace.

“The default is that the expanded subsidies will expire at the end of this year,” said Cynthia Cox, a vice president at the Kaiser Family Foundation and director of its Affordable Care Act program. “On average, premiums would go up more than 50%, but for some it will be more.”

“Unless Congress takes action”.

Assuming Congress does not extend the expanded tax credits, only people with household income from 100% to 400% of the federal poverty level will once again qualify for subsidies.

“Assuming Congress does not extend.”

Anyone want to predict the odds?

Can you say “entitlement” to rescue a program that was fatally flawed from the start?

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12 responses to “ACA Marketplace Insurance Costs to Skyrocket? Wanna Bet?”

  1. DJRippert Avatar

    We won’t know what’s in the law until we pass it.

    1. Nancy Naive Avatar
      Nancy Naive

      Or the devastation of a court ruling until it’s issued.

    2. Nancy Naive Avatar
      Nancy Naive

      BTW, she said, “We have to pass the bill so that you can find out what is in it, away from the fog of the controversy.”

      Emphasis on YOU and FOG because she knew that Americans will experience the truth, but until they did, will believe any BS spread by the likes of you — emphasis on YOU again.

      1. DJRippert Avatar

        Typical liberal spin in defense of the leftist gerontology. No, Congress does NOT have to pass a bill so that “we, the people” can find out what’s in it. And, the FOG of controversy is what is known as debate. It’s why bills are discussed and debated in public.

        Only a egomaniac says that bad laws have to be passed so that “Americans will experience the truth”.

        1. Nancy Naive Avatar
          Nancy Naive

          Have you found those pedophiles at the pizza parlor yet?

  2. Matt Adams Avatar
    Matt Adams

    Insurance companies helped write the PPACA, they knew that they were always going to be getting their money. Obviously they preferred that to be guaranteed by the federal government. Now, we will just revert to what it was before more people without insurance.

    The larger issue is the conflation of insurance and healthcare.

  3. James McCarthy Avatar
    James McCarthy

    Did I miss the mention of Virginia in this piece?

    1. LarrytheG Avatar

      oh THAT?

    2. James C. Sherlock Avatar
      James C. Sherlock

      Read it again. Pretending not to understand that Virginians participate in an ACA marketplace is not a good look, James.

  4. Nancy Naive Avatar
    Nancy Naive

    No $#!^ Sherlock. I received a notice two weeks ago that my term life policy (a cheap carryover from work) is reducing its “clean living” discount from 20% to 10% because an unusually high payout of Covid death benefits. It also suffered investment losses compounding the issue.

    Can’t wait until May 2023 when my supplement health policy renews. Healthcare Insurance is NOT insurance. It’s a payment plan.

  5. Not peanuts! Speaking of which USDA isdues more regulations per year than any other federal agency. Socialized agriculture personified. Controlling the market controls the industry.

  6. LarrytheG Avatar

    speaking of health insurance subsidies:

    The folks that buy ACA health insurance pay for it with after-tax money, no? The folks who pay for employer-provided health insurance pay for it with pre-tax money – essentially a subsidy.

    So both are subsidized. what’s the problem?

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