Sound fiscal policy is essential for sound governance. History shows that powerful nations that engage in reckless spending and borrowing eventually fall into periods of decline. It would be disastrous if the United States were to drift into such a slide.
What’s needed are fundamental reforms that will change the direction of key programs in ways that will last for decades. This kind of project will take many years to achieve, and some very important policy changes are likely to require lengthy transition provisions to reassure voters who are accustomed to current arrangements. But the current welfare state wasn’t built in a day, and changing its orientation is going to require persistence and patience.
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When President Obama described the Affordable Care Act’s health-insurance exchanges in late 2013, he declared they would create “more choice, more competition, [and] real health-care security” for millions of Americans. This hasn’t panned out. Nearly three years later, choice and competition have declined, a problem that is already set to worsen in 2017.
UnitedHealth Group is the latest proof. On April 19, the company announced that it will abandon the exchanges in all but a “handful” of the 34 states in which it currently operates. This could leave up to 6 percent of the Affordable Care Act’s subscribers scrambling for new plans before year’s end.
With the recent announcement that UnitedHealth is withdrawing from most ACA Exchange markets – after losing $1 billion in only two years – and that the withdrawal potentially leaves almost 30% of enrollees with only one or two insurance companies to choose from, this failure may be evident sooner than we realize.
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The last thing Democrats want to contend with just a week before the 2016 presidential election is an outcry over double-digit insurance hikes as millions of Americans begin signing up for Obamacare. But that looks increasingly likely as health plans socked by Obamacare losses look to regain their financial footing by raising rates.
Just a week after the nation’s largest insurer, UnitedHealth Group, pulled out of most Obamacare exchanges because it anticipates $650 million in losses this year, Aetna’s CEO said Thursday that his company expects to break even, but legislative fixes are needed to make the marketplace sustainable.
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House Ways and Means Committee Chairman Kevin Brady (R-Texas) said Friday that House Republicans would unveil their ObamaCare replacement plan sometime in the next 45 days.
“The task force is working on it,” Brady said at a Bloomberg Government event. “We’ll be laying that out here over the next month and a half.”
Republicans have said that they plan to have Speaker Paul Ryan’s (R-Wis.) policy task forces lay out their plans before the Republican National Convention in July.
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When UnitedHealth, the nation’s largest health insurer, announced earlier this month that it would exit the Affordable Care Act exchange business in all but three states, the obvious question was, who’s next? After all, if the nation’s biggest health carrier can’t make the Obamacare exchanges profitable, who can? UnitedHealth announced it expects to lose $650 million on its ACA business in 2016, although its first-quarter earnings beat analyst expectations, thanks to the company’s highly profitable consulting and technology businesses.
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For years, voters in this swing state have rejected tax increases and efforts to expand government. But now they are flirting with a radical transformation: whether to abandon President Obama’s health care policy and instead create a new, taxpayer-financed public health system that guarantees coverage for everyone.
The estimated $38-billion-a-year proposal, which will go before Colorado voters in November, will test whether people have an appetite for a new system that goes further than the Affordable Care Act. That question is also in play in the Democratic presidential primaries.
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Key Findings:
Expect insurers to seek significant premium increases under President Barack Obama’s health care law, in a wave of state-level requests rippling across the country ahead of the political conventions this summer.
Insurers say the law’s coverage has been a financial drain for many of them, and they’re setting the stage for 2017 hikes that in some cases could reach well into the double digits.
For example in Virginia, a state that reports early, nine insurers returning to the HealthCare.gov marketplace are seeking average premium increases that range from 9.4 percent to 37.1 percent.
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The public’s views of the Affordable Care Act, which were evenly divided following the Supreme Court’s ruling last summer upholding a key section of the law, are again more negative than positive. Currently, 44% approve of the 2010 health care law, compared with 54% who disapprove of the law.
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