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The Affordable Care Act is alive—but not exactly well, thanks to years of Republican sabotage and popular vote loser Donald Trump's malfeasance. A six-week open enrollment period starts Wednesday, and it's going to be confusing. Most people will either hear "Obamacare is dead" or "premiums are skyrocketing," and that's almost certainly going to suppress enrollment.
While it is true that Trump's sabotage has led to premium increases in pretty much every market, a key thing for people to understand is that that very sabotage might mean they'll have lower premium costs and Obamacare could be an even better deal for them this year. That's because the adjustments that insurers have had to make to offset the loss of payments they'll be getting from the Trump administration for cost-sharing reduction mean that the subsidies that customers get will also be adjusted. The end result: some customers who qualify for premium subsidies will pay less than they did for their premiums this year.
Premium subsidies are based on silver plans, the same plans that are also eligible for the cost-sharing reduction payments that insurance companies are required to pay. In lots of states, insurance companies loaded the cost of losing those CSR payments from the government onto their silver tier plans. The premium costs for that tier going up means the premium subsidy level for all customers who qualify goes up, and even better insurance will be more affordable.
For consumers who receive premium tax credits, the amounts that they will have to pay will often be lower in 2018. The particularly large increase in premiums for silver plans means that tax-credit-eligible Marketplace enrollees will see much higher premium tax credits (which are calculated based on the second-lowest-cost silver plan in each area). These large credits make gold plans more easily attainable and make bronze plans much cheaper (or even available at no additional premium). In fact, after these increases, the lowest-cost gold premium is lower than the lowest-cost silver premium in 459 counties.
For example, a 40-year-old individual making $35,000 (249% of poverty) and eligible for a tax credit will on average pay 39% less in 2018 for their share of the premium for the lowest-cost bronze plan, 7% less for the lowest-cost silver plan, and 13% less for the lowest-cost gold plan. The savings are greater for subsidized enrollees with lower incomes and less for those with higher incomes (Table 2). The premiums for bronze plans may be particularly attractive to many people eligible for premium tax credits. For example, the tax credit for a 40-year-old individual making $25,000 covers the full cost of the premium for the lowest-cost bronze plan in 1,540 counties.
By the way, this is why Trump's sabotage of Obamacare is going to end up costing the government (and taxpayers) so much—it's hiking up the amount of money the government will pay out in premium subsidies. But it means that really great health insurance—those gold level plans with lower deductibles—is within reach for many more people.