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Hearing Hearing Date: September 14, 2016 9:00 am 2154 Rayburn HOB

Examining the Affordable Care Act’s Premium Increases

Examining the Affordable Care Act’s Premium Increases
September 14, 2016
9:00 am
2154 Rayburn HOB
Full Committee on Oversight and Accountability

0914 ACAPremiums

  • Despite President Obama’s promise that the Patient Protection and Affordable Care Act (PPACA) would lower health insurance premiums, costs have steadily increased since enactment. Premiums are expected to increase at an even higher rate for the 2017 plan year than in either of the two previous years.
  • Major insurers are pulling out of the health insurance exchanges due to reported losses to the tune of hundreds of millions of dollars, resulting in fewer choices for participating consumers.
  • CO-OP programs are failing across the country with only six of the 23 programs still operating.
  • Some insurers are beginning to offer limited healthcare plans to offset the cost of premium increases. Consumers are switching insurance plans and doctors every year to limit personal increases.
  • Zero cases of fraud have been caught and prosecuted by HHS for consumers who are gaming the system.


  • To examine rising health insurance premiums under the Patient Protection and Affordable Care Act (PPACA).
  • To review: (1) the state of the health insurance market and the drivers of premium changes under PPACA; (2) the financial sustainability of health insurance exchanges created by PPACA; and (3) strategies used by insurers to limit premium increases and their impact on consumers.


  • Health insurance premiums have steadily increased since the enactment of PPACA and are expected to increase at an even higher rate in 2017.
  • Five major health insurers have warned they are losing hundreds of millions of dollars on plans sold on the exchanges and many insurers are pulling out of the exchanges due to reported losses.
  • A recent analysis shows there is an increase in the number of areas with only one insurer offering health insurance plans, predicting “nearly 36 percent of exchange market rating regions may have only one participating insurance carrier offering plans for the 2017 plan year and there may be some sub-region counties where no plans are available.”
Subcommittee on Government Operations Chairman Mark Meadows (R-NC): “[Rep.] Cooper said you’re not outraged. [Panel] do you buy your insurance from… Well, so perhaps they’re not outraged because they’re not having to use the system.”

Rep. Tim Walberg (R-MI): “When I talk to my rate payers back in my district, people who say ‘Yes I have insurance, but I don’t have health care. Because when I go in to take care of my health, I find out that my out-of-pocket expenses – it precludes me caring for my health.'”

Rep. Gary Palmer (R-AL): “I would expect that you would have some concern about the losses – I mean, Blue Cross Blue Shield of Minnesota lost $500 million, Health Care Service Corporation which own the Blue Cross affiliates in Illinois, Montana, New Mexico, Oklahoma, Texas – they lost 1.5 billion. … Can the companies you represent sustain those kind of losses and stay in the market?”

Witnesses and testimonies: Mr. Chris Carlson

Oliver Wyman, On Behalf of America’s Health Insurance Plans


Mr. Kurt Giesa

Partner, Head of Actuarial Healthcare Practice
Oliver Wyman, On behalf of Blue Cross Blue Shield Association


Mr. Al Redmer, Jr.

Maryland Insurance Administration, On behalf of the National Association of Insurance Commissioners


Dr. Mandy Cohen, M.D., MPH

Chief Operating Officer and Chief of Staff
Office of the Administrator, U.S. Department of Health and Human Services


Mr. Topher Spiro

Vice President
Health Policy, Center for American Progress


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