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Massive shortfall in government payouts to insurance companies promises big premium increases
American Thinker ^ | 10/27/2015 | Rick Moran

Posted on 10/27/2015 7:50:49 AM PDT by SeekAndFind

The government program to reimburse insurance companies with big losses as a result of signing up too many old and sick customers is massively short of funds and could cause some companies to either go under or get out of the Obamacare exchanges.

The so-called "risk corridors" that forced profitable companies to pay into a fund that would be disbursed to companies who lost money is underfunded by 88% and will almost certainly lead to big changes in premiums and consumer choice on the exchanges.

Washington Examiner:

Obamacare insurers requested about $2.9 billion in risk corridor payments for the 2014 calendar year, but they only received $362 million, a mere 12 percent of what they asked for. The shortfall happened because insurers requested more than what was paid into the program.

The result has been devastating for some insurers. WinHealth, which provides coverage in Wyoming, went into receivership last week because of a low risk corridor payment.

It will suspend insurance sales in 2016, leaving about 8,200 residents to search for a new plan from the sole remaining insurer in the Obamacare marketplace.

In addition, nine taxpayer-funded insurance co-ops have closed recently, with some blaming the low payments.

The shortfall hit small insurers that don't have enough reserves to cover them, said Deep Bannerjee, director of ratings at credit ratings agency Standard & Poor's.

Bannerjee didn't give an exact number on how many insurers could fall but said the "shakeup will continue."

Instead of shutting down, insurers most likely will react to the shortfall through raising premiums since they can't count on the risk corridor money, he said. They also could shift their plans away from offering a more open network to a narrow network such as an HMO.


(Excerpt) Read more at americanthinker.com ...


TOPICS: Culture/Society; Government; News/Current Events
KEYWORDS: 0carenightmare; exchanges; healthcareinsurers; insurance; obamacare; obamacarecosts; premiums

1 posted on 10/27/2015 7:50:49 AM PDT by SeekAndFind
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To: SeekAndFind

Aren’t insurance companies also restricted in how much they can raise insurance rates under CommieCare?

Sounds like they will be squeezed out of business by their competition; the single payer government health provider.


2 posted on 10/27/2015 7:53:55 AM PDT by fwdude (The last time the GOP ran an "extremist," Reagan won 44 states.)
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To: SeekAndFind

. . . and single payer to the rescue . . .


3 posted on 10/27/2015 7:54:22 AM PDT by mykroar ("Never believe anything until it has been officially denied." - Otto von Bismarck)
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To: SeekAndFind

Do they mean higher than they’ve already gone?


4 posted on 10/27/2015 7:57:22 AM PDT by skeeter
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To: SeekAndFind

And the worst part is that Obama, the Dems and the MSM will be able to demonize insurance companies as if they are doing this on their own to hide the fact that its really Obamacare that created the mess.


5 posted on 10/27/2015 7:58:57 AM PDT by Opinionated Blowhard ("When the people find they can vote themselves money, that will herald the end of the republic.")
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To: SeekAndFind
But, but what about all of the promises? /sarc

We, the informed voters, could see this coming a mile away. The frustrating thing is that the majority voters in the past and future elections don't have a clue that they have been scammed and that it was all a big crock of poop.

I bet most of the proponents of Obamacare are now trying to figure out how to game the system so that they don't have to pay the premiums and maybe even get free health care while the rest of us law abiding tax payers pay for their stupidity.

6 posted on 10/27/2015 8:02:35 AM PDT by dhs12345
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To: mykroar

Bingo. I thought it would happen in the next administration. But we may get single payer a lot sooner than that.


7 posted on 10/27/2015 8:04:44 AM PDT by Buckeye McFrog
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To: SeekAndFind

Oh you’re kidding.
But I thought it would be like $15/hour minimum wage where a company would just absorb the extra cost rather than passing it on... no?


8 posted on 10/27/2015 8:08:19 AM PDT by envisio (I ain't here long... I'm out of napalm and .22 bullets.)
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To: fwdude

economics is hard


9 posted on 10/27/2015 8:09:15 AM PDT by envisio (I ain't here long... I'm out of napalm and .22 bullets.)
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To: SeekAndFind

until Obama’s hide is nailed to the wall, there is no solution

Pelosi’s and Reid’s need to be nailed there also


10 posted on 10/27/2015 8:11:23 AM PDT by bert ((K.E.; N.P.; GOPc.;+12, 73, ....carson is the kinder gentler trump)
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To: Buckeye McFrog

No worries. This is actually double-plus good.


11 posted on 10/27/2015 8:12:18 AM PDT by fwdude (The last time the GOP ran an "extremist," Reagan won 44 states.)
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To: SeekAndFind
In late 2014, the "cromnibus"... making the risk corridor program revenue neutral... which slashed the expected payments.

Something good in the cromnibus.

12 posted on 10/27/2015 9:03:48 AM PDT by MUDDOG
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To: SeekAndFind

Health insurance is not worth the cost, which is why I don’t have any.


13 posted on 10/27/2015 9:17:33 AM PDT by cuban leaf (The US will not survive the obama presidency. The world may not either.)
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To: SeekAndFind

The insurance companies expected the democrats to keep their end of the bargain? HA!


14 posted on 10/27/2015 9:24:31 AM PDT by minnesota_bound
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