Unfortunate news broke the health insurance world in the last month in the form of the announcement of the rising costs of insurance premiums under the Affordable Care Act, also known as Obamacare. These new increases will go into effect in 2017 and plans have increased by as much as 116%. This increase is leaving many Americans currently insured under a plan from the Affordable Care Act feeling confused and dismayed at the idea that their premiums would skyrocket.  However, it appears that the majority will not see a massive increase.

Higher Sticker Prices

It is true that the “sticker price” of insurance premiums are going up an average of 22% across the board. The increase varies based on the state. Some states such as Indiana and Massachusetts will see small decreases of up to 3%, some will see no difference at all, and other states such as Arizona and Pennsylvania will see premium increases of up to 116%.

For those in the states with significant increases, especially, the increase is quite shocking It is understandable that consumers might be surprised and even upset by the news considering that one of the highest priorities of the Affordable Care Act is for insurance to be affordable.  While there will be some consumers sorely affected by the increase, thanks to other provisions of Obamacare, most will not.

More Credits and Deductions

The good news in this situation is that, in correlation with the increases seen in the plan sticker costs, there will also be an increase in the credits and deductions available under the Affordable Care Act.  TheFederal Treasury will fund those deductions, and most consumers who currently have Obamacare will be eligible.  With these deductions, low and mid-level income households should not see a major increase and may not see an increase at all.

Those Who Will be Affected

The group who will be hardest hit by the higher sticker prices will be those individuals who earn more than four times the poverty level.  The amount varies based on your household size, but for an individual that amount is $47,520 and increases from there with additional household members.  Those who earn more than the set amount are not eligible for any subsidies. They will have to pay the full sticker price which could now be more painfully than it was previously.

It is important to note, that the majority of those who currently have an insurance plan purchased under the Affordable Care Act do not meet that level of income.  Because most Obamacare consumers are below four times the poverty line, most will be eligible for the reductions. In fact, 77% of those with plans currently would still be able to pay less than $100 a month.


There is no denying that this increase in premiums under the Affordable Care Act is disappointing.  Some Americans are going to be several affected by these hikes and may be in the same situation they were before, where they can no longer afford insurance. However, as frustrating as seeing an increase in rates can be, the reality is that most consumers insured under Obamacare will not see those increases passed along to them.

Whether these increases will continue, or if there ever will be a relief to those who do not currently qualify for the subsidies, it is uncertain. With new leadership taking over the country, there are sure to be many more changes to the Affordable Care Act to come. How the everyday consumer will be affected in the new round of changes

To voice your concerns contact Skyline Risk Management, Inc. at (718) 267-6600