The Tennessean headline on this same news is "Tennessee's health insurance rates among lowest in U.S. on new exchanges." Not surprisingly, Alexander's take is a little different: "Obama Administration Report Finds Obamacare Will Increase Premiums for Some Tennesseans by as Much as 290%"
From the press release:
Some details on what Tennesseans can expect:
Today, a 27-year-old man in Memphis can buy a plan for as low as $41 a month. On the exchange, the lowest state average is $119 a month—a 290% increase.
Today, a 27-year-old woman in Nashville can also buy a plan for as low as $58 a month. On the exchange, the lowest-priced plan in Nashville is $114 a month—a 197% increase. Even with a tax subsidy, that plan is $104 a month, almost twice what she could pay today.
“Why should a 27-year-old male in Memphis be forced to pay nearly three times more than what he pays today for health insurance?" Alexander asks. "Why should a young woman in Nashville have to pay twice as much? This isn’t what President Obama promised Tennesseans, but it’s what he’s giving them—higher costs and less choice—two of the most urgent reasons Obamacare must be repealed and our health care system fixed.”
Who knew insurance policies have been so cheap? Why do we need health care reform when we can buy coverage now for $41 a month? What's Alexander talking about? We asked the Tennessee Justice Center's Gordon Bonnyman, the advocate for health care for poor people, to clear up our confusion and, sadly, it turns out the senator is bullshitting us, as per usual. Here is what Bonnyman had to say:
There’s insurance, and then there’s “insurance.” I’m not sure what policies the Senator’s office is talking about that are currently available at those prices. But any that are that cheap now are bound to be riddled with exclusions, benefit limits and hidden costs that leave consumers with little real security. Unfortunately, the way the individual insurance market works now, it is practically impossible for consumers to understand or compare those “gotcha” terms that often turn insurance coverage into Swiss cheese. They only find out what they’ve been paying for when they get really sick or have a bad accident, and then of course it is too late.
That is about to change. Insurance offered in the new online marketplace will have to meet new requirements that will ensure that it provides minimum essential coverage. There will be a wide array of options from which to choose, with standardized disclosures that will enable consumers to make “apples to apples” comparisons that are impossible to make now. Consumers that want to pay less for less robust coverage will be able to do so. Those who want more protection at a higher price can find what they are looking for.
It is misleading to quote the new prices without pointing out that those are before premium tax credits are counted in. Premium tax credits will be available on a sliding scale for everyone who does not have adequate coverage through their employer, and who have incomes between 100% and 400% of the federal poverty level. That translates into incomes ranging up to $45,000 annually for a single person, or $93,000 for a family of four — they will qualify for premium tax credits sufficient to hold the cost of their coverage to 9% of their income. A large majority of young people who are single will qualify for the premium tax credit, because median and average incomes for those folks is well below the 400% FPL cap.
For young people who are fortunate enough to have incomes above the premium tax credit range, they may pay higher premiums, now that we have consumer rating that spreads costs across the entire population and eliminates discrimination based on gender and health condition. But young women of child-bearing age gain, because they no longer pay discriminatory rates, and they are assured of coverage for pregnancy and delivery costs.
Bottom line: the reforms that are about to take effect improve the insurance market for everyone, except for insurance companies that have been able to market costly, inferior products. They probably won’t survive in the new competitive, transparent marketplace that will launch next week.