Tag: "ObamaCare"

Obamacare Slightly Increased Short-Term Uninsured

NHISThe best measurement of people who lack health insurance, the National Health Interview Survey published by the Centers for Disease Control and Prevention (CDC), has released early estimates of health insurance for all fifty states and the District of Columbia in 2015. There are two things to note.

Obamacare 2016 Average Rate Hike 8 Percent

HealthcaredotgovWe are already anticipating double-digit premium hikes for Obamacare plans in 2017, based on insurance filings in a sufficient number of states to show the trend.

Obamacare’s defenders point out two limits to these leading indicators. First, they are requested, not approved rate hikes. Second, Obamacare beneficiaries can trade down. A person whose plan hikes premiums double digits can switch to a plan with a lesser increase. Both criticisms are fair.

Nevertheless, now that the dust has settled on 2016, and all the data on this year’s enrollment analyzed, we can confirm from two pro-Obamacare sources that premiums in Obamacare’s exchange plans increased by an average of eight percent from 2015 to 2016. General measures of price changes, such as Consumer Price Inflation, were effectively flat over the period. That is, the eight percent Obamacare premium hike was a real, not nominal, price hike.

Obamacare Exchange Average Premium Hike 16 Percent Next Year

CAM00109Caroline F. Pearson of the Avalere consulting firm has surveyed states which have already published 2017 Obamacare exchange premiums. Among eight states and the District of Columbia, the average requested rate hike is 16 percent for popular Silver plans:

Specifically, average proposed rate increases across all silver plans in the nine states examined range from 44 percent in Vermont to 5 percent in Washington. In 2016, 68 percent of exchange enrollees selected silver plans.

According to the data, in most states, proposed premiums for lower cost silver plans increased less dramatically or even went down for 2017, compared to higher-cost plans on the same tier. Lower-cost silver plans tend to be most popular with consumers, making this portion of the market more competitive as plans seek to attract enrollees.

The devil is in the details: The lowest premium Silver plan is going up seven percent, and the second lowest 8 percent, which means most Silver plans are going up more than 16 percent.

Do We Have to Work for Nuns To Dodge Obamacare’s Mandates?

r-NUNS-BIRTH-CONTROL-large570Obamacare’s opponents are cheering the Little Sisters of the Poor’s apparent victory over Obamacare’s mandate to cover artificial contraception, about which I wrote when the controversy first erupted.

The Little Sisters defied the mandate, which is contrary to their Catholic faith. The mandate is (obviously) not relevant to the nuns themselves, but to their lay employees who work in the Little Sisters’ nursing home and are covered by their plan.

The Supreme Court decision is not complete victory: SCOTUS vacated judgments and fines approved by lower courts and sent the case back to lower courts to give the Administration time to find another way to get contraceptive coverage to the Little Sisters’ lay employees.

Bravo to the nuns for standing up to Uncle Sam. However, I am increasingly concerned that advocates of small government have surrendered a lot of ground in the fight for individual liberty. Unless a person or persons have a sincerely held religious objection to a federal mandate, they have to obey. This principle is problematic.

Pittsburgh Insurer Highmark Swings for the Fences on Obamacare Bailout

1(A version of this Health Alert was published by Forbes.)

Health insurers have not had much to cheer about lately, when it comes to Obamacare. They have been losing money on exchanges, and there is little hope that will change. So, a large health plan in Pittsburgh has asked judges to give it Obamacare money the Administration promised, but Congress declined to appropriate.

As reported by Wes Venteicher and Brian Bowling of the Pittsburgh Tribune-Review, Highmark lost $260 million on Obamacare exchanges in 2014, and claims it is owed $223 million by taxpayers. Unfortunately, it received only about $27 million. And things are getting worse. To date, Highmark has lost $773 million on Obamacare exchanges.

It is not that Highmark has been singled out by anybody. On the contrary, the Administration announced last year it was only going to pay about 13 cents on the dollar for all insurers’ exchange losses, via Obamacare’s “risk corridors.” This was not the Administration’s preferred course of action. The Administration wanted to pay insurers one hundred cents on the dollar, which it had promised them.

Federal Health Bureaucracy Growing? Don’t Blame (Just) Obamacare

Libertarians and conservatives and others have spent five years complaining about the increased bureaucratic burden of Obamacare. New research by Sam Batkins of the American Action Forum, while not letting Obamacare off the hook, shows the problem predates the current Administration. The following chart shows the burden of paperwork has increased linearly since at least 2005:

20160509 Batkins AAF

Taxpayers Increasingly Victimized in Obamacare Exchanges

-18(A version of this Health Alert was published by The Hill.)

Recent news has renewed attention on Obamacare’s health insurance exchanges (misleadingly called “marketplaces” by the Administration).

America’s largest health insurer, UnitedHealth Group, will all but withdraw from the Obamacare exchange business. Having sold plans in 34 states this year, the company will participate in only a “handful” next year. With 795,000 beneficiaries, UnitedHealth Group indicates it will lose $650 million in the exchanges this year – over $800 per enrollee.

Other insurers are sticking it out. Notably, Anthem, another leading for-profit insurer, which has nearly one million Obamacare enrollees, is positive about its future in the exchanges. In its latest quarterly earnings call, Anthem anticipated a profit of three to five percent. However, that is not likely to happen until 2017. Further, the insurer said it needs the federal government to take unspecified actions to “stabilize” the market. Anthem’s optimism is surprising.

Health Insurers Shift More Costs To Taxpayers In Obamacare Exchanges

money-burden(A version of this Health Alert was published by Forbes.)

America’s health insurers are undergoing a crisis of consensus with respect to their engagement with Obamacare. Between 2010 (when the Affordable Care Act was signed), and 2014 (the first year of taxpayer-subsidized coverage in the health insurance exchanges), it was widely understood that health insurers had scored a big win. After all, which other industry could get the federal government to pass a law mandating individuals purchase its product or service as a condition of residency in the United States?

This view was reflected in the stock market’s valuation of health insurers, which outperformed the S&P 500 Index. Since then, of course, we have learned that insurers have been losing money on Obamacare’s exchanges. Further, they have lost the sympathetic ear of the Congressional Republican majority, which has prevented insurers extracting as much taxpayer funding as they had expected from the Treasury. We should not expect insurers which continue to participate in exchanges to just keep losing money. In fact, the evidence indicates some insurers have quickly learned how to shift more costs onto taxpayers, despite failing to win an explicit political commitment to do so.

Administration Still Bailing Insurers Out of Obamacare Exchanges

money-rollsThe Obama Administration refuses to concede defeat in its struggle to save Obamacare’s exchanges. The exchanges lost one quarter of their members in 2015. The Blue Cross Blue Shield Association has reported its insurance plans have enrolled people significantly sicker (and more expensive) than anticipated. Finally, UnitedHealth Group, the nation’s largest insurer, will drop out of most of the exchanges in which it is participating.

Desperate to induce insurers to continue participating in exchanges, the Administration suggested it would make illegal payments from “risk corridors,” a risk-mitigation mechanism that moves money between insurers to stabilize their profits in Obamacare’s first three years. Republicans in Congress put a stop to that in 2014. So, the Administration proposes apparently illegal payments from another risk-mitigation fund, called “reinsurance.”

Obamacare’s Unintended Consequences: People Buy Short-Term Policies

woman-with-childObamacare has driven individual health insurance premiums up so high people are forgoing comprehensive coverage in favor of short-term policies:

Robin Herman, the 34-year-old owner of a marketing firm in San Francisco, bought a short-term policy in December. The monthly cost of her short-term coverage, plus conventional ACA-compliant plans for her two children, is roughly one-quarter of what she would have paid for conventional health plans covering all three of them, she says.

“This is saving me a ton of money for the year,” she said, despite the penalty. Plans that comply with the health law’s rules cost more than her old pre-ACA policy and are “just not affordable,” she said.

(Anna Wilde Mathews,” Sales of Short-Term Health Policies Surge,” Wall Street Journal, April 10, 2016.)

Sales of these policies have doubled or more since 2014, according to sources cited by Ms. Mathews. This surely feeds into the problem that Obamacare enrollees are sicker than expected: The healthy candidates are choosing these policies.