Another bombshell could soon drop on the Affordable Care Act insurance exchange market, and it might come at a highly vulnerable moment for ObamaCare.
Rosemary Collyer, U.S. District Judge for the District of Columbia, is expected to soon issue her ruling in U.S. House of Representatives v. Burwell, a case in which House Republicans claim the Obama administration is illegally funding the ACA’s cost-sharing subsidies without a congressional appropriation.
If, as some legal observers believe is possible or even likely, the George W. Bush-nominated Collyer decides against the administration, it would further rattle insurers who are facing multiple difficulties in the exchange business. UnitedHealth Group announced last week that it was pulling out of most exchanges because of its financial losses. Such a ruling would be a shock, even though it surely would be appealed, and the case could ultimately reach the Supreme Court.
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Here’s some bad news for the insurance industry: Unexpectedly generous corporate subsidies didn’t save companies selling ObamaCare policies from bleeding red ink. The worse news: Those subsidies are set to expire in 2017, meaning that insurers will have to make ends meet without billions in handouts.
Those are among the matters discussed in a study by the Mercatus Center, authored by Brian Blase, Edmund Haislmaier, and Doug Badger. Thestudy, based on detailed data derived from insurer regulatory filings for the 2014 benefit year, finds that companies that sold ObamaCare plans in the individual market lost more than $2.2 billion, despite receiving $6.7 billion (an average of $833 per enrollee) in “reinsurance” subsidies. Those reinsurance payments were 40 percent more generous on a per-enrollee basis than insurers had expected when they set their 2014 premiums.
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A Crain’s investigation shows how Health Republic, the insurance company that was supposed to be about people, not profits, misled its customers and ran itself into the ground.
It’s been decades since a New York health insurer has cratered so dramatically. Providers told Crain’s they signed contracts to treat Health Republic members because they assumed the insurer had been fully vetted by the state. The Cuomo administration had even issued press releases in 2014 and 2015 crediting DFS’ oversight as evidence of the state’s role in keeping premiums affordable.
“We feel betrayed,” said Robert Glazer, chief executive of ENT and Allergy Associates, a large medical practice with 173 physicians. The only warning signs of trouble were early last year, when Health Republic delayed claim payments by three to four months.
“We have no idea if our doctors will be reimbursed,” said Glazer, whose practice is owed more than $650,000. Even if money is recovered, Oechsner said payments to providers “would likely be modest at best.”
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Even before President Obama leaves office, ObamaCare has begun unraveling.
The law was passed over the objections of a majority of Americans, it is still opposed by a majority of Americans — and their opposition has been vindicated. Last week, UnitedHealth Group announced that, after estimated losses of more than $1 billion for 2015 and 2016 under ObamaCare, the company was pulling out of most of its ill-fated exchanges. In fact, commercial insurers across the country are hemorrhaging money on ObamaCare at alarming rates.
The president promised these insurers taxpayer bailouts if they lost money, but Congress in its wisdom passed legislation barring the use of taxpayer dollars to prop up the insurers. Without the bailouts, commercial insurers are being forced to eat their losses — while more than half of the ObamaCare nonprofit insurance cooperatives created under the law failed.
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The Mercatus Center at George Mason University released a new working paper on the Affordable Care Act. The study, authored by Brian Blase of the Mercatus Center, Doug Badger of the Galen Institute, and Ed Haislmaier of the Heritage Foundation contains two key findings:
First, insurers incurred substantial losses overall despite receiving much larger back-end subsidies per enrollee through the ACA’s reinsurance program than they expected when they set their premiums for 2014. Second, it is estimated that in the absence of the reinsurance program, insurers would have had to set premiums 26% higher, on average, in order to avoid losses—assuming implausibly that the overall health of the risk pool would not have worsened as a result of the higher premiums. The findings raise serious questions about the ACA’s future, particularly when the reinsurance program ends and premium revenue must be sufficient to cover expenses.
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President Barack Obama is calling on taxpayers to shell out more money for his health reform law’s disastrous Medicaid expansion.
The president recently asked Congress to approve $106 billion in new Medicaid spending over the next 10 years. Nevermind that the Congressional Budget Office just concluded that, as is, Medicaid spending will add $1.3 trillion to the federal deficit by 2025. That’s $136 billion more than the agency projected last year.
And it’s not as if those dollars are being spent wisely. Obamacare’s Medicaid expansion is sticking taxpayers with a huge bill while doing little to help low-income Americans actually gain access to high-quality healthcare.
The Affordable Care Act’s tax increases are many, two are front and center this month: the individual and employer mandates. They were both supposed to increase coverage, but in reality they’re limiting career opportunities and taking more out of families’ and individuals’ wallets.
The Affordable Care Act has created many problems and the American people are left with rising costs, and higher taxes, mountains of red tape, and arrogant bureaucratic attacks on personal and religious liberty.
When federal lawmakers wrote the act overhauling the nation’s health-care system six years ago, they ruled out any possibility of extending health insurance to illegal immigrants.
Local officials where many of those immigrants live are treating them anyway.
A Wall Street Journal survey of the 25 U.S. counties with the largest unauthorized immigrant populations found that 20 of them have programs that pay for the low-income uninsured to have doctor visits, shots, prescription drugs, lab tests and surgeries at local providers. The services usually are inexpensive or free to participants, who must prove they live in the county but are told their immigration status doesn’t matter.
The so-called “Cadillac Tax” is a 40 percent excise tax on the value of employer-sponsored health coverage that exceeds certain benefit thresholds, estimated to be approximately $10,800 for employee-only plans and $29,100 for family plans when the tax takes effect in 2020.
While the name may imply the tax applies to a few individuals with luxury health coverage, the truth is it extends much further. 175 million Americans – including retirees, low- and moderate-income families, public sector employees, small business owners and the selfemployed – currently depend on employer-sponsored health coverage and they are all at risk.
On behalf of the American Benefits Council, Public Opinion Strategies conducted a nationwide online survey of 1,200 registered voters from January 29 to February 3, 2016. These findings indicate that voter support for the “Cadillac Tax” is dwarfed by support for repeal.