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The mere threat that Obamacare will be dismantled or radically changed — either by Congress or by President Trump himself — has persuaded several big insurance companies to stop selling policies or significantly raise premiums. The practical effect is that some lower-income and middle-class families may have no good options for insurance and will have to spend more on health care.
There’s no new Affordable Care Act yet; the House passed a very bad bill, but the Senate has yet to act. Still, in places like Iowa, Nebraska and Tennessee, companies such as Aetna and Wellmark are so spooked by the uncertainty that they are considering abandoning the market. Other insurers are asking state regulators for permission to raise premiums by as much as 53 percent. This should trouble not just the 12.2 million people who have bought insurance on federal and state exchanges, but also policy makers, since Washington may have to spend more on subsidies if premiums go up.
Mr. Trump, not surprisingly, describes things differently. He claims that uncertainty in the insurance industry is evidence that Obamacare is collapsing and needs repeal, not that he and his allies have created the uncertainty. This is disingenuous nonsense. On the whole, insurance markets in much of the country are on stable footing and will remain so if Congress doesn’t do things to undermine Obamacare, according to a March report by the Congressional Budget Office. And insurers selling policies under the A.C.A. actually did better financially in 2016 than in the year before, according to an April report by Standard & Poor’s.
So, why are insurers fearful and threatening to quit Obamacare or jack up premiums? There are a few big reasons. First, the House passed a bill this month that would take insurance away from at least 24 million people by slashing spending on Medicaid and cutting the subsidies the government uses to help people buy insurance. Second, Mr. Trump has threatened to stop making about $7 billion in payments to insurance companies to help lower the cost of co-pays, deductibles and other out-of-pocket costs for lower-income and middle-class families. If the administration carries out that threat, insurers would raise premiums by about 19 percent, according to the Kaiser Family Foundation. Third, insurers are worried that the Trump administration will stop enforcing the A.C.A. provision that requires people to buy health insurance or pay a penalty. That could hurt them by reducing the number of younger and healthier people who sign up.
It can be hard to feel sympathy for bureaucratic and faceless insurance companies. After all, they often deny people access to medical procedures and drugs. But Mr. Trump and his Republicans in Congress have left them with little choice. They can stay with the exchanges and risk large losses if elected leaders blow them up, or they can pull out now, or raise rates, in parts of the country where it is harder to make money.
What’s bizarre about the Republican strategy is that it is likely to cause the most damage where many of Mr. Trump’s supporters live. Rural and suburban areas are more likely to lose insurers and see big premium increases if Obamacare goes down, because companies have less incentive to stay in markets where there are fewer potential customers and where it is harder to put together networks of hospitals and doctors.
Republicans might hope that blame for any future problems with Obamacare will fall on former President Barack Obama and the Democrats. A Kaiser poll, however, shows that 61 percent of Americans already know where the fault should lie: with the Republicans who are now in charge. Another poll from Gallup found that Obamacare became more popular than ever after Republicans began trying to destroy it. Senate Republicans ought to keep these polls in mind as they come up with their version of Trumpcare.