The Office of the Insurance Commissioner recently released the premium rates for 2018 in the Obamacare Washington State Health Benefit Exchange. (here) No surprise, the rates are going up. The surprise is that they are going up 24 percent – the largest yearly increase since the exchange opened in 2013.

The 180,000 customers in the exchange will also have fewer choices. In King and Pierce Counties, the number of insurance carriers will drop from seven to four, in Kitsap County from four to three, and in Snohomish County from six to three.

There are multiple reasons given for the rate increases, including the uncertainty of Congressional health care reform action, the uncertainty of the future of the cost-reduction subsidies, and the uncertainty of the enforcement of the individual mandate to purchase health insurance.

All of these uncertainties neglect to consider the fundamental structural problem with Obamacare. The Affordable Care Act (ACA) forces everyone to buy insurance plans that are designed by bureaucrats and are loaded with benefits that not everyone wants or needs. By design, young and healthy individuals are essentially priced out the insurance market. They would rather either pay the penalty for not having insurance or use a government-approved exemption to owning insurance. This leads to adverse selection.

The structure of Obamacare exacerbates the problem further by its pre-existing condition clause. The young and healthy can simply wait until they become sick and then purchase insurance.

The Obama Administration determined that at least 40 percent of people in the exchanges needed to be young and healthy to offset the costs of older and sicker individuals. To date, no more than 28 percent of enrollees have been in the young and healthy category. Consequently, insurance carriers must increase premium rates for those people remaining in the exchanges to cover their costs.

Proponents of Obamacare and the exchanges opine that the increase premium rates don’t matter because the taxpayer subsidies will simply increase to offset the higher premiums. This is true for now, but at some point the costs for sick patients in the exchanges will go so high that insurance carriers will bail out of the exchanges completely.

Health insurance premium rates are not stabilizing in the exchanges, as predicted by Obamacare supporters over the past several years. In fact, they are increasing at an alarming rate and are forcing a death spiral in the exchanges and potentially the entire individual health insurance market. The ACA is a complex, partisan, and poorly designed law that needs to be repealed and replaced with a patient-centric and not a government-run health care system.