Obamacare Rate Deadlines Pushed Back as Inflation Stalls
August 11, 2017
Insurance companies are waiting to hear about the future of Obamacare. The EPA is looking to roll back standards for fuel economy despite industry pushback. Inflation continues to rise slowly and the housing market is becoming increasingly unaffordable.
- Obamacare rate deadlines pushed back three weeks amid uncertainty. Insurance providers, frustrated with the lack of long term commitment on cost sharing reduction payments from the Trump administration, have been granted a delay. The deadline for filing new rates will now be September 5, with a final deadline on September 20, three weeks after the initial deadlines. However, Health and Human Services was unable to provide the insurers with any word on the long-term commitment of the White House to making the payments, leading the companies to threaten higher rates or even an exit the market. [The Hill]
- EPA, White House consider rolling back fuel economy goals earlier than expected. The EPA said it would consider loosening emissions standards beginning in 2021 on Thursday, rather than 2022 as originally planned. The Obama administration finalized fuel economy goals staggered to lead up to an industry wide standard of 54.5 MPG by 2025. The auto industry claims this goal is too high, given current car consumption habits, and asked the current administration to reconsider. It seems they are doing just that; the Department of Transportation is similarly reconsidering fuel economy standards, and the agencies will likely coordinate their efforts to loosen standards. The EPA will have to finalize its standards by April of next year, with regulation changes would be subject to the full rulemaking process. [The Hill]
Economic Indicators & News
- Consumer prices rise slightly; inflation tepid. The consumer-price index, which measures what Americans pay for just about everything, rose 0.1% this past month. The so-called “core prices,” excluding volatile food and energy, also rose 0.1%, below expectations of a 0.2% rise. From last year, overall prices are up 1.7%. While apparel costs are up, shelter costs, driven down by lower hotel and dorm prices, are growing very slowly. The slow rising cost of goods is the Fed’s latest indication that inflation is not meeting expectations. The CPI tends to run a little higher than the price index for personal consumption, the Fed’s typical inflation barometer, which has run flat for the second straight month. While low unemployment is a welcome sign to the Fed, low inflation might give it pause as it contemplates rate hikes. [WSJ]
- Home affordability drops slightly. A robust job market has fueled an uptick in housing prices and demand, weighing down the number of homes sold that would be affordable to a median income household. Higher home prices from higher demand have been offset by low mortgage rates and growing incomes. The average mortgage rate fell from 4.33 to 4.08 in the first quarter, which, coupled with solid employment, has enabled more people to afford home ownership. The least affordable housing markets were all in California, with San Francisco topping the list, where only 7% of homes sold were affordable to a household with the area’s median income of $113,000. [The Hill