The Affordable Care Act (“Obamacare“) was passed on March 23rd, 2010. Since then, health insurance premiums have steadily risen.
And for 2018 premiums are up 34%.
For certain payees, the tax subsidies can help offset the overall cost. However, it doesn’t immediately help their monthly bill.
For other payees, their tax subsidies will be unaffected and they’ll be forced to shell out anywhere from $50-$300 more a month.
Sure, a huge chunk of the rising costs of insurance are preventable, such as obesity, but the fact that these insurance companies must keep up-surging prices well past inflation begs the question: “What the hell is going on?”.
Well, the Affordable Care Act did manage to do one thing well: create monopolies. This occurred because of the number of insurers that can’t afford to compete on the exchange. So they just leave. And then one company controls an entire area. And in certain circumstances, an entire state (such as Wyoming).
In this Wall Street Journal Article discussing insurers leaving the exchange, there are a few interesting quotes:
Leemore Dafny, a professor at Harvard Business School, says that having a small number of insurers is “likely to lead to a very pricey exchange.”
“It’s terribly concerning,” said Julie Mix McPeak, Tennessee’s commissioner of insurance. In most of her state, there will likely be just one exchange insurer next year, after the withdrawal of UnitedHealth; consumers throughout the state had at least two options in 2016.
The fact that two insurers are a goalpost is terrifying. So much for free market competition.
But all of this got me thinking.
How are the insurance companies actually doing since the Affordable Care Act passed?
The prices sure are going up a lot. They must be struggling from all the ACA requirements… right?
Well, I don’t think I need to say much here. Just take a glance at the graphs and make your own conclusions.
These are some of the top health insurance companies in the US. Pinpointed around the date that ACA was passed.
Health Insurance Company Stock Prices Post-ACA
I knew I should have invested when Obamacare was signed. Maybe then I could have afforded the insurance premium.