Post by Dixie on Oct 14, 2015 6:43:32 GMT -6
ObamaCare exchanges collapsing, enrollment plummeting
Dan Calabrese | Wednesday October 14th, 2015
Four exchanges insolvent, 11 receive warning letters . . . and nearly 2 million enrollees aren't paying their subsidized premiums.
Gosh, who saw this coming? The federal government sets up an artificial market for selling health insurance, sets the prices, subsidizes the premiums, goads people to buy who've never before been able to afford it, forbids profits and bans anyone who actually knows what they're doing from running the darn things.
How could that possibly fail?
Quite spectacularly as it turns out. While the mainstream media ignores all of the following, lest it stumble in its role as Democrat campaign propagandists, the Wall Street Journal editorial page is doing its usual excellent job of telling us what's really happening with ObamaCare. And in short, the economic model is failing. The state exchanges are turning out to be complete disasters, and of the 11.7 million people who signed up for health insurance with subsidized premiums, nearly 2 million of them still can't pay their premiums.
This is a mess:
There's so much wrong with ObamaCare, I won't even begin to claim I'm covering it all. But I do want to point out one of the most important flaws in the overall concept: Democrats thought it would be a huge win to get as many people as possible "covered" and to have the policies under which they were covered pay for as many basic things as possible. And they were sure that if the number of enrollees rose, they could control the cost of the premiums.
Why isn't it working? Because the entire premise behind that thought is flawed. What makes health care so expensive is the fact that everyone relies on third parties to pay for even the most rudimentary things like basic doctor's office visits that folks can and should pay for out of pocket. Liberals will tell you government has to pay for this stuff because no one will go for "preventive" visits unless it's free to them. But actual behavior doesn't bear that out. Non-emergency uses of ERs on the rise - exactly the opposite of what ObamaCare's champions said would happen. And overall health care costs are soaring as a signficant chunk of those signing up through ObamaCare are really signing up through expanded Medicaid, which limits doctor reimbursements while exploding demand on the system.
Meanwhile, there's a reason so many of these people can't afford the premiums. Subsidies or not, their income isn't stable enough to handle the monthly obligation, which is why it makes no sense to try to get them "covered" under all-inclusive health insurance policies that demand a monthly premium from them in order to make things "free" that most people could just pay for themselves.
The Journal points out that Democrats figured all along the federal government could just bail out the exchanges if this happened, but now that we've got Republican control of Congress, they're not able to get nearly enough money allocated to do that. I'm actually shocked that Obama doesn't hold out for everything he wants and accuse the Republicans of trying to "shut down the government" if they don't give it to him - followed promptly by a Republican cave.
Come to think of it, maybe I shouldn't have raised the idea.
But none of this changes the fact that the ObamaCare economic model was never feasible, and now we're seeing the inevitable result of that. The fact that the mainstream media won't tell you this is the most damning thing of all here. At least Democrats will tell you their mission in life is to redistribute wealth and give you free stuff. The media claims to be in the business of informing the public. They're the biggest liars of all.
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Dan Calabrese | Wednesday October 14th, 2015
Four exchanges insolvent, 11 receive warning letters . . . and nearly 2 million enrollees aren't paying their subsidized premiums.
Gosh, who saw this coming? The federal government sets up an artificial market for selling health insurance, sets the prices, subsidizes the premiums, goads people to buy who've never before been able to afford it, forbids profits and bans anyone who actually knows what they're doing from running the darn things.
How could that possibly fail?
Quite spectacularly as it turns out. While the mainstream media ignores all of the following, lest it stumble in its role as Democrat campaign propagandists, the Wall Street Journal editorial page is doing its usual excellent job of telling us what's really happening with ObamaCare. And in short, the economic model is failing. The state exchanges are turning out to be complete disasters, and of the 11.7 million people who signed up for health insurance with subsidized premiums, nearly 2 million of them still can't pay their premiums.
This is a mess:
Some churn is inevitable, but the Congressional Budget Office estimated two years ago that some 13 million would participate in 2015, and its most recent revision in March of this year still pegged the figure at 11 million. The CBO nonetheless now projects ObamaCare will more than double in size in 2016 to 21 million, and such a growth spurt is probably necessary to stabilize the insurance markets.
But don’t count on the attrition problem going away given ObamaCare’s high and rising costs, as well as its low quality that is approaching Medicaid levels of coverage. The plans simply don’t offer good value for the money.
In a new working paper, Wharton economists Mark Pauly, Adam Levine and Scott Harrington estimate how much better or worse off the non-poor uninsured are under ObamaCare. They measure the cost of the plans, the benefits of consuming pre-paid medical care and out-of-pocket payments without obtaining coverage. They conclude that, “even under the most optimistic assumptions,” half of the formerly uninsured take on both a higher financial burden and lower welfare, and on net “average welfare for the uninsured population would be estimated to decline after the ACA if all members of that population obtained coverage.”
In other words, ObamaCare harms the people it is supposed to help. This is not a prescription for a healthy, durable program.
Markets have also been disrupted by a cascade of failures among the ObamaCare co-ops that were intended as a liberal insurance utopia. These plans were seeded with billions of dollars in federal start-up loans and were supposed to work like the credit unions or the electric collectives of the Depression era. No profits were allowed, advertising to introduce new products was restricted and industry executives were barred from management. As it turns out, attempting to outlaw expertise and incentives tends not to produce good results.
But don’t count on the attrition problem going away given ObamaCare’s high and rising costs, as well as its low quality that is approaching Medicaid levels of coverage. The plans simply don’t offer good value for the money.
In a new working paper, Wharton economists Mark Pauly, Adam Levine and Scott Harrington estimate how much better or worse off the non-poor uninsured are under ObamaCare. They measure the cost of the plans, the benefits of consuming pre-paid medical care and out-of-pocket payments without obtaining coverage. They conclude that, “even under the most optimistic assumptions,” half of the formerly uninsured take on both a higher financial burden and lower welfare, and on net “average welfare for the uninsured population would be estimated to decline after the ACA if all members of that population obtained coverage.”
In other words, ObamaCare harms the people it is supposed to help. This is not a prescription for a healthy, durable program.
Markets have also been disrupted by a cascade of failures among the ObamaCare co-ops that were intended as a liberal insurance utopia. These plans were seeded with billions of dollars in federal start-up loans and were supposed to work like the credit unions or the electric collectives of the Depression era. No profits were allowed, advertising to introduce new products was restricted and industry executives were barred from management. As it turns out, attempting to outlaw expertise and incentives tends not to produce good results.
There's so much wrong with ObamaCare, I won't even begin to claim I'm covering it all. But I do want to point out one of the most important flaws in the overall concept: Democrats thought it would be a huge win to get as many people as possible "covered" and to have the policies under which they were covered pay for as many basic things as possible. And they were sure that if the number of enrollees rose, they could control the cost of the premiums.
Why isn't it working? Because the entire premise behind that thought is flawed. What makes health care so expensive is the fact that everyone relies on third parties to pay for even the most rudimentary things like basic doctor's office visits that folks can and should pay for out of pocket. Liberals will tell you government has to pay for this stuff because no one will go for "preventive" visits unless it's free to them. But actual behavior doesn't bear that out. Non-emergency uses of ERs on the rise - exactly the opposite of what ObamaCare's champions said would happen. And overall health care costs are soaring as a signficant chunk of those signing up through ObamaCare are really signing up through expanded Medicaid, which limits doctor reimbursements while exploding demand on the system.
Meanwhile, there's a reason so many of these people can't afford the premiums. Subsidies or not, their income isn't stable enough to handle the monthly obligation, which is why it makes no sense to try to get them "covered" under all-inclusive health insurance policies that demand a monthly premium from them in order to make things "free" that most people could just pay for themselves.
The Journal points out that Democrats figured all along the federal government could just bail out the exchanges if this happened, but now that we've got Republican control of Congress, they're not able to get nearly enough money allocated to do that. I'm actually shocked that Obama doesn't hold out for everything he wants and accuse the Republicans of trying to "shut down the government" if they don't give it to him - followed promptly by a Republican cave.
Come to think of it, maybe I shouldn't have raised the idea.
But none of this changes the fact that the ObamaCare economic model was never feasible, and now we're seeing the inevitable result of that. The fact that the mainstream media won't tell you this is the most damning thing of all here. At least Democrats will tell you their mission in life is to redistribute wealth and give you free stuff. The media claims to be in the business of informing the public. They're the biggest liars of all.
Source Link