(Bloomberg) -- A few days back, David Goldhill, whose writing about health care I have long admired, wrote a column for Bloomberg View suggesting that the Obamacare health insurance exchanges would actually raise prices for insurance, as insurers converge around a single price for the reference product that sets the subsidies to be offered:

Goldhill’s argument is complicated. Here’s the gist: First, the subsidies are determined by the price of the second cheapest silver plan on the exchange. The system calculates what percentage of your income you’re supposed to pay -- for a family of four making $32,500, that amount is 3.29 percent of income, or a little more than $1,000 a year. The system looks at the second cheapest silver plan, and subtracts the amount that you’re supposed to pay. What’s left is your subsidy. If you buy a cheaper “bronze” plan, you can pay little or nothing, with the subsidy covering the whole thing. If you buy a more expensive plan, you have to make up the difference.

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