Question

After the legislation is passed, what will happen to the price of medical insurance and the number of medical insurance policies sold?

Answer 1

So let us understand in numbers first the impact on insurance when the Obamacare Replacement Becomes Law. 24 million of Americans will lose coverage by 2026, and the rest of Americans will probably see the deductibles go up.

How will it impact the insurance premiums? For older people, premiums will go up. Premiums on the individual market will go up by 15 to 20 percent. With the tax penalty repealed, the young, healthy people who choose to go without insurance won’t be paying into insurance plans. That means premiums have to go up for the people who stay. Eventually by 2026, premiums will end up slightly cheaper than they would be if we continued under the Obamacare. However there is a point that needs attention, Premiums will be cheaper because insurance will cover less. A person will not get the same coverage for less money, he os juts getting less coverage than before. People will be on the hook for more costs through high deductibles and cost sharing.

There will probably be plenty of lower coverage plans available, which are the cheapest kind.

And how will all this impact the number of insurance policies sold. With the tax penalty repealed, the young, healthy people who choose to go without insurance won’t be paying into insurance plans. There will be many people who will chose to not buy insurance when premiums get too high. Older people face serious premium hikes; younger people won’t be as hard hit, but other changes mean insurance won’t be as good a deal for them. 4 million people are estimated to stop buying insurance because the tax penalty won’t be enforced as there are people who currently have insurance only because they are afraid of the penalty, and there will be another 14 million people who would otherwise be eligible for Medicaid who would stop buying insurances.

If we look at the overall impact of the legislation, people will be unable to afford insurance if they are older or if have a low income, or if they live in an area where insurance tends to be very expensive.