As Always, Take Obamacare Premium Hike Stories With a Big Grain of Salt

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The Kaiser Family Foundation has a new report out suggesting that Obamacare premiums are going to skyrocket next year. Maybe so. But before everyone gets into another Trump-inspired tizzy about this, please note the highlighted section of the Kaiser table below:

Insurers always ask for more than they get. In the 13 states that Kaiser examines, insurers have asked for rate increases averaging 11 percent. And who knows? Maybe they’ll get it. More than likely, though, they won’t. This is an opening bid, and the final contract won’t be set for several more months.

So, as usual, take this with a grain of salt. The truth is that Obamacare premiums started out lower than most analysts predicted, because (a) insurers turned out to be really interested in lowballing their prices in order to gain market share, and (b) they didn’t have much data to base their rates on. As the market shakes out, real-world data will become more available and market shares will start to settle down. It’s possible that this will drive a couple of years of semi-large-ish premium increases, but that’s about it. And maybe not even that much.

So don’t panic. We don’t know yet if premiums are really going up 11 percent. But even if they are, it shouldn’t be a huge surprise. The real test will be how the original Obamacare projections compare to real-life premiums in, say, 2019. My guess is that they’ll be fairly close. More here from Charles Gaba, who basically says we just don’t know yet what will happen in 2017.

HERE ARE THE FACTS:

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ONE MORE QUICK THING:

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As we wrote over the summer, traffic has been down at Mother Jones and a lot of sites with many people thinking news is less important now that Donald Trump is no longer president. But if you're reading this, you're not one of those people, and we're hoping we can rally support from folks like you who really get why our reporting matters right now. And that's how it's always worked: For 45 years now, a relatively small group of readers (compared to everyone we reach) who pitch in from time to time has allowed Mother Jones to do the type of journalism the moment demands and keep it free for everyone else.

Please pitch in with a donation during our fall fundraising drive if you can. We can't afford to come up short, and there's still a long way to go by November 5.

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