Posted on 12/18/2013 5:02:22 AM PST by Kaslin
When will the insurers revolt?
It's a question that's popping up more and more. On the surface, the question answers itself. We're talking about pinstriped insurance company executives, not Hells Angels. One doesn't want to paint with too broad a brush, but if you were going to guess which vocations lend themselves least to revolutionary zeal, actuaries rank slightly behind embalmers.
Still, it's hard not to wonder how much more these people are willing to take. Even an obedient dog will bite if you kick it enough. Since Obamacare's passage, the administration has constantly moved the goalposts on the industry. For instance, when the small-business mandate proved problematic in an election year, the administration delayed it, putting its partisan political needs ahead of its own policy and the needs of the industry.
But the insurers kept their eyes on the prize: huge guaranteed profits stemming from the diktat of the health insurance mandate. When asked how he silenced opponents in the health industry during his successful effort to socialize medicine, Aneurin Bevan, creator of the British National Health Service, responded, "I stuffed their mouths with gold."
Hence, the insurers were ready on Oct. 1. They rejiggered their industry. They sent out millions of cancellation letters to customers whose plans no longer qualified under the new standards set by the Affordable Care Act. They told their customers to go to the exchanges to get their new plans.
But because President Obama promised Americans "if you like your health care plan, you can keep it," (PolitiFact's "Lie of the Year"), those cancellations became a political problem of Obama's own making.
In response, the president blamed it on the insurance companies or "bad apple" insurers. White House spokesman Jay Carney insisted that it was the insurance companies that unilaterally decided not to grandfather existing plans. (The Washington Post's "Fact Checker" columnist, Glenn Kessler, gave this claim "Three Pinocchios.")
Then, just last week, Health and Human Services Secretary Kathleen Sebelius announced that she was "urging" insurers to ignore both their contracts and the law and simply cover people on the honor system -- as if they were enrolled and paid up. She also wants doctors and hospitals to take patients, regardless of whether they are in a patients' insurance network or even if the patient is properly insured at all. Just go ahead and extend the deadline for paying, she urged insurers; we'll work out the paperwork later.
Of course, urging isn't forcing. But as Avik Roy of Forbes notes, the difference is subtle. Also last week, HHS also announced last week that it will consider compliance with its suggestions when determining which plans to allow on the exchanges next year. A request from HHS is like being asked a "favor" by the Godfather; compliance is less than voluntary.
The irony, as Christopher DeMuth recently noted in the Weekly Standard, is that if the architects of Obamacare had their way, the insurers would have been in even worse shape today. The original plan was for a "public option" that would have, over time, undercut the private insurance market to the point where single-payer seemed like the only rational way to go. If it weren't for then-Sen. Joe Lieberman's insistence that the provision be scrapped, DeMuth writes, "Obamacare's troubles would today be leading smoothly to the expansion of direct federal health insurance to pick up millions of canceled policies and undercut rate increases on terms no private firm could match."
In other words, the insurers knew the administration never had their best interests at heart but got in bed with it anyway.
Articulating my sympathy for the insurance companies is difficult without the accompaniment of the world's smallest violin. But, still, I have to wonder, do those running these firms have no backbone whatsoever? I understand that the insurance companies have been consolidating into de facto utilities for decades. But they at least once mustered some passion for defending their status as private enterprises. Sure, they have obligations to shareholders, but their obligations do not end there. Can't one of them resign on principle and speak up? Or are their mouths so stuffed with gold that they couldn't get the words out even if they tried?
Hostages should be seen and not heard.
One thing we need to stop doing—hating on the insurance companies. Obama desperately wants to shift the outrage…and we’ve all hassled with insurance companies, but Obama’s long-term plan is to put them out of business. Then we will truly be helpless.
Well said. Everyone needs to focus on what the authoritarian Obama is doing and how health care will be when there is no recourse from a government which holds your life in its bureaucratic hands.
>>When will the insurers revolt?<<
“Sir the insurers are revolting.”
“You betcherass — they stink on ice!”
They'll take what they can get and if that means providing free advertising for obamacare then free advertising it is.
The option is endless litigation in a kangaroo packed court and a smear job by the state run media.
“Of course, urging isn’t forcing. But as Avik Roy of Forbes notes, the difference is subtle. Also last week, HHS also announced last week that it will consider compliance with its suggestions when determining which plans to allow on the exchanges next year. A request from HHS is like being asked a “favor” by the Godfather; compliance is less than voluntary.”
That may be so, but in automated systems you can’t do whatever you want. They have no employees processing claims, it’s all computerized. Those who do not have policies will have their claims rejected.
Jonah Jonah Jonah
it’s so obvious
the insurance companies ARE IN ON IT
waiting for all that lovely government money to stream in....
waiting for all the new insureds FORCED BY THE GOVERNMENT TO PURCHASE THEIR PATHETIC PRODUCT
Don’t you believe if what the insurance companies were hawking was a good product people wouldn’t be FORCED BY THE GOVERNMENT TO BUY IT
the insurance companies are IN CAHOOTS with the government
Obama is definitely trying to shift the outrage, and while insurance companies certainly deserve some of the blame for not standing up to Obama and trying to prevent Obamacare while there was time, I think many of them were not only greedy for the handouts he promised them, but actually afraid to oppose him. Remember, they had already had his attacks on private industry during the first term as an example of how he would use the government to destroy any opposition, and I think some of the companies simply felt that all was lost and there obviously was not enough political or popular support to protect them.
We’ve never before seen a government so set to destroy private businesses or even an entire industry.
The 20% markup on cost might be a clue. Do you think the feds have a real shot at auditing the charges? Insurance execs are all pissing their pants over the thought of mega profits.
I think it's a little more complicated than this.
I've said all along that the long-term goal of the insurers is to get out of the business completely. An insurance pool can't be sustained for long under the upside-down demographic profile of this country, so they knew damn well they were going to be driven out of business anyway. Who wants to be an insurance carrier in an era when a disproportionate number of your customers are in the 40-65 age group and facing the peak years of their claims?
All we're seeing here is the whole house of cards collapsing sooner than anyone really expected.
It’s a tax code benefit versus current revenue. My guess is that the execs will keep their mouths shut.
Insurers, Doctors, and Hospitals, have all been blackmailed into either silence or support.
The IRS is a terrible weapon to waste.
Our health care payment system has been pretty much a giant unguided missile and what the ACA did was provide a spark to the middle of the fuel tank. Who knows what piece is going to land where when the smoke finally clears? I don't know, but it's not going to be the result that the libs envisioned.
One anecdote was of a woman who believed the promise of keeping her doctor.
After she signed up, she was looking for her doctor among the choices and didn’t find him.
She went to his office and they called in to ask how to get her doctor on the list.
The answer was “that information is confidential”.
They put up with crap for a while longer and see how it goes. They can come out great in the end
1) Mandated purchases of crappy insurance
2) Additional sales of “useful” insurance supplements (access to larger doc networks & the best hospitals, better drug coverage, lower deductible etc)
3) Turn the MLR around and use it to request 20% higher premiums than medical costs. Then jack up medical costs (stop negotiating tough with providers) and blame congress & the regulators for the higher premiums. Or, if regulators don’t accept the higher premiums point out what coverage the “death panel” regulators won’t let them provide.
4) Use “it’s the ACA’s fault” as an excuse for almost anything customers complain about. Whether or not that’s true is almost impossible for any consumer to find out.
They have to put up with a lot of crap now but can make more money and blame the ACA for a long time if they handle it right. Alternatives that would put more control in consumer/patients’ hands and drive down medical costs will likely cost insurers a lot.
Anyone see Chris Wallace’s interview of Ezekiel Emanuel? The smarmy bastard tried every rhetorical trick he could to put a shine on the Obamacare sneaker, but I liked his eventual answer to Chris’s question about whether enough young people will sign up to make the system actuarily viable. Zeke’s response was telling: young people would start to sign up in droves when they saw what a good deal they’d be getting due to subsidies. In other words, he expects people to sign up when it’s to their advantage, while the redistributive economics of the system require the people who are getting statistically screwed to pay into it to make it work. The insurance companies are going to be announcing double-digit annual price-hikes for quite awhile.
Insurance Industry = Unindicted Co-Conspirators of Obamacare
You know everytime I have a prescription filled they know exactly what insurance I have, whether it is up to date or not, what meds they will cover, and the copay.
It is all automated.
The Legal Limit: The Obama Administration's Attempts to Expand Federal Power -- Report No. 2: Obamacare "The Administration’s Lawless Acts on Obamacare and Continued Court Challenges to Obamacare / By U.S. Senator Ted Cruz...
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