The Abysmal Rollout of Obamacare going According to Plan to bring us to National Health Care?

Posted by PITHOCRATES - February 16th, 2014

Week in Review

The roll out of the Affordable Care Act (i.e., Obamacare) has given us a plethora of unintended consequences.  From freezing new hiring.  To pushing full-time workers into part-time.  To people losing the health insurance and doctor they liked and wanted to keep.  To higher insurance premiums. To higher deductibles.  To higher co-pays.  Taking a health care system that the vast majority of people were satisfied with and making it worse.  To accommodate a small percentage of the population who were uninsured.  If that wasn’t bad enough it doesn’t even look like some of the people who signed up for Obamacare are paying their insurance premiums (see Next problem for Obamacare: deadbeat enrollees by Rick Newman posted 2/14/2014 on Yahoo! Finance).

The  New York Times has discovered  that only about 80% of people purchasing health insurance through the federal online marketplace or a similar state-run exchange paid their first month’s premium. There’s no single source of such data, but the Times canvassed insurers participating in the program, such as Aetna (AET), Wellpoint (WLP), Humana (HUM) and Blue Shield of California. All said that the first-month payment rate ranged from 75% to 80% or so, far lower than for typical plans. If enrollees don’t pay the first month’s premium, their insurance never goes into effect.

That doesn’t mean, however, that one-fifth of the people signing up for Obamacare are blatantly refusing to pay. Technical problems with some of the exchange websites may have left people enrolled in an insurance plan without knowing it. Some may never have received a bill or confirmation of their enrollment. Others may have unwittingly signed up for two different policies, while paying for only one.

To make the Affordable Care Act work required a huge health care cost transfer from the old and sick to the young and healthy.  The young and healthy, incidentally, made up a sizeable portion of the uninsured.  Because they were young and healthy and felt invincible.  And invincible people don’t need to buy insurance.  So Obamacare needed the individual mandate to force these people to buy insurance against their will so they could pay for the old and sick.

Of course when they raised the price of health insurance to cover pre-existing conditions it wasn’t the young and healthy that ran to the Obamacare exchanges.  It was the old and sick.  Adding too many old and sick to the insurance pool.  And not enough of the young and healthy.  Those who would pay without consuming any benefits.  Because they are young and healthy.  Causing the insurers to pay more out in benefits than they receive in premiums.  Forcing them to raise their premiums.  Which will, of course, kick off the death spiral as people drop out because they can’t afford those higher rates.  Which will, in turn, force the insurers to raise their rates again.  Hence the death spiral.   And as bad as all of that was now it looks like about 20-25% of those who ‘signed up’ either didn’t or are simply choosing not to pay.  Making the financial predicament of the insurers far worse.

Of course if your plan was to force single-payer (i.e., national health care) onto the people against their will then everything is going according to plan to destroy the private insurance market.  Leaving only the government to step in and provide single-payer (i.e., national health care).  Which should fill everyone with confidence after seeing how well they rolled out the Affordable Care Act.  And no doubt will impress us even more with the rollout of single-payer (i.e., national health care).

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