This past weekend, Democrats finalized their 2016 election platform at a meeting in Orlando. Oddly enough, it calls for the destruction of Obamacare.
“Americans should be able to access public coverage through Medicare or a public option” — that is, government-run health care — says the platform. In a nod to former Democratic presidential candidate Sen. Bernie Sanders, who supports a government-run, single-payer “Medicare for All” healthcare system, it also states that “health care is a right.”
They’re embracing single-payer because of Obamacare’s ongoing collapse. As a new report from Sen. Ben Sasse, R-Neb., makes clear, Obamacare’s exchanges are crumbling. Consumers in many parts of the country have access to only one or two insurers — and may soon have none at all.
If that happens, it’s a safe bet that Democrats will push for a government takeover of the healthcare sector.
Obamacare is to blame for the exchanges’ looming implosion. The law shackled insurers by imposing on them a host of regulations and mandates, such as “guaranteed issue” and “community rating.” These two provisions prevent insurers from denying coverage or charging any one person more than three times what they charge another.
That’s like the federal government dictating that car shops must fix any car — no matter how broken — and that they can’t charge someone who needs a new engine much more than someone who needs new windshield wipers.
To stay afloat, insurers have had no choice but to raise prices. Premiums have increased by 8 percent on average this year, according to the Obama administration. The nonpartisan Kaiser Family Foundation has concluded that premiums for Obamacare’s mid-level silver plans — the most popular plans on the exchanges — will increase by an average of 10 percent in 2017 in many major cities.
Double-digit increases are increasingly the norm. Insurers in New Mexico, Georgia, and Pennsylvania have requested hikes of more than 30 percent for 2017.
But these massive rate increases won’t end health insurers’ losses, which amounted to 11 percent in the exchanges last year. That’s more than double what they lost the previous year. According to consulting firm McKinsey, insurers lost money in 4 of every 5 states in 2014.
That’s prompted insurers to leave the exchanges in droves. United Health — the largest U.S. health insurer — has now withdrawn from more than 30 states. It will only sell plans in three next year.
BlueCross BlueShield just pulled out of Minnesota because of $500 million in losses. Humana has done the same in several states after posting a 46 percent drop in earnings in the first quarter of this year.
In 2015, 12 of the 23 non-profit, state-run CO-OP health plans created by Obamacare went under. Ohio’s and Connecticut’s just collapsed. These 14 failures have absconded with $1.5 billion in federal loans that will never be paid back. The remaining 9 CO-OPs may not be long for this world, either.
Sen. Sasse’s report dives even deeper by examining the number of health insurance plans available at the county level, not just the state level. County-level data offer a much better window into the number of choices exchange customers actually have.
Take Texas, for instance. Statewide statistics show that 16 insurers are offering plans on the exchange this year. That would seem to indicate a robust level of competition.
But no Texan actually has that many choices. More than 60 percent of the state’s exchange shoppers have just one or two insurers to pick from.
Choice is crucial for keeping prices down. When insurers have to compete for consumers’ business, they tend to lower their prices or improve their benefits’ packages. The addition of a single insurer in a county can lead to a premium reduction of up to 3.5 percent, according to a recent study published in Health Affairs.
But when an insurer has a monopoly or is part of a duopoly, it faces less pressure or incentive to keep its prices low.
The rest of Obamacare’s marketplaces are equally dysfunctional, noted Sen. Sasse’s report. One in three counties nationwide has only one or two insurers. More than 60 percent have three or fewer.
In fact, Obamacare has decimated competition in the individual insurance market. In 2013, the year before the exchanges opened, there were 1,235 insurers in the individual market. This year, there are 289 — a drop of 77 percent.
The Democrats have an answer for this decline in competition. It’s to destroy the market altogether.
They’re not just making empty promises in their platform. Former presidential candidate Sen. Bernie Sanders, D-Vt., has called for Medicare-for-All — a single-payer system that would replace all private insurance. Presumptive Democratic nominee Hillary Clinton has advocated for “Medicare-for-More,” which would allow people to join the federally-run health program for seniors in their fifties.
Whether it be BernieCare, HillaryCare, or Obamacare 2.0, Democrats are preparing to offer the country a choice on health care — a government-run choice.
Dems Fiddle While Obamacare’s Exchanges Burn
Sally C. Pipes
This past weekend, Democrats finalized their 2016 election platform at a meeting in Orlando. Oddly enough, it calls for the destruction of Obamacare.
“Americans should be able to access public coverage through Medicare or a public option” — that is, government-run health care — says the platform. In a nod to former Democratic presidential candidate Sen. Bernie Sanders, who supports a government-run, single-payer “Medicare for All” healthcare system, it also states that “health care is a right.”
They’re embracing single-payer because of Obamacare’s ongoing collapse. As a new report from Sen. Ben Sasse, R-Neb., makes clear, Obamacare’s exchanges are crumbling. Consumers in many parts of the country have access to only one or two insurers — and may soon have none at all.
If that happens, it’s a safe bet that Democrats will push for a government takeover of the healthcare sector.
Obamacare is to blame for the exchanges’ looming implosion. The law shackled insurers by imposing on them a host of regulations and mandates, such as “guaranteed issue” and “community rating.” These two provisions prevent insurers from denying coverage or charging any one person more than three times what they charge another.
That’s like the federal government dictating that car shops must fix any car — no matter how broken — and that they can’t charge someone who needs a new engine much more than someone who needs new windshield wipers.
To stay afloat, insurers have had no choice but to raise prices. Premiums have increased by 8 percent on average this year, according to the Obama administration. The nonpartisan Kaiser Family Foundation has concluded that premiums for Obamacare’s mid-level silver plans — the most popular plans on the exchanges — will increase by an average of 10 percent in 2017 in many major cities.
Double-digit increases are increasingly the norm. Insurers in New Mexico, Georgia, and Pennsylvania have requested hikes of more than 30 percent for 2017.
But these massive rate increases won’t end health insurers’ losses, which amounted to 11 percent in the exchanges last year. That’s more than double what they lost the previous year. According to consulting firm McKinsey, insurers lost money in 4 of every 5 states in 2014.
That’s prompted insurers to leave the exchanges in droves. United Health — the largest U.S. health insurer — has now withdrawn from more than 30 states. It will only sell plans in three next year.
BlueCross BlueShield just pulled out of Minnesota because of $500 million in losses. Humana has done the same in several states after posting a 46 percent drop in earnings in the first quarter of this year.
In 2015, 12 of the 23 non-profit, state-run CO-OP health plans created by Obamacare went under. Ohio’s and Connecticut’s just collapsed. These 14 failures have absconded with $1.5 billion in federal loans that will never be paid back. The remaining 9 CO-OPs may not be long for this world, either.
Sen. Sasse’s report dives even deeper by examining the number of health insurance plans available at the county level, not just the state level. County-level data offer a much better window into the number of choices exchange customers actually have.
Take Texas, for instance. Statewide statistics show that 16 insurers are offering plans on the exchange this year. That would seem to indicate a robust level of competition.
But no Texan actually has that many choices. More than 60 percent of the state’s exchange shoppers have just one or two insurers to pick from.
Choice is crucial for keeping prices down. When insurers have to compete for consumers’ business, they tend to lower their prices or improve their benefits’ packages. The addition of a single insurer in a county can lead to a premium reduction of up to 3.5 percent, according to a recent study published in Health Affairs.
But when an insurer has a monopoly or is part of a duopoly, it faces less pressure or incentive to keep its prices low.
The rest of Obamacare’s marketplaces are equally dysfunctional, noted Sen. Sasse’s report. One in three counties nationwide has only one or two insurers. More than 60 percent have three or fewer.
In fact, Obamacare has decimated competition in the individual insurance market. In 2013, the year before the exchanges opened, there were 1,235 insurers in the individual market. This year, there are 289 — a drop of 77 percent.
The Democrats have an answer for this decline in competition. It’s to destroy the market altogether.
They’re not just making empty promises in their platform. Former presidential candidate Sen. Bernie Sanders, D-Vt., has called for Medicare-for-All — a single-payer system that would replace all private insurance. Presumptive Democratic nominee Hillary Clinton has advocated for “Medicare-for-More,” which would allow people to join the federally-run health program for seniors in their fifties.
Whether it be BernieCare, HillaryCare, or Obamacare 2.0, Democrats are preparing to offer the country a choice on health care — a government-run choice.
Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.