Premiums on the individual market will rise by an average of 15% next year, mostly due to Congressional Republicans' repeal of the individual mandate, the Congressional Budget Office (CBO) said on Wednesday.
The nonpartisan federal agency said (PDF) repealing the penalty for not having insurance will contribute to a 10% spike in premiums for plans under the Affordable Care Act next year, due to younger, healthier people leaving the exchanges. Premiums will increase by about 7% per year between 2019 and 2028, according to the CBO.
Additionally, the number of uninsured Americans is projected to rise by 3 million next year, also mainly as a result of the mandate repeal, which was part of the GOP's tax overhaul last year. Overall, 1 million fewer people will have health insurance in 2028 than do this year (244 million compared to 243 million).
The mandate repeal isn't the only policy change affecting premiums and the uninsured rate. The Trump administration's proposed extension of short-term, limited duration plans is expected to reduce the uninsured rate by 1 million in 2023 and each year thereafter. Exchange plan premiums will increase by 2% to 3% per year as a result of more people leaving the marketplace for such plans.
The premium increase estimated by the CBO is much lower than the 6% estimate by the Chief Actuary for the Centers for Medicare & Medicaid Services. Some estimates have pinned future increases as high as 16%.
However, the CBO seemed to agree with the actuary that the number of people leaving the marketplace for short-term plans is closer to 1 million, five times higher than what the Trump administration expected, which many considered to be a lowball estimate.