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Articles on the implementation of ObamaCare.
On Tuesday UnitedHealth Group reported a terrific first quarter, with strong performance across nearly all business lines. There was one exception: The conglomerate’s insurance exchange unit raised its projected Affordable Care Act losses for 2016 to $650 million from $525 million, after booking $475 million in red ink last year.
CEO Stephen Hemsley said ObamaCare’s instability, small market size and costly patient population “continue to suggest we cannot broadly serve it on an effective and sustained basis.” He said UnitedHealth will withdraw to “only a handful of states” in 2017.
Normally sedate insurance markets have been roiled by everything from the federally chartered co-op failures to enrollment well below projections. ObamaCare’s architecture also makes it economically rational for consumers to wait until they are about to incur major medical expenses to get covered, and administratively created “special enrollment periods” encourage such gaming.
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United Healthcare’s announcement that it is pulling out of most of the exchanges established by the Affordable Care Act is one of many indications of the law’s continuing instability.
There are many other insurance plans in the same boat. Blue Cross Blue Shield plans have dominated the individual and small-group markets in most states for decades. If they were to abandon this market, they would have less ability than United does to grow their business elsewhere. But many of these plans are nonetheless contemplating such a move.
ObamaCare isn’t likely to enter an insurance death spiral; there’s too much federal money propping the whole thing up. But it isn’t on track to become a stable, self-sustaining insurance pool either, because very few middle-class families want to get their insurance through the exchanges. Which means the law is not only unstable financially, it is politically unstable as well.
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UnitedHealth is withdrawing from most of the 34 ObamaCare Exchanges in which it currently sells, citing losses of $650 million in 2016. A recent Kaiser Family Foundation report indicates UnitedHealth’s departure will leave consumers on Oklahoma’s Exchange with only one choice of insurance carriers.
Michael Cannon of the Cato Institute explains five results of UnitedHealth’s withdrawal from the exchanges:
1. UnitedHealth’s departure shows ObamaCare is suffering from self-induced adverse selection.
2. UnitedHealth’s departure is bad news for other carriers.
3. UnitedHealth’s departure shows ObamaCare premiums will continue to rise.
4. There will be more exits.
5. UnitedHealth’s departure shows quality of coverage under ObamaCare will continue to fall.
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The Medicare Advantage Value-Based Insurance Design Model kicks off Jan. 1, 2017 and will run for five years.
Value-based insurance design, or VBID, refers to health plans that waive or lower out-of-pocket costs for healthcare and prescription drugs that are proven effective for patients with chronic health conditions.
The CMS wants feedback on ways to promote quality of care and reduce cost of care for enrollees in the Medicare Advantage program.
The Food and Drug Administration said this month that it will delay enforcement of menu labeling rules – again – until next year. Passed as part of the health care overhaul in 2010, the rules will eventually require restaurants and other establishments that sell prepared foods and have 20 or more locations to post the calorie content of food “clearly and conspicuously” on their menus, menu boards and displays.
The Centers for Medicare and Medicaid Services released a white paper detailing the Centers for Medicare and Medicaid’s risk adjustment model Thursday.
“CMS has implemented a risk adjustment program to mitigate the effects of risk selection on health insurance premiums for non-grandfathered plans in the individual and small group markets,” the paper concludes. “The risk adjustment program, supports market stability by pooling risk and transferring funds from plans with more low-risk (i.e., healthier and lower cost) enrollees to those plans with more high-risk (i.e., less healthy and higher cost) enrollees.”
The paper also suggests potential modifications for the 2018 and 2019 benefit years.
The Congressional Budget Office reduced the projected number of people who will enroll on the federal insurance exchanges to 12 million from 21 million in a report released Thursday.
Still, between 2017 and 2026, the CBO projects the number of insured people in the U.S. will grow from 246 million to 253 million. While the number of uninsured is expected to grow from 26 million to 28 million, the portion of uninsured people younger than 65 is expected to stay around 10 percent, according to the report.
When I first answered God’s call to join the Little Sisters of the Poor and vow myself to Him and to the care of the elderly, I never dreamed of the happiness I would experience in serving, living with and caring for the aging poor until God calls them to Himself. I also never thought one day, I would be walking up the white marble steps of the Supreme Court to attend a legal proceeding in which the high court will decide whether the government can force my order to help offer health care services that violate my Catholic faith and that are already available through existing government exchanges.
A controversial federal health program that helps insurers withstand the ebbs and flows of the new insurance exchanges will be put under the microscope this week with the hope of making it fairer in the long term.
The CMS will host a public meeting Friday in which health insurers, state officials and others will offer their input on how to change the Affordable Care Act’s risk-adjustment methodology for 2018 and beyond. Under the permanent risk-adjustment program, which is a zero-sum game, the federal government redistributes money from plans that have lower-cost, healthier members to companies that have higher-cost, sicker members.