Tennessee taxpayers, beware. President Obama’s administration is quietly implementing one last massive taxpayer-funded bailout for special interests.
This bailout would prop up the Affordable Care Act only months before the law will likely be repealed.
So which special interests are getting your money? Health-insurance companies. Six years ago, health insurers were some of the Affordable Care Act’s biggest fans. They lobbied for the law because they thought it would be a financial windfall — it literally forces Tennesseans to buy their product.
But instead of finding gushers of cash, they’re drowning in red ink. Health insurers in Tennessee and across the country lost $3.2 billion in 2014 and over $10 billion in 2015. This year’s losses will be even higher.
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During 2015, the growth in both individual-market and employer-group coverage resulted in a net increase in private-market coverage of 2 million individuals. For individual-market policies, enrollment increased by a bit more than 1.12 million individuals. For the employer-group-coverage market, enrollment in fully insured plans declined by 932,000 individuals, while enrollment in self-insured plans increased by 1.86 million individuals. The net effect of those changes was an increase of 926,000 in the number of individuals with employer-sponsored coverage in 2015.
Public program enrollment in Medicaid and the Children’s Health Insurance Program (CHIP) increased by almost 2.77 million individuals in 2015. As in 2014, the change in Medicaid enrollment in 2015 differed notably between states that adopted the ACA’s Medicaid expansion and states that did not. States with the ACA’s Medicaid expansion in effect experienced Medicaid enrollment growth of almost 2.13 million people, while in the states without the expansion in effect, Medicaid enrollment grew by 640,000 individuals.
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Senate Majority Leader Mitch McConnell on Monday indicated that Republicans won’t be putting forth their alternative to the Affordable Care Act before repealing parts of the health care law.
“We’re going to move forward first, first with the Obamacare replacement resolution,” the Kentucky Republican said at a Capitol Hill press conference. “What comes next is what comes next.”
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One of the most frequently heard claims from the Obama administration is that Obamacare is responsible for insuring 20 million adults who were previously uninsured. But Heritage Foundation research shows the administration’s figure is off by a few million.
It is important to note that the administration’s coverage estimates are based on survey data rather than calculating the actual change in coverage in different markets. Though surveys can provide useful information, they are not as precise as using enrollment data taken directly from insurance companies.
A recent analysis by The Heritage Foundation’s Edmund Haislmaier and Drew Gonshorowski uses the more accurate method, taking actual enrollment data from Medicaid and private insurance companies to assess the impact Obamacare has had on coverage.
The researchers found that just over 14 million people gained coverage from the end of 2013 to the end of 2015. Of those 14 million, 11.8 million gained their insurance through Medicaid and 2.2 million through private coverage.
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The current situation presents an opportunity to replace the Affordable Care Act with a more sustainable bipartisan law. But repeal must wait until a consensus is built around a replacement plan. Not doing so – starting with repeal and delay – threatens to destabilize the individual market and harm not only those who receive subsidies from the ACA, but also everyone who now purchases insurance in the individual market.
Estimates show that premiums would jump at least 20 percent and cause 4.3 million to lose health insurance as soon as next year, and that’s nothing compared to the damage that would be inflicted if a replacement plan subsequently failed to emerge. The current version of repeal through reconciliation, leaving in place the ACA’s insurance market reforms, would nearly destroy the individual market if its provisions took effect, causing 30 million people in total to lose health insurance, leaving more uninsured than before the ACA.
Fixing the ACA is important, but replacing it with a durable plan to make health coverage broadly affordable will take time and constructive bipartisan collaboration.
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