Report: Fear of high ObamaCare premiums ‘unfounded’

Fears that insurance premiums will spike next year are premature, according to a new report that argues market competition will likely keep costs from rising. 

Critics of the Affordable Care Act have long warned that premiums for the ObamaCare plans would skyrocket in 2015 as insurers scrambled to make up for setting artificially low prices this year. Researchers at the Robert Wood Johnson Foundation argue those fears are misplaced.

{mosads}“In competitive markets, unless all insurers behave similarly, those that increase premiums will suffer the loss of a market share to those that continue to price more aggressively,” said the authors of the report released Monday. The competitive pressures mean insurers are unlikely to risk raising their premiums too high for fear of losing customers, the report says.

Researchers compared data on premium costs in eight states around the country and found competition in the insurance markets was typically high, especially in the cities. They say the same competitive factor that led to low premium rates this year is likely to keep prices in check next year.

However, the report says some rural states may see higher premium prices because there are fewer insurers and therefore less competition.

The report also said the number of enrollees in ObamaCare will grow as the years go on, spreading the amount of risk insurers have to bear and relieving the need for price hikes.