Wharton Study Demonstrates Why Obamacare Exchanges Are Floundering

Wharton Study Demonstrates Why Obamacare Exchanges Are Floundering

Remember when President Obama said Obamacare was working “better than intended“? Perhaps he should pay closer attention to what the person in charge of Obamacare is really saying. DHHS Secretary Burwell announced in a conference call last week “We believe 10 million is a strong and realistic goal” for enrollment in the Obamacare exchanges in 2016.

That may sound like things are hunky-dory, but POTUS and the public need to read between the lines. Hitting the 10 million target means that the Exchanges will enroll only 900,000 more people than they did this year. Moreover, it is only half the 2016 level that the Congressional Budget Office predicted merely four months ago! Sadly, this is just the tip of the iceberg. University of Minnesota finance professor Stephen Parente has shown that by late 2016, Exchange premiums are likely to roughly double for individuals covered under the most popular Bronze plans. Consequently, the number of uninsured is expected to gradually rise beginning in 2017 as enrollment in the non-group market begins to decline.

A new Wharton School study explains in a nutshell what is happening. Except for those who are heavily subsidized, Obamacare coverage is a really bad deal for the uninsured . Consider the poorest members on the Exchange (family income equivalent to 138-175% of poverty). Even after subsidies, the net premium paid by such families to obtain a Silver plan will be nearly triple the average amount they would have spent out of pocket had they remained uninsured!

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