Health Reform: A year ago, we were told with great certainty that ObamaCare critics had it all wrong when they warned about coming premium rate shocks. Then came the eye-popping rate requests for next year.
When rate increases came in last year and seemed relatively mild, they were treated as proof positive that the law was succeeding.
"ObamaCare's critics promised the law would send insurance premiums skyrocketing. They were wrong," said one. "Despite these Chicken Little predictions, ObamaCare has once again proven to be an unqualified success," claimed another. "Another stake in the heart of a popular anti-Obamacare claim has arrived," said yet another.
New York Times columnist Paul Krugman went so far as to say last September: "We're actually seeing the opposite of a death spiral; call it a life spiral."
Krugman and others claimed that ObamaCare had attracted a well-balanced risk pool, full of enough low-cost enrollees to hold claims down. And they said that there was more competition in the exchanges in year two, which was also supposed to control costs.
"Success feeds success," Krugman asserted.
But as IBD and others have noted, ObamaCare's insurance regulations virtually guaranteed a rate spiral. The reason is that ObamaCare bans insurance companies from denying coverage or charging more for those who have pre-existing conditions.
We pointed out that several states had already tried these "guaranteed issue" and "community rating" reforms, and they'd been a disaster. Higher premiums encouraged the young and healthy to forgo insurance, knowing that they could sign up after they got sick, which drove premiums still higher.
ObamaCare was supposed to avoid this fate by heavily subsidizing insurance premiums and imposing a tax penalty for going uninsured, to get the young and healthy to sign up and keep premiums down.Read the rest of story HERE.
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