ObamaCare proving to be unsustainable for insurers or insured

Tim Hartman cartoon

This is not exactly the best business model one could create — the businesses can’t sell the product at a profit and the customer can’t afford to buy it.

But when the facts hit your eyes like a big pizza pie, that’s ObamaCare.

The Wall Street Journal reports that UnitedHealth Group’s $425 million downgrade in forecasted earnings for 2015 was almost entirely due to losses on the ObamaCare exchanges. As a result the company is threatening to stop selling on the exchanges in 2017. It has already suspended advertising the product and stopped paying commissions for new policies. “It literally doesn’t want consumers to buy its products,” WSJ observed.

The company said the payouts for ObamaCare coverage are exceeding premium income and there is no turnaround in sight. This doubtlessly happening with other insurers as well.

Meanwhile, The New York Times is reporting that many people are deciding to forego health insurance because of the high deductibles under ObamaCare. In order to keep premiums low, insurers are charging outlandish deductibles before coverage kicks in.

The Times found one family of four that paid premiums of $1,200 a month with an annual deductible of $12,700. That means they would have to pay out of pocket $27,100 before seeing a dime of coverage.

The newspaper said people are dropping coverage and risking paying the penalty under ObamaCare. It is cheaper.

Aren’t there truth in labeling laws? Affordable Care Act indeed.

Forbes points out how few are really signing up for ObamaCare.

While the Congressional Budget Office had projected that 14 million enroll this year, it looks like the number will be about 9.5 million. Of those, only 2 million will be getting refundable tax credit subsidies. “That means that Obamacare is quickly turning into a Medicaid expansion,” the article explains. The single payer is the taxpayer.

Meanwhile, the co-ops set up under ObamaCare with taxpayer loans to provide competition and keep prices lower are going broke, including Nevada’s.

David Catron at The American Thinker offered this summation: “If you increase the cost of doing business for insurers, they’ll raise premiums and deductibles. If you make it impossible for them to make a profit selling coverage through exchanges, they’ll pull out. If you make coverage too expensive, people won’t buy it. If that coverage pays doctors less than it costs to treat a patient, doctors won’t treat them. If you pass a law that ignores such realities, it will be subjected to fact after brutal fact until it finally dies.”

The UnitedHealth Group is threatening to drop ObamaCare coverage. (AP photo)

 

 

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22 comments on “ObamaCare proving to be unsustainable for insurers or insured

  1. nyp says:

    One of these days ObamaCare will finally collapse –just you wait! Just you wait!

  2. Actually…one of these days it WILL be repealed…and replaced. That day can’t come soon enough!

  3. nyp says:

    Where is my death panel?
    I was promised death panels.
    Where are they?

  4. Life saving drugs excluded from coverage.

    “What we have is an under-insurance problem,” he said. “People are now under-insured, especially for catastrophic drugs if they get a disease like cancer or something like that because of these new [narrow] formulary designs … popularized by the Affordable Care Act.”

    http://www.cnbc.com/2015/11/24/obamacare-to-blame-for-soaring-drug-costs-aei.html

  5. Steve says:

    When they said people would be “steered” to Medicaid, they weren’t joking…no other option at all. Stops you dead in your tracks if you “might” qualify for Medicaid.

    Since I am still looking for gainful employment, this is what happened to us.

    Medicaid, waiting for the state to contact us now.

  6. Steve says:

    Today’s fun fact.
    New York:
    “The sudden collapse of the largest nonprofit insurance cooperative created by President Barack Obama’s health care law is causing headaches in New York, especially for medical providers owed millions of dollars for treating the failed plan’s patients.

    More than 200,000 people insured through Health Republic Insurance of New York have until Monday to sign up with another company if they want to maintain coverage in December.”

    Huh, Nevada Health Coop stayed active through the end of the year. With only one month left, wonder how how those guys get away with simply throwing all those people off the cliff…..

  7. nyp says:

    The people “thrown off a cliff” sign up for another insurance plan in their state marketplace.

    the drug formulary story is idiotic. Which “life-saving” drugs are not covered by insurance plans sold in the marketplace?

  8. The powers of the Independent Payment Advisory Board are only triggered when Medicare’s rate of spending growth is projected to rise faster than a peg that’s tied to inflation. Medicare’s projections show that this threshold will be triggered in 2017, and maybe sooner.

  9. Steve says:

    Touchy, nypatrick, touchy.

    They shouldn’t have to do that, put’m all on Medicaid for a month!

  10. Steve says:

    And….

    stiffing providers is a GREAT way to get providers to accept ACA insurance plans!

  11. Anonymous says:

    Nice little string of fun facts Thomas. Let’s see….Nope, not a single one quantifying the change in our total health care bill since Obamacare began. I wonder why? Nevertheless, I would quickly agree that Obamacare does little to solve our problem with outrageous health care costs. That’s because it failed to address the two major causes: 1) An out of control tort system and 2) A health care industry that functions as a cartel. But some of what I read here smells like the cherry picking of factoids to make things seem worse than they are.

    “…the company is threatening to stop selling on the exchanges in 2017. Great. Then we can socialize it as every other advanced country in the world has done with better results and lower costs than ours.

    “… many people are deciding to forego health insurance.” That certainly didn’t bother you when it occurred under the old system. Why the change of heart?

    “The Times found one family of four that paid premiums of $1,200 a month with an annual deductible of $12,700. That means they would have to pay out of pocket $27,100 before seeing a dime of coverage.” I’ve never seen a $12,700 deductible, and how does that translate into $27,100? Oh wait. You’ve assumed that every family member had a catastrophic illness in the same year. Even if we accept that unlikely event, it’s still a stretch, judging my payments for an aged family of two in one of the highest cost areas in one of the least competitive states ($843/month with a maximum $13,700 out of pocket for both of us. Care to share the date and page of the Times article? Something smells fishy.

    “While the Congressional Budget Office had projected that 14 million enroll this year, it looks like the number will be about 9.5 million…” Why compare it to some guesstimate projection? Wouldn’t it make more sense to compare the number of people insured today vs before Obamacare began? Oh, now I understand. That would be too fair and ruin your case!

    “If you increase the cost of doing business for insurers, they’ll raise premiums and deductibles…” Blah, blah, blah. The problem is the $14.00 aspirin tablet and the twenty dollar antibiotic selling for $1600. No matter what the insurance industry or Obamacare does, they can’t fix a thing without getting at the root of the root of the problem: Good old fashioned price gouging.

  12. Seagull says:

    It doesn’t take a catastrophic illness. It takes something as simple as a fall requiring surgery, perhaps more than one, several weeks in the hospital, then a couple months of physical therapy. Medical procedures are shockingly expensive and costs have only gone up since the advent of Obama care. We can argue about such issues as price gouging, but people have to deal with insurance costs as they are. Obama care has been a disaster for American consumers. That is simply the truth.

  13. nyp says:

    yeah, life was so much better before millions of people gained insurance coverage in 2014.

  14. Insurance coverage they can’t afford to use.

  15. Steve says:

    Insurance coverage primary care doctors won’t accept.

  16. nyp says:

    BTW, you are aware that since the passage of the Affordable Care Act health care costs have risen at the slowest rate in 50 years — right?

  17. Steve says:

    BTW, you are aware that since the passage of the Affordable Care Act the world has been in a recession, accounting for lower costs of everything! (even the lowering cost curve of healthcare)
    But not health insurance costs! THOSE went UP!

  18. Anonymous says:

    1. The US has not been in a recession – it has been in a moderate recovery mode since 2010
    2. Over the past half-century health-care costs rose during domestic recessions.

  19. Steve says:

    “moderate recovery”
    translation- the worst “recovery” since the 1930’s. Still explains the “lowering of the cost curve”

    and (2) those costs have been rising during this one too.

    And (you didn’t try this one) health insurance premiums have gone UP!

  20. nyp says:

    First, the recovery is from the worst economic collapse since the Great Depression. That’s why it was known as the Great Recession. Second, as I noted, in past decades health care cost inflation rose through all sorts of recessions and recoveries. This time the cost curve has shifted quite dramatically downwards. And it hasn’t recovered from the downward shift even as the economy reached its present level of relative strength. Third, you are wrong in claiming that this is the “worst” economic recovery since the 1930s. http://econbrowser.com/archives/2014/12/how-come-i-dont-still-hear-about-the-worst-recovery-ever
    Finally, the growth in famiy insurance premiums is slower than it was before the Affordable Care Act. http://www.factcheck.org/2015/02/slower-premium-growth-under-obama/

  21. Steve says:

    It was known as the great “recession” because there was a political decision to stop calling economic downturns depressions after the one in the 1930’s. It was thought better to call them something else, especially when the one in 38 came along. Recession was chosen because it sounded better.

    “The cost curve shifted downward” because of the weak economy. And the diligence on ACA remains to be seen even as parts of it STILL remain to be implemented. (employer mandate) and others may well be removed completely. (Cadillac tax)

    You find cherry’s while meat is allover the table on the nature of the “recovery”
    Even Huff doesn’t support your crap.

    “Finally, the growth in famiy insurance premiums is slower”

    About time you acknowledge premiums are UP.

  22. Anonymous says:

    Recessions and depressions are technical terms defined by the National Bureaubof Economic Research. They aren’t subjective. By any statistical measure the economic crisis of 2008-10 was the worst since the Great Depression.
    And I have never said that insurance premia were falling, but only that the rate of increase was slower than before the ACA

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