Report Sees Rising Premiums for Many Small Businesses Under Obamacare

Whitehouse.govWhitehouse.govActuaries from the Centers for Medicare and Medicaid Services (CMS) estimate that about two thirds of small businesses will see their health insurance premiums rise under Obamacare.

Via The Wall Street Journal.

The report analyzed employers with 50 or fewer full-time employees that buy outside insurance policies for workers, a group it estimated at 17 million people in 2012. It focused on a piece of the 2010 law that prevents insurance companies from pricing policies based on customers' health status.

Before this year, insurance companies could charge higher prices if an employer had older, sicker workers. Now, under the Affordable Care Act, insurance companies can't price on health status and are limited by the amount they can price by age.

The report concluded that about 65% of small businesses, or plans covering 11 million people, would see an increase in insurance premiums under these so-called community-rating provisions of the health law. About 35% of employers would see a decrease for plans covering six million people. 

The report looks narrowly at restrictions built into the law which limit higher premiums for sicker or older workers. It doesn't factor small business tax credits or other parts of the law that might affect premiums into the equation. And it doesn't indicate how large the increases or decreases might be. But it does highlight the way that Obamacare's rating rules change the cost calculous for insurers and for employers, and the ripple effects on coverage and costs that are likely to continue for a while into the future. 

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  • Fist of Etiquette||

    ...about two thirds of small businesses will see their health insurance premiums rise under Obamacare.

    But 40 million more people are receiving healthcare now.

  • The Other Kevin||

    This is where I bitch about health care costs going up significantly at my company, and PB tells us that only 0.0000000001% of Americans are affected by this in any way at all.

  • Palin's Buttplug||

    They were rising every year anyway by 10-20%

    The question is - will they rise more or less than past increases?

  • PapayaSF||

    Since when has a massive system of regulations, taxes, and subsidies ever caused the overall cost of anything to go down?

    How does an excise tax on medical devices make health care costs go down? How does a 2% tax on all health insurance plans make costs go down?

  • Paul.||

    How does a state or county limiting access to healthcare or expansion of services make costs go down?

  • Number 2||

    Hold on idiot. We were promised lower premiums across the board. Just like we were promised that we could keep our existing plans if we liked them. "They were going up anyway" is not an answer.

  • Paul.||

    Report Sees Rising Premiums for Many Small Businesses Under Obamacare

    Reports seem to see a lot these days. I'm more curious about what they don't see.

  • Number 2||

    "But it does highlight the way that Obamacare's rating rules change the cost calculous for insurers and for employers"

    Cost calculous? Good one -- and fitting, too. I've known a number of cost calculouses in my life.

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