Saturday, June 18, 2016

Quite a Pile of Obamacare Schadenfreude

It's been a while and the bin is starting to look a bit daunting: 

From Texas: Obamacare Policyholders About to Get CRUSHED by Rate Increases up to 60%. Folks in flyover country hit hardest.
The Houston Chronical reported that Blue Cross and Blue Shield of New Mexico asked for a 51 percent rate increase for its exchange plans last year, and when state officials refused, the company withdrew from the state.

One insurance broker in Texas said people in rural areas of Texas will be hit the hardest by the rate increase, because Blue Cross Blue Shield is often the only option in their areas.
The Kaiser Foundation helpfully recommends, Get ready to grab your wallets, ObamaCare subscribers!
While we cannot generalize to all states until more data become available later this year, in most of these population centers, the costs for the lowest and second-lowest silver plans are, in fact, increasing faster in 2017 than they have in previous years. Based on insurer rate requests, the cost of the second-lowest silver plan in these cities will increase by a weighted average of 10% in 2017. Last year, premiums for the second-lowest silver plans in these areas increased 5% following review by state insurance departments. There is substantial variation across markets, with premium changes for second-lowest silver plans ranging from a drop of 13% to an increase of 18%. Premiums for 2017 are still preliminary and could be raised or lowered through these states’ rate review processes.
ObamaCare’s defenders rationalized price increases in the first year or two as an expected adjustment to new utilization rates. We’re on Year Four now, and the problem continues to get worse rather than better. At what point do we finally acknowledge that government-run and mandated health insurance markets are a flat-out terrible idea?
Obamacare enrollees without subsidies face big premium increases
Obamacare rates are going up sharply this year. While most enrollees are sheltered from the increases by government subsidies, there are some—those making over $47,000 a year—who face paying the full cost of the mandated coverage. The Associated Press highlights what that looks like as rates are set to go up as much as 60 percent in some areas:
“I don’t know if I could swallow another 30 or 40 percent without severely cutting into other things I’m trying to do, like retirement savings or reducing debt,” said Bob Byrnes, of Blaine, Minnesota, a Twin Cities suburb. His monthly premium of $524 is already about 50 percent more than he was paying in 2015, and he has a higher deductible…
Some unsubsidized Obamacare enrollees now have monthly premiums that are larger than their mortgage payments. That certainly was not part of the president’s sales pitch. The AP notes, “the Obama administration used public anger about premium increases as leverage to win passage of the health law.” In fact, the president predicted the law would save people money. He also repeatedly pointed to slower-than-average annual increases in premiums despite the fact that experts said most of that reduction was a delayed result of the economic recession.
Will the Obamacare marketplace stabilize and if so will anyone be able to afford it? Probably not. Louisiana insurer: As designed and administered, Obamacare ‘simply does not work’ The system was designed to fail as a stalking horse for single payer (i.e. socialized) healthcare. And that part seems to be working as planned.

But Republicans seem content to continue to apply bandages to the sucking chest wound. Alaska’s GOP creates fund to prevent collapse of Obamacare exchange
Alaska has already lost several of the insurers on its Obamacare exchange. Next year it will be down to just one remaining company selling policies. That company, Blue Cross Blue Shield, will need to raise premiums substantially in order to cover costs. Faced with the possible collapse of the state’s exchange, which currently insures 23,000 people, the state’s Republican governor recommended passing a law to use state funds to keep prices down. Politico reports on the surprising turn of events:
. . .
Alaskans already faced high costs but their Obamacare prices are the highest in the nation:
An analysis of average 2016 Obamacare premiums from Avalere Health, a consulting firm, showed that the lowest-cost “silver” level plan in Alaska cost $956 per month before any subsidies were factored in — the highest rate in the nation. That amount is 40 percent higher than the year before.
Alaskan Republicans face an unenviable choice. They can either put the program they didn’t want in the first place on state life support or they can let the market take its course, which will create more disruption for tens of thousands of Alaskans. Republican state Rep. Lance Pruitt tells Politico, “Are we trying to maintain ACA? I think what we’re trying to do is live within the new reality that’s out there.” In other words, they don’t really have much of a choice since the federal law mandates this.
House GOP considering smaller changes to Obamacare
After years of pushing for full repeal of Obamacare, House Republicans are considering several smaller changes to the law. The Hill reports:
The measures are favorable to health insurers and could help shore up their bottom lines amid heavy financial losses for many on the ObamaCare marketplaces so far.
One bill would allow insurers to charge older people higher premiums to account for the higher cost of their care. The bill would allow older people’s premiums to be five times higher than younger enrollees’, rather than three times higher, as it is under ObamaCare currently.
Another measure would require people signing up for ObamaCare in extra sign-up periods to provide documentation proving that they qualify before enrolling, rather than after.
A third bill would reduce the grace period for enrollees who don’t pay their premiums to 30 days, from 90 days, before they lose their coverage.
All of these are changes which insurers, including those who are sticking with the Obamacare exchanges rather than dropping out, have recommended.
After one more "fatality" in Ohio Thirteen of 23 Co-Ops Created Under Obamacare Have Failed. That's more than half:
The Ohio Department of Insurance asked to liquidate the company, saying that the company was in a “hazardous financial condition.” The co-op served nearly 22,000 consumers who now have 60 days to find another policy offered by another company on the federal exchange.

“Our examination of the company’s financials made it clear that the company’s losses would prevent it from paying future claims should its operations continue,” said Ohio Director of Insurance Lt. Gov. Mary Taylor. “Under Ohio law, we acted with certainty to protect the consumers.”
Your ObamaCare Fail of the Day
I dunno -- today's ObamaCare fail might just prove to be a great big win. Read:
A nonprofit health insurer in Maryland is suing the federal government to avoid more than $22 million in fees under an ObamaCare program that the group calls “dangerously flawed.”
The first-of-its-kind lawsuit targets the Obama administration’s strategy for protecting health insurers from losses in the new marketplace.
In a lawsuit filed Monday, Evergreen Health Cooperative Inc. warned the program could “threaten the viability of the entire Affordable Care Act" if it is not fundamentally altered.
Evergreen Health, a nonprofit co-op, said it has been unfairly asked to pay millions of dollars — about one-quarter of its 2014 premiums revenue – under the law’s “risk adjustment” program.
Under the program, states collect money from better-performing insurers, like Evergreen, to pay companies that have racked up higher-than-expected medical costs.
But Peter Beilenson, Evergreen's CEO, argued the program uses an unfair formula that “tilts the field” in favor of larger, more-established companies over newer startups like the co-op programs.
Guess who really wrote the bill, insurance company lobbyists, or executives of small co-ops that didn't exist yet?

Which of these three doesn't belong in this sentence? A must read from the usually sensible Megan McArdle: Obamacare, Executive Power and the Rule of Law.
A few weeks back, I noted that a judge had ruled against the Obama administration in a dispute over health-insurance subsidies. Some background: Obamacare makes insurers reduce out of pocket costs, like deductibles, to low-income people who purchase qualifying plans; the government is supposed to reimburse the companies directly. However, Congress didn’t appropriate any money to pay for these subsidies. When the administration went ahead and paid the insurers anyway -- distributing about $7 billion without congressional approval -- House lawmakers sued.

Now it appears that House Republicans, and Judge Rosemary Collyer, aren’t the only folks who thought the administration’s actions were questionable. A report in the New York Times this weekend says that IRS officials raised concerns that the administration had no legal authority to spend the money. Starting in 2013, former IRS financial risk officer David Fisher and his supervisor “began having qualms about how the White House was planning to proceed,” according to the Times account. “In combing through documents to make sure his agency could defend the spending in future audits, Mr. Fisher said he came up empty.”

No one has really come up with a stronger defense of the administration's tactics. The better critics of the House lawsuit rest their complaints about standing -- whether the House has the authority to sue the administration over such matters -- and not on an argument that the administration was actually within the law. . . 
Of course it does: California Moves To Extend Health Insurance To Undocumented Immigrants
California Governor Jerry Brown signed a bill into law allowing unauthorized immigrants to buy health insurance on a state exchange created under the U.S. Affordable Care Act, making the state the first in the country to offer that kind of coverage.

The law lets the state request a waiver from the federal government that will be needed to allow unauthorized immigrants to purchase unsubsidized insurance through Covered California, the state’s healthcare exchange.
. . .
The Los Angeles Times reported that if the waiver is approved, it would allow as many as 390,000 immigrants to purchase healthcare insurance through the state’s exchange.
Opponents of the legislation have said it would unnecessarily cost California taxpayers and strain the state’s healthcare system.

About 7 percent of California’s population, or 2.6 million people, lack legal immigration status. In 2012, the state spent more than $600 million on emergency room and other health-related services for people living in the state illegally.
My guess is that without subsidies, the Obamacare market will not be very appealing to most illegal aliens, which will lead to further calls for giving them the subsidies.

Wait! I thought that Obamacare would not allow illegal aliens? What happened? 
Obamacare explicitly bars people in the country illegally from its provisions, but a loophole called the “innovation waiver” allows for states to change portions of the law, as long as they make coverage available to more people and as long as the federal government doesn’t have to pick up the tab, among other requirements. The bill, which would require that a request for a waiver be filed, first must be approved by the state legislature and the governor before the waiver can be considered by the federal government.

Though the California bill does not come with federal subsidies that make health insurance more affordable to low- and middle-income people, critics fear it’s heading that way.
Joe Wilson wasn’t wrong. He was prescient.

But Obamacare serves another valuable function, filling Democratic coffers: DNC platform chair raises cash from health insurers, appoints fmr Cigna lobbyist as regulator of Cigna merger

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