Saturday, May 25, 2013

Obamacare Seems to be Working in California

The prices for health insurance on California's Health Exchange have been advertised, and they are lower than many experts expected:
Health insurers will charge 25-year-olds between $142 and $190 per month for a bare-bones health plan in Los Angeles. A 40-year-old in San Francisco who wants a top-of-the-line plan would receive a bill between $451 and $525. Downgrade to a less robust option, and premiums fall as low as $221.
Obama's plan also provides subsidies for people earning up to 400% of the poverty line income. Below is the chart showing the amount of the subsidy (green) and the resulting price for a mid-range "silver" plan for a 40-year-old single person:

I find it baffling that so many Republicans have opposed the health exchanges, because they are capitalism in action. The idea is to force health insurers to compete against each other by cutting through the price confusion, making them post a publicly advertised price and simple list of benefits on the exchange. That way people can easily see what they are buying and how much it will cost. Not only is this supposed to help   people buy insurance, by creating clear price competition it is supposed to get insurers to work harder to keep costs down.

It is sad that Republicans are determined to keep this from working rather than try to make it work better. We'll see what happens when Californians can buy affordable health insurance from their functioning exchange and Texans can't.

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