and the November 1 Insurer Waiting Game
will see large rate increases for the first time Nov.1 – a week before they go
to the polls. Proposed rate hikes are just starting to dribble out, setting up
a battle over health insur”ance costs in a tumultuous presidential election
year that will decide the fate of ObamaCare.
Demko, “ObamaCare’s November Surprise,” Politico,
May 2, 2016
As the September Song lyrics go,
“Oh, it's a long, long while from May to
But the days grow short when you reach September
When the autumn weather turns the leaves to flame
One hasn't got time for the waiting game.”
The Obama administration and the Hillary Clinton campaign
are anxiously awaiting health insurers announcement for premiums hikes on November 1, 2016.
The last thing Democrats want just a week before the
Presidential election are double-digit insurance
hikes as millions of Americans begin signing up for ObamaCare. Premium hikes are expected to average over
10% - 15%as compared to an average of 8% in 2016.
Dramatic spikes of 20% to 50% have already been requested in New Mexico,
Maryland, Tennessee, and North Carolina.
The insurers’ problems are two fold:
One, they have been unable to choose who to insure.
Two, they do not know how much to charge because they
cannot, based on medical histories.
So insurers have been shooting in the dark. They have experienced heavy losses on
ObamaCare exchanges. UnitedHealth, the
nation’s largest insurer, pulled out of exchanges in 34 states, after suffering losses of $475 million in
2015 and a projected $650 million in 2016.
Aetna says it expects to break
even in 2016, but legislative fixes are needed if it is to stay in the game. Blue Cross Blue Shield will remain in 14
states has also experienced heavy losses but says will continue to insure exchange
customers, as will Anthem and Centene,
the nation’s largest Medicaid insurer.
The future of ObamaCare is at stake if voters reject
Democrats at the election.
Republicans have announced they
will repeal ObamaCare. The GOP has
already denounced ObamaCare as unworkable because of the UnitedHealth decision, but have yet to announce an alternative to
Many critics have said ObamaCare insurance markets are
unstable, unsustainable, and unworkable.
Blue Cross and Blue Shield pans have seen profits plunge by 75% , mostly
in the exchange segment of their businesses.
Over half of 23 nonprofit insurer startup have collapsed. One big reason behind these losses is the lower-than-expected enrollment of
younger healthier people, who reject the exchanges as a bad business deal and who
resent paying for the sick. Just 28% of Healthcare.gov customers were between 18 and 34, far below the 35%
needed for a balanced marketplace.
Another reason is that only 12.7 million Americans signed up during the recent enrollment period compared to the22 million projected by the
Congressional Business Office.
The Obama administration and some insurers say the market will
stabilize, but the voters may not be so sure, and they may vote their
pocketbooks. From May to November may
not be enough time for markets to stabilize. Sooner or later, I expect ObamaCare to disintegrate, to collapse under the weight its economic misunderstandings and its failure to deliver on its premises (ultimately universal coverage) and its promises (choices of doctors and health plans, lower premiums and deductibles, and greater quality and access).
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