As Hillary Clinton and Donald Trump spar daily over the future of Obamacare, officials in Minnesota have admitted it’s on life support in the state because of soaring premiums.
Mark Dayton, the Democrat Governor of Minnesota who was one of the Affordable Care Act’s most zealous supporters when it was first implemented five years ago, declared this week that the system in the state was suffering an “emergency”.
His comments came days after Bill Clinton dropped a grenade into the presidential race by offering his own negative assessment of the law while campaigning on behalf of his wife, Hillary Clinton.
In what was widely seen as an embarrassing gaffe, the former President told a rally in Michigan last week that Obamacare had become the “craziest thing in the world” and that consumers “wind up with their premiums doubled and their coverage cut in half”. Republicans, who have argued the law should be scrapped, seized on his comment.
Minnesota appears now to be emerging as exhibit A of what Mr Clinton was talking about with insurance companies either opting to remove themselves from the system entirely or, if they remain, vowing to raise rates dramatically.
“Ultimately, the reality is that the Affordable Care Act is no longer affordable for an increasing number of people,” Governor Dayton told reporters. “It's got some serious blemishes right now and serious deficiencies.”
Under pressure from the insurance companies still participating in Minnesota, the state commerce commissioner Mike Rothman has authorised premium increases for 2017 of between 50 to 67 per cent over this year’s premiums. That follows price hikes for 2016 of 14 to 49 percent, making it three straight years when costs to consumers will have jumped.
The first blow in Minnesota came when Preferred One, an insurance company that once accounted for 59 per cent of all plans brought through the Obamacare exchange, simply pulled out after declaring it was no longer economically viable. The state's largest insurer, Blue Cross Blue Shield of Minnesota, also plans to pull out.
Consumers feeling the pinch include Madeline Sherman of Minneapolis, who is self-employed and recently received a letter saying her costs will rise from $200 (£164) a month to about $265. “I am a little worried. If it keeps going up I am going to have to look at the options,” she said.
“I think that the idea behind Obamacare is great, the concept,” Ms Sherman added. “But if they are going to keep raising the rate, there is really no a point. The whole point was to help people with lower incomes to get insurance they could afford and it’s really getting to the point where I can’t afford it any more.”
The presidential candidates clashed over the fate of the law at their debate last Sunday. “Obamacare will never work. It's very bad,” Mr Trump averred. He has consistently vowed to scrap the law though he has been vague about what he would replace it with.
While she acknowledges that the law as it is set up now is encountering problems, Ms Clinton continues to argue that it can be salvaged with reforms. “I'm going to fix it,” Ms Clinton told the debate audience at Washington University in St Louis. “I want very much to save what works and what is good about the ACA. But we've got to get costs down.”
Unless insurance companies can be persuaded to participate in the Obamacare exchanges – two giant companies, Aetna and UnitedHealth, have both announced plans to pull out of markets in several other states – costs are certain to keep rising. That puts pressure both on consumers who buy plans on the exchanges and also on the system of subsidies for consumers under certain income levels.
Jennifer, another Minneapolis resident who withheld her second name, has her premiums paid for by the government. Yet, she has also concluded that Obamacare is beyond repair.
“It should go bye-bye, it should go back to the way it was” she said on Friday, saying that in her view it was set up as a means for the government to keep track of citizens. “It’s not for our benefit, it’s for theirs.”
“I have talked to a lot of people and there are a lot of high premiums that some people have to pay and if you don’t get the Obamacare through the state, you have to pay fines and taxes and that’s just ridiculous.”
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