Health-plan rates are jumping in many states. Meanwhile, Washington state awaits new figures on health plans here.

Share story

The Obama administration released the prices for many Obamacare health plans Monday, and they showed big increases in many parts of the country. Obamacare customers will begin shopping for new plans next week, just a few days before the presidential election.

The news about the federal health exchange fanned political interest in the health law — both presidential campaigns were talking about the topic Tuesday — and whether its structure of private insurance markets is sustainable. The health law will almost certainly stay on the minds of politicians in the next administration: Both Hillary Clinton and Donald Trump have proposed substantial changes to it.

Because Washington has its own state-based exchange, customers in the state purchase individual insurance plans from that exchange, called Washington Healthplanfinder. Final information about Washington state’s plans and rates for the individual health-insurance market haven’t been released and were not included in the federal report issued by the department of Health and Human Services this week.

Preliminary figures reported in May in the state showed that 13 insurers had filed 154 individual health plans for 2017, with an average rate increase of 13.5 percent. New figures are expected to be released Wednesday morning.

Here’s a quick guide to what’s happening across the country and who will be affected.

Obamacare Rates Are Going Way Up.

The latest estimate from the federal government is that the average midlevel Obamacare plan, the most popular choice, will cost about 22 percent more in 2017 than it did in 2016. This is based on data from 39 states where people sign up through the website and some preliminary data from four other states and the District of Columbia.

There is big variation nationwide. Customers in Phoenix are looking at a premium increase of 145 percent, while customers in Providence, R.I., are looking at a 14 percent decrease, according to a Kaiser Family Foundation analysis.

This Is Not a Huge Surprise.

There have been signs for months that insurance rates for people who buy individual policies would rise more next year than they have in previous years. There are a number of reasons, including the fact that some of the programs meant to keep rates lower are ending at the end of this year. Also, many insurers mispriced their plans in the early years of the law and have either left the market or have had to raise their prices sharply to cover the cost of providing coverage. The insurers say they need higher rates to pay for the expensive medical care that so many people are receiving under the law.

The 2017 premiums are actually a pretty good match for what the Congressional Budget Office forecast back before the Affordable Care Act passed in 2009. The big question now is whether this is a one-time jump in the rates — or the start of ugly increases from now on.

These Increases Really Matter Only For Those Who Buy Their Own Insurance.

Most people are unaffected by the rate increases because they get their insurance through an employer or are covered through government programs like Medicare, Medicaid or the Department of Veterans Affairs.

Only a small fraction of Americans who have insurance buy individual policies. There are about 10 million people in the Obamacare markets plus around 7 million who buy health plans outside the marketplace, according to Obama administration estimates. The published rate increases apply only to people who shop in the markets, but premiums are expected to go up sharply for the other plans as well.

If You Get a Subsidy, and You’re Willing to Switch Plans, You Won’t Have to Pay More.

More than 80 percent of Obamacare customers get subsidies that help them pay the cost of their premiums. Those people do not pay the full cost of insurance out of their pockets, and they will not feel the full brunt of these increases, as long as there is a less expensive plan available in their market and they are willing to switch.

People who don’t get subsidies will be the ones hardest hit by the increases.

Customers May Have to Switch Plans to Save Money, and Switching Health Plans Can Be a Big Deal.

Obamacare plans tend to cover a narrow group of doctors and hospitals, so people who change their plans may also have to find new health-care providers. For healthy people, that may not matter, and they may just want to find the cheapest policy. But patients with complex health needs may have a hard time abandoning a hospital or doctor and starting over with new ones. That means that the sickest patients either have to suffer the inconvenience of switching all their doctors and records around, or they’ll have to stomach the biggest increases.

Annual switching is a feature, not a bug, of Obamacare. The law relies on market competition to keep premiums as low as possible. If customers aren’t willing to change into the cheapest plans, the insurance companies won’t have any incentive to compete on price.

If You Get Insurance Through Work, You Don’t Have to Worry Too Much About This News.

The health law is much bigger than just the Obamacare exchanges, and many of the new rules offer protections against having coverage that is too skimpy. Your health plan must cover basic services, like drugs and hospitalization; basic preventive services provided by your doctor, like a checkup, a flu shot or a mammogram, can be free.

Premiums for employer-based insurance have been increasing at historically low rates. What has probably changed is the size of your deductible, which has been going up steadily. Employers have been shifting costs to their workers, a trend that began long before Obamacare arrived.

Of course, federal tax dollars pay for the subsidies for low-income people who buy insurance in Obamacare markets — about $32 billion this year, according to the Congressional Budget Office. If premiums rise by more than 20 percent every year, that will put pressure on the federal budget.

People Buying Their Own Insurance Should Shop Around for the Best Deal.

Average numbers aren’t that useful to a person buying insurance in a particular place. If you already have Obamacare insurance or are buying it for the first time, you need to go to your state exchange website and look at the choices available to you. If you are eligible for a subsidy and willing to switch plans, your costs might actually go down. If you’re not eligible for a subsidy and live in one of the places with big price spikes, finding affordable coverage may be more of a struggle. Wherever you are, it pays to see if there’s a plan that’s similar to yours and has a better price.

Even if you don’t want to shop, you may have to. Several large insurance carriers, like UnitedHealth Group and Aetna, have decided to exit many of the places where they had been offering policies.

Some Markets Are Not Functioning Well.

It’s hard to generalize about whether Obamacare is “working” everywhere. But the combination of insurer exits and sharp price increases is a sign that the markets are in trouble in at least a few parts of the country. Some markets have only one insurer offering plans, or sharply higher prices. That’s a bad sign for a system built around choice and market competition.

Fixing What Ails the Markets Is Complicated.

There are a number of policy proposals out there to help stabilize the Obamacare marketplaces. But experts have not coalesced around one simple fix that by itself can solve the problems. Some of the suggested changes involve complex regulatory changes, but most are legislative.

Clinton has said she’d like to introduce the public option, a government-run insurer, in markets with limited competition. She has also discussed letting middle-aged Americans buy Medicare.

Trump says he wants to repeal the Affordable Care Act and start over with a new system for buying and selling health insurance.