A Tuesday Full of Obamacare Schadenfreude

Another cool, rainy day here in Southern Maryland, so I have nothing more exciting to do, after having passed my latest eye exam, than to collect Obamacare Schadenfreude from around the web. Fortunately, perhaps, there appears to be plenty.

Of course, the big news is that the enrollment data for the period up to Jan. 1, the usual deadline for continuing insurance policies is in, and as expected, the data suck, at least if you hope for a self sustaining insurance system with reasonable prices.

Amy Ridenour calls a spade a spade: Another Really Bad Obamacare Enrollment Report

Today’s enrollment report from the Dept. of Health and Human Services finally releases data on the age breakdown in the Obamacare exchanges. As many of us have expected, the exchanges aren’t even close to the number of young people the Administration claims to need to prevent an eventual death spiral.

But that’s not the really dispiriting data for Obamacare supporters. What should have them panicking is the data HHS released on subsidies. Page 11 of the report gives a breakdown. Of the 1.9 million enrollees for which there is data, about 1.65 million, or 79%, have financial assistance. That rate is probably as high as financial assistance is going to get. Despite that, enrollment of the 18-34-year-olds is, well, pitiful.

According to the Administration, about 2.7 million of the projected 7 million enrollees in the exchanges need to be 18-34-years-old—that’s about 39%. Here is the age breakdown from the report:

Only 24% of those enrolled in the exchanged are between the ages of 18-34, a far cry from 39%. Those age 45 and over—i.e., those who are likely to make the most medical claims—comprise 55% of enrollment.

The crux of the matter is if an enrollment population is comprised of only 24% 18-34-year-olds when nearly 80% of that population have subsidies, what are chances that the age mix will improve?

18-34 year olds as a group are not exactly the most responsible people in the nation, so it's likely that a lot of them will sign up late, but it's also likely that a significant fraction of them will simply blow it off as to much trouble, and too expensive and get a new cell phone instead.  The more forward looking ones may arrange it so that they don't get any money returned on their income taxes to have the Obamacare penalty tax taken out of.  I'll be shocked if they get anywhere near 39%.

Of course, in total denial, the Administration spun this as a victory:

“We’re pleased to see such a strong response and heavy demand,” said Kathleen Sebelius, the secretary of health and human services. “Among young adults, the momentum was particularly strong.”

And the problem with enrolling the "young invincibles" only understates the total problem:

The age distribution almost certainly understates the adverse-selection problem. Sick people of all ages have a far stronger incentive to buy insurance than do healthy ones--and since becoming sick no longer can result in higher premiums or make you uninsurable altogether, healthy people have even lesser incentives to buy insurance now than before ObamaCare. But no one will know what the sick-to-healthy mix is until insurers have compiled at least some months' worth of claims data.

The Administration just announced its plan to increase enrollments among the impressionable "young invincibles", a six hour social media "telethon."

Faced with the grim reality of only 24% of millenials signed up for the disastrous ObamaCare? Hey, we’ve got an idea. Let’s bore them to death via livestream! They’ll all just kill themselves instead. What does one call a six-hour ObamaCare-themed variety show? Slow torture? Cruel and unusual punishment? Desperate?

ObamaCare’s state-based marketplaces are partnering with an enrollment group in a new attempt to boost young people’s interest in the healthcare law.

The campaign from Covered California, Enroll America and other exchanges will livestream an ObamaCare-themed variety show from Los Angeles on Thursday, according to an advisory.

The six-hour show is designed to feature prominently on social media sites and contains viral content urging people to shop for ObamaCare coverage, the announcement stated.

Comedy video website Funny or Die will participate, but it is unclear whether A-List stars connected to the group will be involved. The event will air on YouTube live as well as the campaign’s website.

But the insurance companies don't care whether it succeeds or fails, because either way, they get paid!

Bailing Out Health Insurers and Helping Obamacare

Robert Laszewski—a prominent consultant to health insurance companies—recently wrote in a remarkably candid blog post that, while Obamacare is almost certain to cause insurance costs to skyrocket even higher than it already has, “insurers won’t be losing a lot of sleep over it.” How can this be? Because insurance companies won’t bear the cost of their own losses—at least not more than about a quarter of them. The other three-quarters will be borne by American taxpayers.

As Laszewski explains, Obamacare contains a “Reinsurance Program that caps big claim costs for insurers (individual plans only).” He writes that “in 2014, 80% of individual costs between $45,000 and $250,000 are paid by the government [read: by taxpayers], for example.”

In other words, insurance purchased through Obamacare’s government-run exchanges isn’t even full-fledged private insurance; rather, it’s a sort of private-public hybrid. Private insurance companies pay for costs below $45,000, then taxpayers generously pick up the tab—a tab that their president hasn’t ever bothered to tell them he has opened up on their behalf—for four-fifths of the next $200,000-plus worth of costs. In this way, and so many others, Obamacare takes a major step toward the government monopoly over American medicine (“single payer”) that liberals drool about in their sleep.

Moving us about half way to single-payer with the illusion of private markets. But, in the immortal words of Billy Mays, (or was it Vince "Offer" Shlomi?) "Wait, there's more!"

Laszewski writes that Obamacare also contains a “Risk Corridor Program that limits overall losses for insurers.” So insurers not only don’t have to pay out all of their costs; they also don’t have to swallow all of their losses.

Laszewski explains that if an insurance company expects its costs in a given year to be X, and those costs end up being more than X plus 2 percent, taxpayers will come to that insurance company’s rescue—thanks to Obamacare. In fact, once an insurance company covers that initial 2 percent in unexpected costs, taxpayers will cover at least 80 percent of any additional costs the insurer accrues.

Or as Jay Leno might have said "Spend all you want, we'll tax more."

In another interview with juiceboxer Ezra Klein, Robert Leszewski identified a (I hesitate to say "the" there are so many of them") problem with the government deciding what insurance people need:

. . . The mandated benefits are so high they’ve driven costs up and created narrower networks. . . If an entrepreneur had crafted Obamacare he would’ve gone to a middle class family. A family of four make $54,000 a year has to pay $400 in premiums net of subsidy and for that the standard silver plan has an average deductible around $2,500 and a narrow network. They’re going to pay almost $5,000 for that?

So the entrepreneur would say I’ve got $5,000 in premium and all this deductible, what do they want for that? And they probably would’ve said we want office visits and lab tests because the kids need to go in occasionally and then we want catastrophic care. The problem with Obamacare is it’s product driven and not market driven. They didn’t ask the customer what they wanted. And I think that’s the fundamental problem with Obamacare. It meets the needs of very poor people because you’re giving them health insurance for free. But it doesn’t really meet the needs of healthy people and middle-class people.

I think that's an overstatement, but true.  I suspect that the "no preconditions" mandate is at least as big a driver of the new, higher health care costs as all the little mandates for birth control etc. etc.  But the "no preconditions" mandate is very popular, because many people are affected by preconditions, and even more friends and family are known to be affected.  The question is whether health people are willing to pay double their healthcare costs to support that (assuming they figure it out).

Speaking (digitally of course) of pre-existing conditions, check out this case:  This inspirational, disabled family lost its health coverage, and it’s Obamacare’s fault

The Daverts are just one of the thousands of American families who lost healthcare coverage after Obamacare forced their insurance company to cancel their plan.

But the Daverts aren’t like any other American family. Twin children Austin and Michaela have brittle bone disease, as does their mother, Melissa. Their father, Ken, has cerebral palsy. Though their handicaps–and medical expenses–are significant, life together is not just manageable, but happy, in their Bay City, Michigan home.

Things have become much more difficult, however, since recently implemented provisions of the Affordable Care Act cause their insurer to drop the children from their health plan. And even after spending hours and hours navigating the labrynthine HealthCare.gov and demanding answers from confused call center bureaucrats, Melissa Davert’s children remain uninsured, despite their constant medical needs.

Keep that one in mind the next time someone tells you how wonderful it is that they get subsidized health care that they couldn't get before due to a pre-existing hangnail or something.

And on the lighter side, Oregon's website is still not functional:



Tune in, turn on, drop out and get covered, Oregon!