Friday, June 17, 2016

Those Unstable Health Exchanges
Nothing is so weak and unstable as a reputation for power not based on force.
Tacitus (66-120AD),Annals XIX
I  was reviewing the health care news for the day, and I ran across these two articles that  reinforced my impression that the government is not as powerful or stable as it seems when it comes ObamaCare. 
 I shall quote now quote the start of the two news pieces. .
One,  “As Premium Spikes Loom, White House To Dole Out $22M For States To Keep Insurers In Check”
Kaiser Health News, June 15, 2016
“The grants may inflame an already tense relationship with insurers, who say they've had a tough year on the ObamaCare marketplace. Meanwhile, the long-awaited Republican plan to replace the health law will lack concrete financial details, aides and lobbyists say.”
The Hill: White House Urges States To Resist ObamaCare Hike
“The White House is urging states to be more aggressive against health insurance companies as it looks to prevent expected and widespread premium hikes of 10 percent or more this year. The federal health department announced Wednesday that it will dole out about $22 million to boost state-level "rate reviews," considered one of the strongest weapons against premium increases. Under the system, health insurers are required to justify rate increases to state insurance departments, some of which have the power to reject “unreasonable” increases. With the new funding, federal health officials hope states can hire outside insurance experts to dig deeper into the proposed rates and prove the hikes are unjustified. “
From this quote,  it is clear the White House possesses  limited  power to keep premiums from soaring  and must rely in state health insurers to hold the line.    This is important because the hikes will be announced the week before the election.   Huge hikes could jeopardize Democratic chances.
Two.     Vann Newkirk II, “The Less Affordable Care Act,”  Atlantic, June 15, 2016
“ The Affordable Care Act in providing insurance coverage to the vast majority of Americans also underlines one of its core failures: That coverage remains unaffordable for many of those who don’t have employer or public insurance.”

While a record number of people—around nine in 10 Americans—now have insurance, private insurers on ObamaCare exchanges have signaled to the federal government their intent to increase premiums by double-digit percentages this fall. Some insurers active on the exchanges have gone out of business entirely, and many have lost millions of dollars. As the fall looms, some enrollees might be facing as much as 50 percent increases on premiums. Whether or not the Affordable Care Act can live up to its name is a bit of an open question.”

On the one hand, despite the ominous news from insurers, everything could still be going according to plan. Supporters of the ACA knew that it would shake up insurance markets in rather unpredictable ways. Specifically, opening up plans to direct competition via ObamaCare exchanges was likely to force some insurers out of the market; larger insurers that could afford losses would be tempted to accept them to provide artificially low costs to squeeze out competitors. Some major insurers that have left the exchange markets, such as UnitedHealth, either entered them late or did not adapt to the profile of exchange beneficiaries, which saddled them with sicker, costlier patients to cover.”

Where’s ObamaCare going,  and who can afford it?  As things stand now,  health exchange markets are unstable, insurers are edgy, many are leaving the market,  not-for-profit government-supported insurers are going bankrupt,  only about 25% of doctors are accepting exchange plans,  young people are not signing up in requisite numbers to stabilize the market,   and many people in individual markets will soon be unable to afford the affordable care act, with its  skyrocketing  premiums, deductibles,  co-pays,  and out-of-pocket costs.


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