Well, wait a minute.
Let's consider a few things:
- This week the California insurance commissioner reported that the average unsubsidized 2014 rate increase carriers charged going into Obamacare was between 22% and 82%. That was a pretty healthy bump to get everyone into Obamacare in the first place.
- California voters will go to the polls this fall to vote on Proposition 45. That ballot initiative would regulate health insurance rates in California for the first time. Big rate increases on part of the carriers would do a lot to get that proposition passed and very low increases would do a lot toward defeating it.
- The health plans competing in the Obamacare exchanges are limited to tiny losses this year because of the Obamacare reinsurance program that runs through 2016. In effect, anymore underpricing they put into their rates for 2015 is subsidized by the federal government. In fact, the Obama administration recently took the statutory caps off of how much they can pay the carriers to keep their bottom line whole.
The California insurance commissioner has said that consumers saw individual health insurance rate increases of 22% to 82% to get into Obamacare in the first place.
There is a highly contentious November ballot initiative facing the health plans they absolutely do not want to see passed, that would put the government in charge of their rate setting in future years, giving the carriers every incentive to low ball the 2015 rates.
And, to the extent the carriers low ball the rates taxpayers will pay for every dime of it.
Does the average 4% rate increase mean Obamacare is a big success in California?
For 2015 it does.
Let's see how this all goes when the training wheels come off after the reinsurance program goes away and the election passes.