The average cost of a benchmark health insurance plan under Obamacare is expected increase by 15 percent next year, according to a new report published Thursday by the Congressional Budget Office.
The CBO said their estimated increase comes from several factors, one of which is the fact that so many insurance companies are dropping out of the marketplace, leaving many areas with only one insurer left on the Obamacare exchange.
Uncertainty in the marketplace stemming from Congress’s waffling on repealing Obamacare is also driving up prices, as insurance companies aren’t sure whether they can count on continuing to receive federal subsidies to help bear the cost of covering millions of sick Americans, CBO notes, explaining:
In 2018, the agencies project, the average benchmark premium will be roughly 15 percent higher than it was in 2017, largely because of short-term market uncertainty—in particular, insurers’ uncertainty about whether federal funding for certain subsidies that are currently available will continue to be provided— and an increase in the percentage of the population living in areas with only one insurer in the marketplace.
Of course, anyone familiar with Obamacare history is unlikely to be shocked by the CBO's new estimate.
The average cost of the benchmark plan under Obamacare increased 22 percent heading into 2017, for a final price tag of about $296 a month. But that’s just an average – in places like Arizona, increase estimates heading into 2017 were as high as 116 percent.
The year before, the average cost of a benchmark Obamacare plan rose by about 7 percent. Americans who bought insurance plans on the marketplace but didn’t qualify for federal subsidies saw a price jump of about 10 percent.
As premium prices increase, so, too, does the amount of federal cash used to subsidize health care costs for the nearly one-quarter of Americans covered by an Obamacare plan or Medicaid. In 2017 alone, CBO notes U.S. taxpayers will have shelled out $705 billion for health care subsidies.