In the public discourse over Obamacare, there is always lots of talk about the cost of insurance either going up or down, depending on who is speaking. While insurance premiums have been on the rise for over a decade, the provisions of the Affordable Care Act are supposed to slow down or reverse that trend while allowing more people to be covered under subsidies. The proof will come over time. In the meantime, we do have some good news about the cost of premiums.
The weighted average cost of premium plans for 48 states (including DC) is 16 percent below projections by the Congressional Budget Office (CBO).
HHS reports that in about 94 percent of cases the CBO overestimated how high premiums would be. Specific premiums are going to vary quite widely from state to state and according to your age and the size of your family. But nationwide health care spending has grown more slowly than people had expected over the past couple of years, and in most states insurance companies have offered fairly aggressive bids to participate in the exchanges.
Not only is that good news for the consumer by way of premium savings, it’s good for the federal budget. The Center for American Progress estimates the savings to the government via lower tax credits will be greater, at 21%. That should reduce the federal government’s obligations by $190 billion by 2023. In addition, the lower costs should increase the number of people who enroll by nearly a million people by 2023.