After six years of Obamacare, it is clear that the law has been a complete failure. This should come as no surprise considering the many failures of the law. Despite being sold as a plan that would lower deficits and reduce spending, Obamacare has wound up costing taxpayers over $1 trillion and American consumers millions more in increased premiums. The problem is only getting worse – last week, officials from the state of Oklahoma announced that Obamacare plans within the state face a 76 percent hike.
According to the Oklahoma Insurance Department, increases will range from 58 percent to 96 percent. This price hikes are in part driven by a lack of competition as Oklahoma is one of five states that has just one insurance company operating on their Obamacare exchange. However, the story is the same across the country. The many mandates and regulations in the law have driven up costs and discouraged participation from insurers and enrollees, resulting in higher costs for those that remain in the system. Recently, this has led to individuals and insurance companies fleeing Obamacare exchanges.
The failure of the law may be best proven with the failure of Obamacare co-ops which were created by the law as insurance alternatives. As of this year seventeen Obamacare co-ops have failed. Most recently, the state of New Jersey was forced to leave 35,000 citizens without coverage, despite the almost $110 million in taxpayer funds that the co-op received in loans. Including the Garden State, failed co-ops have cost taxpayers over $1.8 billion.
The complete demise of Obamacare was predictable. In the years after its implementation it became apparent that it was not a sustainable program. In order for Obamacare to work a significant portion of enrollees, around 40 percent, need to be within the 18-34 age group. However, according to the Department of Health and Human Services, only 28 percent of enrollees are within this age range. The unsustainability of the program is the reason why several co-ops have failed and the exchange in Oklahoma is struggling.
In the few states that continue to operate co-ops, their citizens face crippling premium rate hike. As of this year, insurers operating in Obamacare exchanges have requested an average premium rate hike of 24 percent. Due to increasing medical costs and the expiration of federal programs that help offset expenses, insurers are facing increasing financial loses. These loses are so great that in many cases even with a rate hike, many insurers continue to reduce their involvement in exchanges or leave completely.
As Obamacare fails because of its unsustainability, the burden falls upon taxpayers and consumers to continue to spend hundreds of millions of dollars to continue to prop up the system. Unfortunately, the citizens of Oklahoma are just the most recent casualties of this failed program.
Photo credit: Images Money