Premiums under Obamacare will drop next year, according to Health and Human Services (HHS) Secretary Alex Azar.
It is the first decline in health premiums for the “silver” plan — the most popular option under the Affordable Care Act, or ACA — since the law took effect.
What’s more, Azar said, the number of insurance companies participating in the government’s online exchanges has grown slightly after years of shrinking markets. Although the premium reduction is rather modest— the projected decline is 2 percent — Azar credited President Donald Trump with the improvement.
“The president trying to sabotage the [Affordable Care Act] is proving better at managing it than the president who wrote the law,” Azar said Thursday during a speech in Nashville, Tennessee.
The reduction contradicts dire predictions from Obamacare supporters that eliminating the penalty for not having insurance — a feature of the tax law Congress passed last year — would wreak havoc on insurance markets.
The rationale is that without the so-called insurance mandate, young and healthy people will flee, forcing companies to hike rates on the older, sicker population that remains.
But Edmund Haislmaier, a health policy researcher at the conservative-leaning Heritage Foundation, argued that heavy-handed regulations embedded in the law caused the spike in the premiums in the first place.
“Obamacare’s many insurance mandates resulted in years of high cost jumps and a dramatic plunge in overall choices for millions of Americans,” he said in a statement.
Haislmaier pointed to research indicating that those trends have leveled off.
“And that states — when they get even a small amount of freedom from Obamacare’s regulations — are able to create more competitive insurance markets that offer health plans with lower premiums,” he added.
Haislmaier praised Trump’s efforts to reduce health care costs through measures that do not need congressional approval.
“However, the overall flawed structure of Obamacare remains,” he stated. “That’s why Congress must pass reforms that unleash more competition, better quality, and affordable costs. Conservatives have a plan to do just that. Our plan empowers consumers to choose the best coverage for them while giving states the resources and flexibility they need to achieve this goal.”
Some of The Heritage Foundation’s recommendations include:
- Eliminating the ACA’s spending schemes. Under the current setup, Obamacare is expected to cost taxpayers roughly $1.6 trillion from 2019 to 2028. The think tank suggests ending insurance subsidies and Medicaid expansion.
- Providing block grants to the states in order to innovate health solutions.
- Giving states more flexibility to devise their own regulations.