New Mexico Premium Costs Expected to Skyrocket
Patients in New Mexico could take a big financial hit when the health care overhaul, known as Obamacare, takes effect.
The Society of Actuaries has released a report concluding premium costs for individual health plans—an industry expected to get more crowded as the Affordable Care Act kicks in starting in 2014—will rise by an average of 34.9 percent in New Mexico and 31.5 percent throughout the United States once the landmark law is fully enacted.
According to a consulting actuary for the society, pools of high-risk patients are now expected to swarm toward individual health plans, thus offsetting any gains for insurers because of higher volumes and the addition of lower-risk patients forced to get coverage.
“The financial effect of those [high-risk] people used to be spread more widely,” Kristi Bohn told The Wall Street Journal’s Marketwatch. “Now they’ll all be in the individual market."
Ohio Even Worse
New Mexico may be taking an above-average hit, but people in Ohio are taking a gigantic one, the report says. The actuaries report estimates an 80.9 increase for the Buckeye state.
While costs in individual plans are estimated to take a leap, the report estimates the percentage of uninsured in New Mexico will drop from 22.9 percent to just less than 9 percent.
“The major consequence of ACA is government expansion,” Dr. Deane Waldman of Albuquerque told New Mexico Watchdog.
A pediatric cardiologist, Waldman has been a harsh critic of Obamacare.
“This produces increased costs to insurance that they are passing on to consumers through higher premiums. For instance, the new regulatory application form for insurance companies is 12 pages long, 10-point font,” he said. “The one prediction about all government bureaucracy that is certain is that it will always expand. The costs that the government will impose on insurance will continue to escalate, and insurance will continue to pass these on.”
Just Five States Benefit
Although Health and Human Services Secretary Kathleen Sebelius admits some premiums will increase, she argues the impact will be minimal and that people “are really going to see much benefit for the money.”
Just five states—Rhode Island, Vermont, New Jersey, New York, and Massachusetts—will see reductions in individual health care plan costs.
Despite the study’s conclusions, White House Deputy Press Secretary Josh Earnest told reporters, “once the Affordable Care Act takes effect it will increase competition, drive down costs, and result in average premiums being lower than they are today for the exact same benefits.”
Society of Actuaries: “Cost of the Future Newly Insured under the Affordable Care Act (ACA)”