Post Memorial Day Obamacare Schadenfreude

The ever sensible Megan McArdle on the oncoming hikes in Obamacare coverage: Sticker Shock for Some Obamacare Customers

So the proposed 2016 Obamacare rates have been filed in many states, and in many states, the numbers are eye-popping. Market leaders are requesting double-digit increases in a lot of places. Some of the biggest are really double-digit: 51 percent in New Mexico, 36 percent in Tennessee, 30 percent in Maryland, 25 percent in Oregon. The reason? They say that with a full year of claims data under their belt for the first time since Obamacare went into effect, they're finding the insurance pool was considerably older and sicker than expected.

Don't panic, says Kevin Drum. This is just the opening bid in a regulatory dance that will end up somewhere very different: "A few months from now, the real rate increases — the ones approved by state and federal authorities — will begin to trickle out. They'll mostly be in single digits, with a few in the low teens. The average for the entire country will end up being something like 4-8 percent."

He's right, of course, that the proposed rates will not end up being the final rate. Regulators are going to push back on these rates as hard as they can, with some success.

But in the case of the companies cited by the Wall Street Journal, I'd bet they're not going to go down to 4-8 percent. As it turns out, the insurer filings are public information, available on state websites. And in the three cases where I could see supporting data about premium revenue and losses, those losses appear to be large. Moda of Oregon says that its claims were 139 percent of revenue, making for a margin of -61 percent. If I am reading their somewhat confusing table right, Health Service Corporation of New Mexico says it lost $23 million on revenue of $121 million. CareFirst of Maryland says that claims were 120 percent of revenue, which if we add in some money to pay for overhead, amounts to ... less than or equal to what they're asking from regulators. I can't find claims experience data for Tennessee, but that state told the Wall Street Journal that it lost $141 million on exchange plans last year.
. . .
I assume that these large insurers are willing to incur some losses in the market for exchange policies in order to stay on the good side of their state regulators and HHS, because overall, those policies are not a large part of their business. But getting those rates down to something more on the order of 10 percent would require some pretty big losses. How long, exactly, will they be willing to carry a product that loses that kind of money?

So insurance companies are taking it in the shorts on Obamacare coverage, and will be asked forced to further subsidize it in the years to come. Insurance companies either have the choice to take more from their other insurance (e.g. employer policies) or drop out.

Dem who voted to pass Obamacare calls it ‘deceptive’ and wants to lead charge to ‘fix’ the law

The Associated Press actually managed to report that the Affordable Care Act isn’t “affordable” and doesn’t even have much “care” without calling out the Dems who voted for it who now want to lead the charge to “fix” the law (read: throw a ton more money at it).

Rep. McDermott, who voted to pass the ACA, even admits that it’s deceptive:

After paying premiums, many low- and middle-income patients still face high costs when trying to use their coverage. There’s growing concern that the value of a health insurance card is being eaten away by rising deductibles, the amount of actual medical costs that patients pay each year before coverage kicks in.
“I think it’s going to be the next big problem,” said Rep. Jim McDermott, D-Wash., a congressional leader on health care.
“We’ve got some 17 million more people covered … but they can’t access the care they seem to be entitled to,” McDermott said. “It costs too much to use the care. That’s the deceptive part about it.”
Since virtually all U.S. residents are now required to have health insurance by President Barack Obama’s health care law, McDermott said Democrats have a responsibility to make sure coverage translates to meaningful benefits.

Short version: The Obamacare law doesn’t do any of what it was ostensibly supposed to do, so now we’ll have to throw another trillion dollars at it to make the law “work.” And by all means, let’s allow those who deceived us once to spend billions more to deceive us again (those paying attention weren’t deceived the first time but were unfortunately outnumbered by morons).

The NYT doubles down on stupid: Four Words That Imperil Health Care Law Were All a Mistake, Writers Now Say in an article that utterly fails to mention contemporaneous accounts of people involved in writing the bill who said it was left that way to encourage states to make their own exchanges.

They are only four words in a 900-page law: “established by the state.”
But it is in the ambiguity of those four words in the Affordable Care Act that opponents found a path to challenge the law, all the way to the Supreme Court.

How those words became the most contentious part of President Obama’s signature domestic accomplishment has been a mystery. Who wrote them, and why? Were they really intended, as the plaintiffs in King v. Burwell claim, to make the tax subsidies in the law available only in states that established their own health insurance marketplaces, and not in the three dozen states with federal exchanges?

The answer, from interviews with more than two dozen Democrats and Republicans involved in writing the law, is that the words were a product of shifting politics and a sloppy merging of different versions. Some described the words as “inadvertent,” “inartful” or “a drafting error.” But none supported the contention of the plaintiffs, who are from Virginia.

Let me help you with that:



But, now having broken health care, democrats will next run as the party to fix it:

Democrats see skimpy insurance as the next health care issue

A different health care issue has emerged for Democrats, in sync with the party's pitch to workers and middle-class voters ahead of next year's elections.

It's not the uninsured, but rather the problem of high out-of-pocket costs for people already covered.

Democrats call it "underinsurance."

After paying premiums, many low- and middle-income patients still face high costs when trying to use their coverage. There's growing concern that the value of a health insurance card is being eaten away by rising deductibles, the amount of actual medical costs that patients pay each year before coverage kicks in.

"I think it's going to be the next big problem," said Rep. Jim McDermott, D-Wash., a congressional leader on health care.

"We've got some 17 million more people covered ... but they can't access the care they seem to be entitled to," McDermott said. "It costs too much to use the care. That's the deceptive part about it."

It was Cloward-Piven from the beginning:

The Cloward–Piven strategy is a political strategy outlined in 1966 by American sociologists and political activists Richard Cloward and Frances Fox Piven that called for overloading the U.S. public welfare system in order to precipitate a crisis that would lead to a replacement of the welfare system with a national system of "a guaranteed annual income and thus an end to poverty"