Saturday, January 25, 2014
Bailout of the Rollout
To extricate from a difficult situation.
The initial public exhibition of a product
For the Obama administration, rollout of ObamaCare via healthcare.gov has not been a barrel of fun.
Instead, it has afflicted a blow, perhaps a mortal blow, on prospects of the health law’s success. Indeed, because of adverse selection and frustrations of the old and the sick and insured signing up for health exchange plans, rather than the young and the well and the uninsured enrolled, insured companies may go bankrupt. Should that occur, it would spell the end of ObamaCare.
But fear not. The government and health law writers foresaw these problems:
One, the government became masters of the art of bailout. The government bailed out GM. It bailed out Wall Street. It is in the process of bailing out the unemployed and uninsured. Why not bail out the insurance industry too? After all, it’s the taxpayers’ money, other peoples’ money, not government money.
Two, the administration wrote health law so arcane and so labyrinthic, that it had to pass it to find out what was in it. What was in were such things as insurers could only issue plans covering every kitchen and sink “essential benefit”, free rides for those with pre-existing conditions , parents covering their “children” up to age 26, and other assorted goodies, and sections 1341 and 1342 in the Patient Protection and Affordable Care Act, the latter two provisions just in case things went South.
Charles Krauthammer, in a January 3, 2014 Washington Post column, calls these sections “Plan B,” written should “Plan A,” full-fledged and fully- adorned ObamaCare flounder.
Section 1341, the reinsurance fund, is there to bail out insurance companies to the tune of $63 per head, which amounts to $20 billion over 3 years.
Section 1342, the risk corridor fund, is there to pay insurance companies up to 80% of their losses while ObamaCare is being implemented.
Krauthammer recommends Congress pass a bill one-sentence long “Sections 1341 and 1342 are hereby repealed” and pass it along to the Senate for a vote in that august body. Should the Senate pass the bill, Krauthammer maintains, that would end “Plan B,” the fall back position to save ObamaCare.
“Such a bill,” Krauthammer goes on, “ would be overwhelming popular because Americans hate fat-cat bailouts of any kind. Why should their tax dollars be spent not only saving giant insurers but also rescuing this unworkable, unbalanced, unstable, unpopular money pit of a health-care scheme?”
Krauthammer continues, “who can argue with no bailout? Let the Senate Democrats decide. Support the bailout and lose the Senate. Or oppose the bailout and lose the Senate?
Of course, the Senate bill will never be voted upon. Senate majority leader, Harry Reid, would never allow it to come to a vote. And even if it did, President Obama would veto it. A living dog, the reasoning of the Senate majority leader and the president, will go, is better than a dead dog.
Tweet: Should ObamaCare cause insurer bankruptcies, the Obama administration will bail oit insurers out as spelled out in sections 1341 and 1342 of the health law.