Facing the Reality of ObamaCare

The election is over, and the President and Congress are back at work. One of the most controversial laws passed in the President’s first term is undeniably the Affordable Care Act. No matter what “side of the aisle” you prefer in Congress, this piece of legislation is going to have a profound effect now and for years to come. It was intended to revolutionize the accessibility of health insurance for those previously left out of the pool. But, as an article in Forbes points out, it is already affecting the lives and paychecks of millions of Americans. According to “ObamaCare Guarantees Higher Health Insurance Premiums--$3,000 + And Higher,” by Sally Pipes, the ACA is already having an immediate impact on the wallet.

Campaigns are full of promises. The ACA promised it would reduce insurance premium costs by $2,500 for a typical family by the end of President Obama’s first term. Somehow the reality of the math didn’t measure up to the rhetoric. As the article states, many Americans are seeing a significant rise in insurance premiums, averaging $3,065 per year. To a family already struggling with a sluggish economy, wage freezes, and higher costs for gas and other basic services, this can be too much to bear. What’s more, the increases affect employer-sponsored health insurance, which has typically been the most affordable resource for health insurance. 

And the predictions get worse. By 2014, when the full regulations kick in, Mark Bertolini, a CEO for Aetna, predicts that unsubsidized health insurance premiums will rise by as much as 50 percent, and double in some markets. The ACA’s subsidies are supposed to bring down the actual cost, but may not make that much of a reduction in the actual out-of-pocket. 

The regulations and limits on subsidies are predicted to hit young people the hardest. That is a switch from previous years, since older insured people usually paid higher premiums because they have more health issues and experience higher claims. Younger workers are finding jobs paying lower salaries with fewer benefits as it is. With student loans and other debt, it’s going to make it tough going when insurance premiums take a bigger bite out of a smaller paycheck.

According to the article, the insured aren’t the only ones in jeopardy. One of the provisions of the ACA determines which health care benefits are essential and mandatory for insurers. Chiropractors, acupuncturists, and other holistic or non-traditional healthcare practitioners are storming Washington, lobbying for their services to be labeled as “essential” and covered under the new ACA. If not, insurers may decide to eliminate them or move them to a higher out-of-pocket category. 

The article concludes that few insured will see the $2,500 insurance premium decrease as was so frequently promised during the campaign. At the least the administration is hoping premiums won’t rise so quickly. With the expiration of the Bush tax cuts, workers are already seeing paychecks decreased by higher payroll taxes. Add higher insurance premiums or out-of-pocket costs, and it may be too much to bear. 

The other reality is employers and the insured won’t call Washington to complain or for an explanation. They’ll ring their insurance agent, broker or company human resources department. Insurance professionals should start now to help educate their clients about the harsh realities of the ACA and what they can do to “ease the pain” of healthcare reform. 

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