The Post-Republican Obamacare Market Will Be "Stable" and Very Profitable for Health Insurers

Predictions that the individual health insurance market will now implode are misplaced.

First, in the wake of the Republican collapse of efforts to replace Obamacare, Medicaid will continue on unaffected. The Obama Medicaid expansion is fully funded for years to come. The nineteen states that did not take the expansion will continue to be on the outside looking in as their taxpayers continue to fund the expansion in the 31 states that did expand. And, health insurers will continue to enjoy that growth in their business as states continue to benefit from the open-ended federal funding.

The individual health insurance market will not collapse.

With about 3,000 counties in the U.S., I can't give you an absolute guarantee that there won't be a few that will not have an insurance carrier serving the Obamacare market in 2018. But generally, the vast majority of people eligible for subsidies will have at least one carrier to buy from.

The Kaiser Family Foundation is out with a recent study looking at medical loss ratios in the first quarter of 2017. They concluded that "individual market insurers on average are on a path toward regaining profitability in 2017."

I wouldn't go so far as to say that participating health plans will generally make money in 2017––the first quarter medical loss ratio is always better early on as consumers satisfy their ever-growing Obamacare deductibles.

But I do think 2018 could be a decent bottom line year for most Obamacare exchange insurers. And, 2019 should be just fine.

Does this mean the Obamacare insurance exchanges are working well?

No.