HHS: Bailing out Obamacare insurers an 'obligation' of the federal government

Washtington Examiner ^ | 20 Nov 15 | Philip Klein

[SkyPilot]

The Department of Health and Human Services attempted to reassure private insurers on Thursday that they'll be able to recover losses from participating in Obamacare by claiming it was an "obligation" of the U.S. government to bail them out.

At issue is a provision within the law known as the risk corridors program. Under the program, which runs from 2014 through 2016, the federal government is to collect money from health insurers doing better than expected and use those funds to provide a federal backstop to other insurers who incur larger than expected losses from rising medical claims. The idea was to provide training wheels to insurers in the first years of Obamacare's implementation, and to take away any incentive for insurers to cherry pick only the healthiest customers.

Republicans, fearing that this could turn into an open-ended government bailout in the event of industry-wide losses, included a provision in last year's spending bill that limited the program, requiring HHS to pay out only from the pool of money collected, rather than supplementing it with other sources of government funding. President Obama signed that bill.

Now that insurers have been able to look at medical claims, what they've found is that enrollees in Obamacare are disproportionately sicker, and losses are piling up. For the 2014 benefit year, insurers losing more than expected asked for $2.87 billion in government payments through the risk corridors program, but HHS only collected $362 million from insurers performing better than expected. Thus, the funds available to the federal government only amounts to 12.6 percent of what insurers argue that they're owed. So insurers are not happy.

[bert]

OK..... I can buy that line of reasoning and certainly won t argue against it. r

[Deo volente]

Great post, but when is FR going to get rid of all those annoying and distracting “ symbols?

Many of the posts on this forum are virtually unreadable.

[Lumper20]

Your memory is correct. For my business clients I had different group insurance plans/ insurers who had differing numbers of employees required for GI ( guarantee issue). As you also may recall the type of business also determined premiums/bids as white collar office types have less risk for injury then construction etc. I seem to recall that 25 employees was about the lowest with a few 10-15 person groups. As you are aware it depended on the insurer. I even had a medicare supplement in 85-6 that covered pre existing cancer after 90 days. I found that for my father who died in 86.

[SkyPilot]

If this is not the very essence of communism, what is?

Yup. The same line of reasoning that the "rich" should pay more in taxes, those who have should pay for those who didn't save, those who work should pay for those who have never held a job, those who sacrificed to raise their children should pay for those who have bastard child after bastard child, those who actual pay college tuition bills should pay for those who want a free ride, etc, etc.

[DH]

My suggestion for a compromise that would provide extra funding for Obamacare in the current budget is not to preserve it but to take the issue beyond the 2016 election.

---

You use the word COMPROMISE and that word is the bullet that killed our freedoms and liberties.

NO COMPROMISE ON ANYTHING....PERIOD! The GOPe has ruined our lives, futures and personal fortunes and opportunity by using that tactic.

The definition of Republican Compromise:

You have a bill that you want passed. 75% of the Democrats object to it. To bait them to vote for your bill you trim away enough of it so that only 49% will object to it. However, the bait is the heart of your bill and without it the bill you will get passed actually means nothing more than a blank piece of paper.

However, now you can claim that YOU wrote and passed a bill that the Democrats did not like while patting yourself on your back for COMPROMISING all good that the original bill had for seeking more votes for your upcoming election...or an amazing deposit into your coffers by strangers you did not even know.

The time has come for a NO COMPROMISE Republican House and Senate. The GOPe has already dealt our Constitution a death blow and it cannot take another.

[theBuckwheat]

There is no free market for a number of reasons:

1) government

2) government collusion with insurance companies

3) the structure of the market due to (1) and (2).

The solution is only found when the market is as free as possible.

[Rockingham]

In the imperfect world of politics, compromise and maneuver are often the only way to achieve an objective or to frustrate an adversary. Obama will almost certainly threaten a shutdown if the Obamacare funds are not provided, but he may well give up other programs rather than have Republicans dig in their heels and let a shutdown happen. My approach would delay the Obamacare financial crisis until after the 2016 election when we will have a Republican President and Congress and are in a stronger position to craft a final resolution that kills Obamacare permanently and sets up a successor program to address the issues bedeviling American healthcare on our terms.

[DH]

Here’s your problem: My approach would delay the Obamacare financial crisis until after the 2016 election when we will have a Republican President...

You ASSUME that we will have a Republican president. People who assume and place all of their bets on the table that they are positively going to win normally are broke after 1 play.

Some lessons are never learned. We ASSUMED during the last election when we gave the Republicans a majority in both houses that they would represent those who put them there and look what happened. We ASSUMED that the new Speaker of the House would be a true patriot and conservative and look what we got.

All of us who wasted our votes in the last election were raped by those we put into office with orders not to COMPROMISE ( since they were now the majority ) and “ right out of the gate “ they forgot they were in charge and immediately went back to their favorite “ back-stabbing “ favorite tactic...COMPROMISE.

We ASSUMED and all that we got was a mouth full of feathers.

[Rockingham]

It is not that I assume the GOP will win in 2016 as that I aim to assure that will be the case. Consider that Obama is the most potent figure that the Dems and the Left have. An all or nothing confrontation over Obamacare before the 2016 election gives Obama an issue to grandstand on and — with the news media's help — an opportunity to blame the GOP for Obamacare’s problems and to energize his adherents. I am hard put to imagine any rationale as to how triggering such a controversy in time for the 2016 election would help the GOP nominee.