Where have all the insurance carriers gone on the Exchange for ObamaCare?! Remember, when the ACA/Affordable Care Act (also known as ObamaCare) was passed, we were all told how it would save us money, lower costs and ensure coverage for all. Well, not really. Costs for coverage have skyrocketed even if you have a government subsidy, and carriers are dropping off the exchange at an alarming rate due to huge losses in their individual insurance book of business with:
- United reporting 600 million dollars in losses so far this year and cancelling 765,000 policies.
- Aetna reporting 300 million dollars in losses and withdrawing from all but a handful of states.
Humana is also pulling off the Exchange in some markets. That leaves the Blue Cross and Blue Shield plans, and, depending on which state you are in, you may or may not have access to a Blue Cross plan.
So, what caused all of this chaos in the Marketplace? Let’s start with a badly designed plan for the implementation of ObamaCare. Remember, the plan was going to work because everybody was going to buy health insurance, and the young people (i.e. millennials) were going to sign up in droves because they loved ObamaCare and supported the President. Unfortunately, that didn’t happen. Older, sicker people signed up, and younger people paid the $695 penalty because it was cheaper than health insurance. So, claims dollars paid out are higher than premiums paid in, and that is why carriers are losing massive amounts on the Exchange and pulling off.
This could be fixed by making the penalties much higher and equal to a year’s premium–$2,000 or more. Remember, the law says we must all buy health insurance. Another part of the solution is to stop allowing people on the Exchange after open enrollment so they can’t game the system by signing up when they are sick and then dropping coverage afterwards. The last piece of the puzzle to fix ObamaCare is to set up a government run risk pool to absorb claims over $250,000.
ObamaCare can work but not without changes that allow carriers to function in the Marketplace.
America’s Healthcare Advocate