Obamacare: Two Maps Depicting The Impending Decline Of Choice And Inevitable Increase In Price

By | August 29, 2016

For any business owner and/or American concerned with the affordability and availability of quality healthcare, the two maps in this article should be very concerning!

On August 16 I had written an article titled, ‘Commentary: Politicians And Empty Promises!‘, that focused on the political process and the empty rhetoric that politicians from both party’s spew pandering for votes.

Given that fact, a critical point that it’s incumbent for voters to focus on as we enter the final leg of what is unfortunately passing as the presidential campaigns of our two major political party’s, is this:

…Regardless of political party affiliation listen less to what the politicians running for office are promising, and more to whether what they promise is actually viable or economically feasible…

Then Candidates Get Elected!

Once a candidate is elected to office the empty rhetoric and pandering for votes does not stop, but simply morphs to where they attempt to push some legislation through that they ‘promise’ will be a panacea for a major problem in the country.

Then if they do get it through Congress and sign said legislation into law, the reality of business and economic viability that some had understood before the fact and been ignored by the masses, will likely come to painful fruition after the fact.

Why is that? Ronald Reagan’s nine most dangerous words in the English language go a long way towards explaining the issue: ‘‘I’m from the government and I’m here to help.

…what the politicians know that they can never let the voter know, is that the promises made are all likely a fools errand.

That in any world that exists beyond the walls of the political elites in Washington or in state capitals, whatever proposal they are laying out has little to no chance to be successful and likely is not fiscally achievable!

But the actual potential success or cost of the program, for whatever politician is speaking about it, is in many ways irrelevant and secondary to their immediate task at hand.

This is because in the end they will ultimately not be responsible or accountable for either. The taxpayers will!…

Case in point, as the two maps below clearly indicate, Obamacare!

Promoted as an affordable and seamless addition to our current system of heath insurance, the American people were promised some important things:

  1. If you like your doctor you can keep your doctor,
  2. Healthcare costs would go down and not up,
  3. There would be a larger menu of choice of health insurers for all.

And then business and economic reality came face to face with government promises.

  • ‘The lifeblood of the program, young and healthy individuals, failed to enroll. ‘The first big problem for Obamacare is that it hasn’t attracted the most sought after customers: healthier young adults. Since young adults are less likely to go to the doctor, or to need expensive medical care, their premiums are used — and needed — to offset the costs to treat older and often sicker individuals. Although young adult enrollment improved in 2016 from the previous year, there are still not enough young adults enrolled in Obamacare to make a favorable difference for insurers. Two factors explain the weakness in young adult enrollment. To a lesser extent, the “invincibility” factor is playing a role. Young adults who feel healthy and/or don’t visit their doctor regularly would just as soon not be insured. Reaching this “invincible” crowd of young adults could prove tough for Obamacare.But I believe the bigger factor is that the Shared Responsibility Payment, or SRP, isn’t an adequate incentive to coerce young adult enrollment.’ 
  • Actual enrollees into Obamacare have turned out to be sicker and more costly than projected (see pre-existing conditions not excluded from coverage). ‘According to a study conducted by the Blue Cross Blue Shield Association in April, after analyzing the medical claims of roughly 25 million employer-based group members, the average cost per member was $457 a month through the first nine months of 2015. Comparatively, analyzing 4.7 million individual Obamacare enrollees produced a monthly cost of $559 over the first nine months of 2015. That works out to a 22% increase over employer-based membership.’ 
  • The ‘Risk Corridor’ proved to be a failed concept. The risk corridor represented a type of risk-pooling fund among insurance companies operating on the Obamacare marketplace exchanges. Here’s how it worked: Insurers that were excessively profitable would be required to put some of those excess profits into a fund. In turn, insurers that were losing excessive amounts of money because they priced their premiums too low would be able to request funds from this risk corridor in order to stay afloat. In effect, the risk corridor was designed to promote competition, especially among new insurers in the individual market, and give insurance companies a year or two to find the sweet spot when it came to pricing their premiums. Unfortunately, the risk corridor ran into plenty of issues. Just $362 million wound up being added because most insurance companies weren’t overly profitable. In contrast, insurers wound up requesting $2.87 billion from the risk corridor to cover big losses. With only 12.6% of requested funds being paid out, many smaller insurers were forced to close up shop, including 16 of Obamacare’s 23 approved healthcare cooperatives, or co-ops.
  • Less choice among insurer options means soaring premiums. Nancy Pelosi: ‘Affordable, affordable, affordable, affordable!‘ Of course the reality is somewhat different. ‘The final reason your premiums are soaring relates to a declining number of insurer options to choose from. As noted above, the failure of the risk corridor has eliminated more than two-thirds of the available healthcare cooperatives, and there may be more failures to come. But it’s not just low-cost options that are bowing out.’ 

Conclusion

Bottom-line? Regardless of political party affiliation you must listen less to what the politicians running for office promises, and look more at whether what they promise is either viable or economically feasible!

And then do your work without relying on others to do it for you to choose who you think will be the best leader for our country!’

Maps: 2016-2017 Obamacare Healthcare Insurance Carriers By County (Source)

2016 healthcare insurance carriers by county:

government failure

 

2017 healthcare insurance carriers by county:

Business and politicians

 

Michael Haltman is President of Hallmark Abstract Service in New York. He can be reached at mhaltman@hallmarkabstractllc.com or at 516.741.4723.

 

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