Smart. Sharp. Funny. Fearless.
Thursday, June 21, 2018

New Yorkers will see insurance premiums that are at least 50 percent lower than what they currently pay when the Affordable Care Act takes effect, Governor Andrew Cuomo (D-NY) announced Wednesday.

As House Republicans prepare to vote Wednesday afternoon to repeal both the individual and employer mandates of Obamacare, this “triumph” for the health care law shows exactly why the individual mandate is crucial to bringing down high health insurance prices.

New York State already has both “community rating” and “guaranteed issue,” which means people cannot be charged more or turned down for coverage based on an existing condition or health risk.

Likewise, Obamacare ends the ability of insurers to deny coverage or charge more based on “pre-existing conditions.” But New York didn’t have a requirement for people to be insured. Thus private insurance companies took on the risk of covering the sickest New Yorkers and in return, they passed the costs on to those who could afford to purchase coverage. As a result, the state’s rates could be as high as double the national average.

“If there was any state that the ACA could bring rates down, it was New York,” said Timothy Jost, a law professor at Washington and Lee University.

Screen Shot 2013-07-17 at 12.50.45 PM

In May, Deloitte had predicted that the average individual would see a 13.9 percent reduction in rates. But even with a 50 percent reduction, the cheapest plan in New York City is still $359 a month, the Washington Post‘s Sarah Kliff notes, before government subsidies.