Humana, one of the country’s top insurers, announced Thursday that it’s pulling out of ObamaCare exchange plans in all but a few states next year.
By Post Editorial Board July 24, 2016 | 9:23pm
Count it as another nail in ObamaCare’s coffin.
Humana will offer policies in “no more” than 11 state marketplaces, down from 19. The numbers don’t add up: Humana took nearly $1 billion in losses from the coverage this year.
This follows the exit from the exchanges of such other giants as Cigna and UnitedHealth Group, also after outsized losses.
It’s the much-feared “death spiral”: Too many older, sicker folks are resorting to ObamaCare policies, and not enough younger, healthy folks. So the average enrollee is running up higher bills than the insurers expected — and raising rates will only scare away even more lower-cost customers.
Meanwhile, the Obama Justice Department is moving to block health-insurer mergers — including an Anthem-Cigna deal as well as Aetna’s bid to buy Humana. Why? As The Post’s Josh Kosman reports, the “move would be a blow to the president’s state-focused ObamaCare.”
The White House fears the mergers would give the combined firms too much power to set rates, limiting consumer options.
Funny: The ObamaCare law encourages lots of other anti-competition mergers, of hospitals and other providers, in the name of “efficiency.” And doctors across America are giving up on traditional independent practices — as the law pushes them to do.
And countless people stuck buying policies on the exchanges have been shocked at how limited their options — like choice of doctor and hospital — turn out to be.
President Obama and Hillary Clinton both used to pooh-pooh the idea of a “public option”: Government-run health insurance that’s just a step away from European-style socialized medicine. But ObamaCare’s woes have pushed both to start suggesting it may be the only answer after all.
The only answer, that is, besides replacing ObamaCare with a truly market-based system that still helps the less fortunate, but doesn’t try to dictate everything from Washington.
If that sounds better to you, don’t vote for any Democrats this November.
After accruing $1 billion in losses, Humana, one of the largest health care providers in the country, has made the decision to eventually leave the vast majority of the Obamacare markets (via The Hill):
Humana, one of the nation’s top health insurers, is pulling out of ObamaCare plans in all but a handful of states after a year of nearly $1 billion in losses.The company plans to exit nearly half of its Obamacare markets next year, the company announced during an earnings report Thursday. It will take part in “no more” than 11 state marketplaces, down from 19 states this year, the company said.
Humana’s decision to exit “substantially all” of the state exchanges comes the same day that the Obama administration announced it would step in to block a multi-billion dollar merger between Humana and Aetna. Both are among the so-called “big five” of the nation’s major health insurers.
Guy has written extensively about the shaky financial foundations health care providers have found themselves in under the new health care. Since the beginning of the year, the stories about massive losses and possible withdrawals from the Obamacare markets, UnitedHealth said they’d be removing themselves from most of the markets by 2017. Blue Cross and Blue Shield is another.
Usually it’s a good thing that everything’s bigger in Texas, but that isn’t true when it comes to health insurance premiums for Obamacare. Recent federal data shows that Texas’ largest insurer on the Obamacare Marketplace exchanges is seeking average premium increases of nearly 60 percent for 2017 — among the highest hikes in the entire country.
At least 600,000 policyholders with Blue Cross Blue Shield may quickly find their insurance coverage is unaffordable. Some may already feel that way: Texans with individual exchange policies through Obamacare this year already saw premiums rise by about 14 percent.
State regulators still must approve the latest request — many major Texan insurers are requesting double-digit premium hikes — but it is all but certain that Texans will feel more financial pain in 2017.
This alone shows that the Affordable Care Act continues to harm the very people it was supposed to help. And premiums are increasing even though health insurers receive billions of dollars distributed by the federal government to try to keep premium hikes low.
These handouts have received little attention until now. Obamacare was essentially designed as one big special-interest giveaway to health insurers, which is why they lobbied so heavily for it. Not only does the law force every American to purchase their products — the so-called “individual mandate” — but it also pads insurers’ bottom lines through a variety of direct subsidies designed to hide the true cost of premiums.
Among them are three programs: risk corridors; reinsurance and risk adjustment. Risk corridors and reinsurance pay insurers for taking on patients with high costs. Risk adjustment redistributes funds from plans with lower-cost enrollees — healthier, younger individuals — to higher-cost ones.
Yet even that wasn’t enough to make Obamacare plans affordable. Despite soaking up billions of dollars, the law is still forcing insurers to boost their premiums or withdraw from the market entirely. And with risk corridors and reinsurance expiring next year, taxpayers will start to see just how unaffordable their insurance truly is.
UnitedHealthcare, which this year covered 80 percent of enrollees on Texas’s Obamacare exchange, in 2017 will be departing the market altogether. And many looking for new insurance plans already found their choices severely limited when Blue Cross Blue Shield of Texas ceased offering PPO plans on the exchange in 2016.
The reason given for premium rate hikes is the “magnitude of losses” that Blue Cross Blue Shield’s exchange plans have faced over the last two years. In other words, even with reinsurance and risk corridors, the costs of providing coverage are too high. Yet the federal government is trying to urge Texans and others facing potentially skyrocketing premiums not to be alarmed. “Consumers will have the final word when they vote with their feet during open enrollment,” which runs from Nov. 1-Jan. 31, 2017, the federal Department of Health and Human Services noted.
That’s definitely true, but not in the way the federal government intended. One Texas insurance broker warns the premium increases will be “a very big disruptor of the market,” falling especially hard on rural communities. Since consumer subsidies can’t possibly keep up with the premium hikes, many people will be encouraged to forgo insurance entirely. The fines on those without coverage will often end up cheaper than ever-more-pricey premiums.
The latest announcement from Blue Cross Blue Shield makes this outcome all the more likely. It’s telling that not even bailouts could keep the company from requesting a staggering 60 percent average premium hike. Yet even before that, Texans were already hurting from the constant premium price spikes under the Affordable Care Act. Just this once, it’d be nice if everything wasn’t bigger in the Lone Star State.
Jerome Greener is the Texas state director of Americans for Prosperity.
JEROME GREENER | GUEST COLUMNIST Jul 13, 2016 Originally published in The Monitor
On July 1 the Obama administration announced a proposal to limit the duration of Short Term Medical Plans (STM Plans) to a maximum duration of 90 days. The proposed limit is open for public discussion for the next 60 days before they issue their ruling and Executive Order.
The Obama Administration is citing that millions of people are using Short Term Medical Plans (plans that are guaranteed “legal” to sell with a duration of up to 12 months per the original ACA law!) as a substitute for purchasing an ACA compliant “Obamacare” plan.
The popularity of Short Term Medical Plans is based on the need for health insurance that is actually affordable. My agency has noted a huge increase in the percentage of people who choose the STM Plan option.
The reasons my clients choose these Short Term Medical Plans are:
Lower costs – as much as 75% lower for people who do not qualify for subsidies.
Greater provider choice – In Texas and some other states the STM Plans are the ONLY way to get a large choice of doctors and medical providers ( PPO).
Easy application – Does not provide all their personal information to the Government.
The ACA has created a market Death Spiral. The rates are increasing on Obamacare plans in Texas by as much as 60% this fall (Jan 2017 effective date). Last year Blue Cross and other carriers dumped PPO plans as a cost saving measure. This year they have no choice but to raise the rates – which are already sky high! The result will be even MORE families being forced out of their traditional plans in search of affordable protection.
This suite of protections is built on the right to purchase a non-Obamacare plan and then use the savings to purchase other protections such as gap plans that reimburse deductible costs for accidents and sickness related hospital admissions. In addition, Dental and even a Living Benefit plan can be added to provide a large source of cash for the family to use as an emergency fund in the event of a chronic or critical illness. Thousands of my clients have chosen this as their preferred way of protection.
The recent Appeals court decision striking down the Obama Administration’s previous limit on Fixed Benefit plans bodes well for our continued use of this strategy. Previously, people were using fixed benefit plans (plans that pay so much per day for procedures) as an option in place of Obamacare. In 2010 the administration issued a ruling to stop the sale of such plans citing that it siphoned off sales for Obamacare plans and was hurting the risk pool.
A court case initiated by Central United Life has been heard and won (and now appealed and won again) in favor of limiting the Obama Administration’s reach into limiting peoples choices. Click here to read the NY TIMES article in full.
I believe that this ruling paves the way for the Obamacare ruling limiting STM plans (if passed) to be struck down.
Right now , it is your right and option to use this strategy. The proposal to limit the use of STM plans, if passed will become effective 1-1-2017. Act now to secure your coverage and protection.
Contact us to find out your eligibility and how much you can save. Stop paying too much for your health care! Click here or call me at 800-257-1723.