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How Obamacare Failed Iowa…According to Iowa

The Iowa Insurance Division, an arm of state government, explained how Obamacare failed the state and requested regulatory relief from the Trump administration.

The Affordable Care Act

Obamacare turned a “stable” individual health insurance market in Iowa into an expensive, failing market with few options, according to a new report by the Iowa Insurance Division.

The 33-page document is a striking read on how Obamacare – or the Affordable Care Act (ACA) – not only fell short in Iowa, but made the individual market worse for both customers and the state.

BEFORE OBAMACARE: IOWA WAS “STABLE”

Iowa noted that the market was fine before Obamacare, or ACA:

Prior to the ACA, Iowa had a stable individual market with some of the lowest premium levels in the nation. Iowa has a population of just over 3 million people, and nearly sixty-six (66) percent of Iowans had access to employer-sponsored insurance. Prior to the implementation of the ACA, Iowa had one of the highest health insurance coverage rates in the nation with less than 9.7 percent of its residents being uninsured.

OBAMACARE PASSED, PREMIUMS ROSE

Iowa said that insurers underestimated premiums at first, which led to so-called ‘sticker shock’ years later:

After 2014, it became apparent that many of the newly insured individuals in Iowa’s individual ACA-compliant market were much sicker and older than previously estimated. This caused significant losses in ACA-compliant markets around the country eventually forcing premiums to skyrocket. Iowa’s individual ACA-compliant premiums have increased between seventy (70) and one-hundred (100) percent over the first three (3) years of the ACA. Consequently, this has resulted in declining enrollment of healthy individuals along with poor uptake by the younger population.

2017: “ZERO” CARRIERS?

Iowa went through a series of insurers failing or dropping out of the individual market. CoOportunity Health, Inc. was liquidated in December 2014. UnitedHealthcare announced in April 2016 it would leave the market in 2017. Wellmark and Aetna announced their intentions to leave in the course of one week in April 2017.

Iowa predicts that the “larger collapse” of the market will lead to “ZERO carriers” in the individual market in 2018. This challenges one key Democratic argument: that Republicans are to blame for the collapse of Obamacare. In Iowa, the market has been collapsing since 2014.

WHAT NOW?

Iowa is asking the federal government for permission to make changes to its market, including subsidies that Bloomberg reported “are similar in structure to a Republican plan that passed the House of Representatives,” the American Health Care Act (AHCA).

President Trump planned to meet Tuesday with 13 GOP senators on Obamacare repeal. Sen. Joni Ernst (R-IA) will be there, so Iowa’s request – and the collapse of Obamacare in the Hawkeye State – may come up.