Posted on 04/19/2016 5:54:06 AM PDT by TigerClaws
Two weeks ago we reported that after its November warning that it may exit certain Obamacare markets as a result of substantial losses, the largest U.S. health insurer UnitedHealth, did just that when it announced it would no longer sell plans for next year in Georgia and Arkansas.
Then over the weekend, UnitedHealth also added Michigan to the list of states whose Obamacare market it would no longer service. As Bloomberg reported, "the insurer won’t sell policies through Michigan’s ACA exchange for next year, according to Andrea Miller, a spokeswoman for the state’s Department of Insurance and Financial Services. Georgia and Arkansas said last week that UnitedHealth will quit their exchanges for 2017."
And then, moments ago in the latest hit to Obamacare, United added Oklahoma as the 4th state to the growing list of Obamacare markets it refuses to service.
What will the consequences of this exodus be?
According to Bloomberg, "while Michigan and Arkansas can probably weather UnitedHealth’s move, some consumers in Georgia and Oklahoma may feel a lack of choices, according to a Kaiser Family Foundation analysis of UnitedHealth’s offerings across the U.S."
Michigan should be able to endure the loss of United because the insurer only participates in seven of the state’s 83 counties, and it’s not among the cheapest in any of those counties, according to the Kaiser analysis. United also wasn’t offering cheap plans in Arkansas. In Georgia, however, the loss of UnitedHealth will cut the number of insurers to just one or two in about half of the state’s counties, though those counties account for just 11 percent of the state’s population. The insurer offered one of the cheapest plans in 34 of the state’s 159 counties.
Worse, on the current trend, UnitedHealth will likely announce the exit of more states in the coming days.
The reason is that Obamacare’s success depends on insurers selling plans in government-created markets, called exchanges, in each state. The fewer insurers participating, the harder it is for the program to achieve its goal of extending coverage to more Americans. Other states where consumers would have the most to lose if UnitedHealth drops out include Alabama, Louisiana and Tennessee, according to the Kaiser study.
And since by definition, that is also where UnitedHealth is losing the most money on this foolishly constructed attempt to centralize health insurance, those are the markets where UnitedHealth (and soon others) will likely exit next.
"It’s likely that in places where they were one of the only insurance companies, and they priced low relative to their competitors, they’re important players,” Cynthia Cox, one of the report’s authors, said by phone. "In certain areas, there would be a need for individuals to shop around."
According to Bloomberg calculations, UnitedHealth offered ACA plans in 34 states for the current year. If UnitedHealth left all those states’ exchanges, about 3 million ACA enrollees would see their choices reduced to just one or two insurers for next year, the Kaiser study shows. About 9 million people would still have three or more plans to pick from.
Naturally, the government is eager to downplay these accelerating defections, alleging that UnitedHealth is at best a marginal player in the state exchanges it has vacated: "the U.S. Department of Health and Human Services said the report shows that UnitedHealth plays a relatively small role in the ACA’s markets. HHS has previously said it expects insurers to enter and exit the ACA each year, and that it expects the ACA’s exchanges to “continue to thrive.”
That, of course, assumes that other insurance providers won't leave next; and they likely will because the way Obamacare is structured, not only being the "last company standing" in any given market, and thus being the much desired monopoly, will provide incremental benefits to either the top or the bottom line.
As for UnitedHealth, as noted above, it will likely announce more defections in the coming days. Other states where UnitedHealth posted big losses in its individual business include Florida, North Carolina, New York, Alabama and Louisiana, according to Ana Gupte, an analyst at Leerink Partners. She said UnitedHealth will probably take into account those losses as well as its 2017 outlook as it decides which states to exit.
Bloomberg adds that if UnitedHealth left the New York exchange, every consumer in the state would still have at least three plans to pick from. Here’s what a UnitedHealth exit could mean in some other states:
Alabama: Two-thirds of the state’s population would have just one choice of insurer, and the rest would have two. United offers one of the least-expensive plans in 66 of the state’s 67 counties. Louisiana: Consumers in most of the state would have just two health plans to pick from. UnitedHealth offered one of the cheapest plans in about three-quarters of the state. Florida: It’s the state with the most Obamacare enrollees. More than a third of them would have a choice of only one or two health plans if UnitedHealth exited.
But the scariest news for the president's legacy healthcare program is that UnitedHealth is far from the only insurer struggling with selling individual health plans, which includes ACA plans. Industry-wide, insurers spent $1.02 on medical care for every premium dollar they took in last year, meaning they lost even more money when administrative expenses are included, according to Brian Wright, an analyst at Sterne Agee CRT.
It also means as UnitedHealth boldly exits more and more states, many others will shortly follow. Average:
Single payer here we come.
United Health = AARP
Don’t you love it when a plan comes together just like you envisioned it? /s/
It's for analyses like this that massive Leftist foundations are paid the big bucks.
Single payer here we come.
**************
With Republican support probably. Paul Ryan funds whatever the Dems want.
You’re gonna see the Public Option before the 2017 football season starts.
Correct. The Leftist foundations and liberal “think tanks” rake it in.
Obama “bent the cost curve” so far he broke it.
What perfect timing. The whole mess of,Obamacare totally collapses just in time for Commisar Sanders to fix it.
You are right. That was the plan all along.
Single payer here we come.
I have a different take on all this. I believe Obama care was supposed to work just enough but still have big problems so that the politicians could fix those problems with the usual governmental fixes there by eventually bringing us to single-payer. I can’t imagine that we were going to get government healthcare byways of a spectacular failure of one government program
The reason why I feel this way is because Obamacare was passed by people who do believe our problems can be fixed by government. People like Barack Obama do not believe that government programs fail.
All this is just my opinion of course
Who cares? Nearly everyone who signed up for Obamacare is on Medicaid anyway.
Obama had previously tipped his hand in speeches to union groups. Said that he personally preferred single payer but that it was not possible to get there “in one step”.
But, but, but...
What about too big to fail?
VA-FAIL, Medicare-FAIL, Medicaid-FAIL...
If at first you don’t succeed,
THROW MORE MONEY AT IT!
from the Democrat Big Book of Proverbs, Vol, I
You left the “/s” after “probably”. :-)
The Republican party has always been the party of the crony capitalists.
So, with no private insurers, what exactly is a person to do?
But, but Obama said if you like your plan, you can keep your plan. How many people lost their first plan they actually liked and now a second they don’t like for a third even worse option?
Obamacare provider failures are like General Motors product failures. I celebrate every single one of them. Obamacare companies hoped to profit from selling under threat of force to unwilling buyers, which is both corrupt and an evil business plan. GM investors knowingly and willingly stole from the rightful claimants on GM assets, or later investors profited from that theft, and they all deserve to lose every penny invested. The General Motors bailout was just as corrupt as the Obamacare vote, and the winners on both massive thefts do not deserve forgiveness until their companies are bankrupt and sold for scrap.
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