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Thanks A Lot, Mr. President! My Health Premium Is Up 114%

This article is more than 10 years old.

Obama signing the ACA (Photo credit: Wikipedia)

I don't know whether to laugh or cry. My health insurer, Kaiser Permanente, has finally calculated what our family's new health insurance rates will be under the grotesquely misnamed Affordable Care Act (a.k.a. Obamacare.) The upshot: my premiums are about to rise by 114.6%. My wife's rates? Up 109%. Our kids? Don't ask.

Yes, it's time to say goodbye to my current plan, with its $232-a-month premium. That plan is being discontinued, I'm told, because it "does not meet the requirements of the ACA." It was a nice plan, with low premiums, free physical exams, a high deductible and eligibility for a Health Savings account. We got access to Kaiser's lower in-plan rates for minor medical care, and we had the peace of mind of substantial coverage if anything catastrophic ever happened.

But that plan is going the way of Lake Superior sturgeon or the Hetch Hetchy meadows. It's vanishing in favor of what someone else has decided would be progress. So now I'm being offered what's dubbed the KP CA Bronze HSA 4500/40%. My new premium will $519.25 a month -- more than double my old rates.

I wish there was some way of regarding this new "bronze" plan as an improvement over what we had before. But that's really not possible. The new deductible will be higher ($4,500 instead of $4,000.) My primary care benefit is worse (I'm now being told to pay 40% of billed charges, instead of a cap of $40.) My inpatient hospital coverage is worse (I'm to pay 40% instead of 30%.) Terms on emergency-room visits and prescriptions drugs are inferior, too.

There's probably a "silver" or "gold" plan that would match or even top my old coverage. But then I wouldn't be looking at a mere 114.6% increase in my premium. I'd have to pay even more.

Why is the grotesquely misnamed Affordable Care Act doing this? Kaiser's explanations are terse but revealing. As my Kaiser mailing explains, "This difference is due to general costs associated with the administration and delivery of health care (plus) new benefit and enrollment rules under health care reform."

The last six words of that sentence are crucial. We qualified for our current plan only because everyone in our family was reasonably healthy. If our medical histories were packed with details of battles against cancer, heart disease and the like, we wouldn't have met Kaiser's eligibility standards. So we benefited from the discounts that Kaiser could offer to a healthy segment of the population.

Now, insurers can't decide eligibility -- or even tweak premium rates -- based on applicants' medical histories. In the individual-coverage market, we're all being billed a much higher blended rate that reflects the needs of people with bigger health problems.

I'm fine with that social goal, as long as we have the honesty to structure such arrangements in a way that's based on informed public consent. The obvious model would be the sorts of  across-the-board taxes that pay for our public schools, our fire departments and the like. For all our grumbling about taxes, they are well-suited to funding projects in the public good. The tax system equalizes our payments, even as we accept the fact that some people will need specific services far more than others.

What's deeply disingenuous about the Affordable Care Act is that it pretends to be something other than a tax. In fact, it's so deep into the charade of not being a tax that its collection mechanisms are constantly on the verge of falling apart. Instead of fixing the "rigged market" that I critiqued in my 1996 book "Health Against Wealth," we've created an even more cumbersome, contrived system that has little chance of living up to the happy slogans of its early boosters. To learn more,  browse through the many excellent posts of my Forbes contributor colleague Avik Roy

(UPDATE) For a few hours, I hoped that Kaiser's new rates included a hard-to-discern addition of our two children onto my plan. If so, our premiums would rise a lesser -- though still amazing -- 40% or so. But alas, this is not the case. Kaiser has now briefed me on what's happening to our teenage boys' coverage, and those numbers are even more gruesome. Both boys lose today's $68-a-month plan, in favor of  the costlier but inferior bronze plan, too. Their new rate: more than $150 a month, for a percentage increase of 124.7%.

Ouch! The ACA's cheery image-burnishers want us to believe that this new law is uniquely kind to children needing coverage. Our rates tell exactly the opposite story. In our case, it's the kids who are being slapped with the steepest rate increase.

Is there any way to improve on the jacked-up premiums and diminished coverage of the Affordable Care Act? I deeply hope so. But the Kaiser mailing is not encouraging. As my new-premium letter declared in its second paragraph, in big, bold letters: "Everything is taken care of. There's nothing you need to do."