For the administration, major rate hikes present two distinct problems. First, they threaten to undermine or weaken the ACA structurally, by prompting unhappy customers to ditch their plans. Second, they pose a political threat to Democrats in general and Hillary Clinton in particular, since the presumptive Democratic nominee has fully embraced the ACA in her campaign against Donald Trump, who has predictably seized on news of rate hikes to denounce Obamacare as a failure.

The Obama administration is eager to point out, however, that even dramatic rate hikes won’t necessarily hit the most vulnerable customers hard. The great majority of Obamacare policyholders receive premium tax credits and a large portion receive additional subsidies that limit their out-of-pocket expenses. For the latter group, monthly costs only rose $4 last year, despite much greater overall premium increases.

One problem that will handicap the administration’s attempts to keep premiums down is the elimination of funding for “risk corridors,” which were intended to help insurers absorb losses in the first years of the ACA. Sen. Marco Rubio championed the elimination of the program in an end of year budget compromise, saying it amounted to a “bailout” of bad business decisions.

Finally, as long as the cost of prescription drugs continues to rise, it is hard to imagine health insurance premiums will not as well. A report in The Wall Street Journal found that many major pharmaceutical companies are attributing greater sales of their drugs to increased prices.

As premiums increase and drug costs increase, policymakers are faced with competing arguments over how to reduce the overall cost of care to consumers. Insurers seeking to merge — Aetna and Humana; Anthem and Cigna — argue that their mergers will help them negotiate better prices with drug companies and providers, a claim that consumer advocates find unconvincing but some regulators may find appealing.