Obamacare troubles update
About five weeks ago I approached the subject of Obamacare here. My point was that Obamacare, while maybe better than nothing, was a deeply flawed reform bill.
Since then there has been several studies and developments that you probably will never see on the GOS.
Today's news is the development of two chronic problems with Obamacare.
Highmark Inc. is suing the federal government over about $220 million it claims it is owed under ObamaCare.
The insurer filed a lawsuit Tuesday arguing the Obama administration has yet to pay up the money that is intended to help insurers make up for losses under the law.
Highmark is the second high-profile insurer to fight back in court against the administration’s risk-corridor program, a pool of money intended to help cushion insurers against the volatility of the new healthcare marketplace.
The administration announced last fall it would not pay insurers back the full amount of money owed under that risk-corridor program in 2014, the first year it went into effect.
Insurers were given only 12.6 percent of the money they claimed in 2014 because losses had been deeper than expected across the marketplace.
What we are looking at is a public subsidy to a private enterprise to make up for a structural flaw in Obamacare, which is not something the public would normally approve of.
Handing your tax money to corporations is a very big part of Obamacare, and will get bigger, because the deficits are growing larger.
The study from McKinsey & Company finds that in 2014, insurers had a margin of minus-4.8 percent, translating to an overall loss of $2.7 billion on the individual health insurance market, which includes ObamaCare’s marketplaces.
The study finds those losses roughly doubled in 2015 to between minus-9 and -11 percent margins, based on preliminary data.
Many insurers have been complaining about their losses on the ObamaCare marketplaces and are pushing for policy changes. Premium increases are expected to be higher for next year than in previous years, which is likely to become an election issue.
Still, the study finds that not all insurers lost money. In 45 states, there was at least one profitable insurer in the market in 2014, and 30 percent of insurers nationwide were profitable.
Yes, 30% made money, but 70% lost money.
And then comes the money shot.
“The individual market has little risk of entering a classic insurance ‘death spiral’ as long as the federal government continues to offer subsidies,” the study states, adding that “there will likely continue to be a large, viable individual market.”
...The study also points to a possible trend toward fewer doctor options for patients, as insurers that covered a narrower network of doctors were better able to control costs and lost less money.
Fewer doctors, and also fewer insurers.
“By that metric, insurer exchange participation not only declined in 2016, but also is now less than in 2014,” the report states.
With less competition and most health insurers losing money, combined with a government mandate to make up private losses, you can probably guess what the next development is about it be.
Over the last few years, average premium increases in the Obamacare markets have been lower than the increases for people who bought their own insurance in premiums before the Affordable Care Act. But several trends are coming together that suggest that pattern will break when plan premiums are announced in early November. Many plans may increase prices by 10 percent, or more. Over the last two years, I’ve written articles warning against scary headlines that exaggerate premium increases. Next year, those scary headlines are more likely to be accurate.
This will happen immediately after the November election.
Finally, there is yet one other problem with Obamacare that never would have happened under a Single Payer system - doctors turning down Obamacare patients.
AMY MOSES and her circle of self-employed small-business owners were supporters of President Obama and the Affordable Care Act. They bought policies on the newly created New York State exchange. But when they called doctors and hospitals in Manhattan to schedule appointments, they were dismayed to be turned away again and again with a common refrain: “We don’t take Obamacare,” the umbrella epithet for the hundreds of plans offered through the president’s signature health legislation.
“Anyone who is on these plans knows it’s a two-tiered system,” said Ms. Moses, describing the emotional sting of those words to a successful entrepreneur.
“Anytime one of us needs a doctor,” she continued, “we send out an alert: ‘Does anyone have anyone on an exchange plan that does mammography or colonoscopy? Who takes our insurance?’ It’s really a problem.”
Does the neoliberal solution have to fail completely before we can do what the rest of the civilized world is doing?
Comments
My carrier, UHS, as a retired NYS employee
I have a really good deal. Unpublishable. But UHS is threatening leaving some state markets and I have already heard rumors of 13% increase for next 11-month year. The structure was terrible. Insurance Companies have us by the balls. Which I don't have. 2 years until Medicare (if it exists then), probably no Social Security COLA increase, again.
I wrote the check for next month's coverage today.
Hey! my dear friends or soon-to-be's, JtC could use the donations to keep this site functioning for those of us who can still see the life preserver or flotsam in the water.
25% increase this past January 1
In Illinois, the rate of one carrier went up an even 25%
This is an ill conceived program that seems to be mainly a cash cow for doctors; insurance companies; and Big Pharma.
Obama failed us in yet another area.
Like you say, many have insurance now that didn't have it before and that's a big plus. But 27 million uninsured is just too many....Besides, we need to focus on delivery of health care services not health insurance.
Medicare operates on a 3% overhead. For profit insurance outfits operate on 18% and up. Medicare for all!
"The justness of individual land right is not justifiable to those to whom the land by right of first claim collectively belonged"
it wasnt
illconcived, it's playing out exactly the way the benofactors wanted it to.
Solidarity forever
Medical-loss ratio
requires that insurers spend 80 percent of every premium dollar on care; no more than 20 percent can be spent on administrative overhead and related costs.
Having said that, part of the problem with the law is that there is nothing to prevent legislation for changing that formula in the future to benefit the insurers. Medicare is a more straightforward plan, more resistant to that kind of meddling.
The complexity of the law makes it more palatable to industry groups. However, it is also part of the reason that 7 years later the popularity of the program is still underwater.
When Medicare was put into law it didn't a majority of Americans 7 years to figure that they liked it.
Also, one of the virtues of the Medicare for All option is consumers and taxpayers get a better return on their money AND it is also one of the ways to reduce the power of money in politics, because insurers and other groups will have less money available to spend influencing policy.
This is one of the virtues of the free public tuition program as well. The law provides a needed public service at a better cost; and taxpayers aren't being effectively billed for the added cost of "bribes" and lobbying that is done through less efficient privately run options.
It was always a giveaway to the insurance industry
We must pay them for crap coverage or face a financial penalty, and the govt subsidizes a boodle of plans to make them more "affordable." Yet those "affordable" plans leave people unable to cover the cost of co-pays and deductibles for medical visits and meds, and unable to access the health care system when they need it for reasons cited in this essay.
It's a huge boondoggle. It doesn't address the biggest problem: a health care system controlled by a for-profit industry that rewards withholding of services. Layers and layers of costly bureaucracy to deny claims time and again while layers of staff in medical offices exist solely to try to secure coverage for patients. It's bloated, it's obscene, it's unconscionable. And it's the beast that Obamacare--a Republican plan--was designed to feed one way or another. What we have is a Medical Industrial Complex, not a health care system. It deserves to die; we don't.
"It is no measure of health to be well adjusted to a profoundly sick society." --Jiddu Krishnamurti
I found this at nakedcap today,
I was gonna' put it in your Legacy Edition. Monthly Review
We wanted decent healthcare, a living wage and free college.
The Democrats gave us Biden and war instead.
Good article
I trusted nyceve and slinkerwink
on this issue in 2010. Both really thought it was very flawed, although all three of us supported it at TOP as better than nothing. It helps many, but it also is not enough.
And, as many projected, once it was passed, health care reform was over for along time.
Relying on private insurance is the big flaw.
I miss nyceve. She recommended one of my diaries during the Ides of March war, but she has not blogged for years now. Met here once in 2007.
That is, we all supported it at the end.
We fought like hell for the public option. OFA folks fought us, and many of the same folks who now support Hillary.
I was working for OFA at the time and was assured
that the public option was not dead. I was such a sucker! I did their lying for them without knowing I was lying for them.
Eyes - scales = Go Bernie!!!!
"The object of persecution is persecution. The object of torture is torture. The object of power is power. Now do you begin to understand me?" ~Orwell, "1984"
The Public Option Would Have Worked
The Public Option a.k.a. Medicare for All was the only thing other than the preferred single payer was the only chance for Obamacare to be sustainable. The Ins companies will always find ways to screw everyone so there needed to be a way to get them the fuck off of everyones back.
I disagreed with both of them when they supported
"pass it, then fix it."
What a killer joke. Literally.
I wrote nyceve to tell her about caucus99percent
and have not heard a reply. I think I'll send her a link to this essay. Would love to have both slinkerwink and nyceve posting here.
Shame on every damn Democrat who
didn't fight for a public option.
And shame on that guy over there who thinks Hillary's incremental plan, totally delusional, of enhancing Obamacare is the best way to go. And he's running for local office... while at the same time fueling fire about chairs being thrown.
Makes me angry.
He would come into my posts and insult me.
Sort of a jerk.
Good with data for counting Obamacare stuff.
He's in the past. That other place off in the mists. Can't even hear them from here.
An article written by a friend of mine
Doctors Agree With Sanders on Universal Health Care
"If we all threw our problems in a pile and saw everyone else's, we'd grab ours back" - Regina Brett
Yeh, but Unicorns
because they grow unicorns in every other 1st world nation
Great, gjohnsit! I'll use that retort. Often.
"Just call me Hillbilly Dem(exit)."
-H/T to Wavey Davey
There were a lot of spontaneous orgasms over at TOP
with the passing of Obamacare and predictions that Obamacare would result in decades of Democratic electoral dominance. Remember Rachel Maddow predicting the demise of the Republican party? I think I lost my right to comment for a while at TOP by correctly predicting the way that political theater would play out. That being said, I am favorably disposed toward HRC's recent proposal to drop the age of Medicare eligibility, essentially letting people buy in at an earlier age. This approach is incremental and inadequate (and likely HRC BS), but it does, unlike Obamacare, provide a pathway toward a single payer system and it might have some chance of being passed
Any valid step towards single payer is good!
So if Hillary could at least get the age for Medicare lowered, that would be nothing but a positive.
The cynic in me says that if it's happens it's just because that's the age bracket where the insurance companies are losing money on Obamacare plans.
That's not what it will do
I can't remember where I read this analysis -- probably on Naked Capitalism -- but it seemed quite sound.
Clinton's Medicare-For-Some-Middle-aged plan would create a Medicare death spiral. I may not be articulating this fully (it's a migraine day), but sicker, more vulnerable people would be the ones buying in. That would exacerbate insurance company skimming of the wealthy and healthy, put more pressure on Medicare without any of the necessary safeguards for there to be enough physician access and funding, and eventually destroy it. I can't remember the rest of the details, and I just did a bunch of Googling, and can't find the link. But "buying in" for a limited population simply isn't going work. And of course she won't advocate to just drop the age of universal access.
She's a liar. I don't believe anything she says.
Lowering the Medicare age has always appealed to
me as a way to increase coverage without reinventing the wheel. The only problem I see is younger people with pre-existing conditions. They are left out in the cold.
What would really have an impact
is to allow employers to buy in to Medicare for their older employees, and offer it as an option at the Open Enrollment period. For employers that have employees scattered over a large area, the lack of worry about coverage area would be great -- Mr. Scribe's former employer has to offer like about 4 or 5 different plans because some employees/retirees live here in the Bay Area while others commute from the Central Valley, and of course there are the retirees that move out of California altogether.
Three Of My Kids Have Covered California
AS all are unemployed, they get the most basic coverage. To provide realistic coverage would take more than I can afford to contribute, especially since I am paying for their support.
Obama's Legacy won't be realized until the insurance companies conspire to force the system to collapse. Then he's going to regret betraying Single Payer.
Vowing To Oppose Everything Trump Attempts.
I may just be cynical
but it sounds to me like essentially what I predicted. What is happening?
The insurance companies claim that they're losing money. (at least if you believe their books)
The previously uninsured were sicker than expected. (no shit Sherlock)
Doctors and hospitals and pharma are overcharging. (no shit Sherlock)
So what do the insurance companies propose? That the government make up the difference. (uh, Sherlock?)
But the government isn't paying - either they're reneging on the deal or the companies' claims are bogus - either is believable.
All expected, give or take a detail.
On to Biden since 1973
The law is overly complicated,inefficient . . .
and taxpayers and consumers pay a premium for those inefficiencies.
In some ways it is still an improvement over the system that predated it, and it has helped.
But it's a statement about just how corrupt the political system is that one of the most popular parts of the law, which also served as a critical cost-control measure, and which lowered the overall cost of the health care law -- the public option -- died even after it had been watered down.
There is no effective cost control, period.
This was clear to many of us insured under Romney Care here in Massachusetts. Doctors, hospitals and insurers all benefit when the "medical loss ratio" (aka profit margin) is defined as a percentage of a rising cost of providing care. Higher costs result in larger profits. Everyone "wins", except for the insured, of course.
Those who pay for their non subsidized insurance premiums will see significant and regular premium increases, as we in MA were already doing even as single payer and the public option failed to make it to the negotiation table. Subsidized premiums will also see premium increasees or a degradation in benefits, or both, to be paid for by taxpayers.
Both Romney Care and Obama Care were designed to expand the health insurance customer base and further enshrine the profit motive in the delivery of health care. It was not designed to restrain the upward spiral of increasing costs. Neither was it designed as a first step in prying the vampire squid tentacles of the insurance companies from the delivery of actual care to patients.
Capitalism is the extraordinary belief that the nastiest of men for the nastiest of motives will somehow work for the benefit of all."
- John Maynard Keynes
ACA problems.
I'll read the collection of personal stories tomorrow. Here's mine, condensed.
1) Three months of frustration and struggle, over 20 phone calls to Healthcare.gov "help"line in late 2013 just to get registered.
2) Final policy choice got lost due to multiple accounts opened in my name (by Healthcare.gov over the phone - I never could get their website to work) being sent to insurer, whose server rejected all as duplicates. Only asking to speak directly to the insurer's IT manager resulted in them finding my real account.
3) Based on advice from Healthcare.gov's "advanced resolution center", following 3 days of their research, I transferred funds from my 401k to pay down a loan, with the understanding (false) that the 401k withdrawal was NOT reportable income for purposes of determining my ACA subsidy. This resulted in a $750 tax penalty when filing for 2014, and another $750 in the 2015 tax year because I did not learn of the ACA's bogus advice until after I had done another withdrawal that year. I was getting about 4% interest in the 401k, and paid 4% interest on the loan - a wash, but paying down a loan is good, right? The incompetence of a flawed ACA system rushed in too fast, and mostly for political reasons, cost me $1500, and there's not a damned thing I could do but sue the federal government.
"If I sit silently, I have sinned." - Mossadegh
My story
I was a low income taxi driver, but I'd bought a condo, paid off the mortgage, and was saving money. But if Obamacare had come out in the 1980s when I started working I would never have saved enough to buy the condo, and I would have been evicted from a rental during the dot-com bust. I would have been the healthiest body in the SF morgue in 2001.
As it turned out, my health failed in 2014. My blood pressure was 245/145. My job was literally killing me. So I went to the Kaiser family Foundation web site and calculated what the cheapest available plan would cost. Even after the subsidy though I could "afford" it I would not be able to retire until at least 65 - but I would not live to 65 if I kept working. So I retired at 57 and went on MediCal, which fortunately is very generous. My blood pressure is now 128/68.
The moral? If you calculate what you can't do because of Obamacare rather than what you "save" thanks to the subsidy you see that it's a shitty deal, and By the way, doctors perform miracles when you get rid of the insurance companies.
On to Biden since 1973
HBP is a huge issue
for those who have to deal with traffic on a daily basis as part of their job -- I don't know a single bus driver who wasn't on meds withing 5-10 years of starting out behind the wheel.
I have spent years trying to determine the formula used
to calculate what payments are made to hit The Deductible. Not copays to doctors, tests, or premiums. Not out-of-pocket expenses, that's another line. Nov 2015 I fell and broke my olecranon (elbow). I went to the satellite ED where it was determined broken, splinted and sent off, with directions to call an orthopedist in the morning. One loose tooth, a black eye, a taxi paid to and from the orthopod's office, I was sent home to report for surgery that day. A ride from a friend back to hospital for same-day surgery, blood work, a CT, surgery, Ti implant, 13 sutures. Next day driven to get fitted for a prosthetic brace. Hospital bills came to over $16,000. I think I ended up paying about $2K. I think. And it's not over. But I am in another insurance year.
Hey! my dear friends or soon-to-be's, JtC could use the donations to keep this site functioning for those of us who can still see the life preserver or flotsam in the water.
The free market myth
There are lots of flaws with ACA. But let's start with what it will never achieve, free market choices. At least not for most of us.
A free market suggests you can select from a myriad of choices based on features that most appeal to you. Well guess what ? Americans like the cheapest features. What will cost me the least out of pocket and still get some kind of access to healthcare.
So at the end of the day what we have that are successful in a market place like this are, mostly cheap ass coverage with few doctor choices and high co-pays and deductibles. For people with medical need, we have lousy coverage with lower out of pocket caps. There's lots of fancy cadillac plans for rich folks, but those folks were never a problem anyway were they ?
Now in the great bounty of the free market, we can assume medical care is aberration. I mean it's complex, expensive and has high cognitive dissonance as a result. But guess what ? Go shopping for a paint brush for your house. These items are fairly inexpensive and not all brushes are for the same application. You woudl think there would be a veritable buffet of choices but there isn't. I can go to Wal Mart, my local hardware store or an independent paint supply house and the brands are all the same and mostly, so are the prices. The independent store carries some higher quality brushes for the pros from a boutique brand but that's it.
Through technology, acquisitions and mergers and transnational profiteering, you get little choice. You can always choose to pay more - until it becomes more than you can afford. The free marketeers are just a bunch of hucksters, except the libertarians who are just dummies. The latter believes if you can get a market free enough, than quality will shine through and the best companies will survive.
The sooner we get to single payer or medicare for all model, the sooner we will get everyone covered and lop off all this waste.
Fundamental problem with US business/government
This certainly isn't unexpected. Moaning about death panels aside, the right wasn't entirely wrong to criticize the ACA. They just chose the worst way to go about it, as usual, focusing on the wrong things and rather than work to improve it just stonewalled and wailed like infants.
But the problem seems to be something fundamentally wrong with the way the US implements half-measures like ACA. The problem isn't "socialism" or "the free market" by themselves, it's that we always seem to end up with the worst of both worlds. We get the excesses of the free market but without actual competition so we don't see the increased quality and lower pricing, instead we get the opposite. We get the heavy hand of regulation from government but it's applied unevenly and used to support crony capitalism, protecting friends and punishing enemies, and usually supporting massive corporations at the cost of small businesses.
Unfortunately I'm only a critic, I have no solutions.
Just tweeted this out
Everyone should be doing this who has a twitter account or if you are on Facebook share this essay please.
"You can't just leave those who created the problem in charge of the solution."---Tyree Scott
More Obamacare troubles
NY too