Detailed Obamacare Blue Cross Enrollment--About Half the Enrollment Doesn't Get a Subsidy!

About half of those buying Obamacare compliant individual health plans do not receive a subsidy.

I was struck by this comment coming from one of Obamacare's most vocal supporters, Vox's Sarah Kliff:

Obamacare's insurance expansion is on the path to looking like other safety net programs we know, offering limited services to a predominantly low-income population.

She might be right about Obamacare devolving into a low-income style safety net program. But she couldn't be more wrong about the people who have no choice but to buy Obamacare if they want health insurance.

In the September 2016 issue of the trade publication, The AIS Report on Blue Cross and Blue Shield Plans, reporter Steve Davis did something no other reporter I know of has done. He called a number of Blue Cross plans and asked how many of their Obamacare individual health insurance policyholders get a subsidy and how many do not. His report covers 26 state Blues plans.

Big Obamacare Rate Increases Don't Reflect What People Actually Pay––Wrong!

How many people in the individual health insurance market don't get a subsidy to pay for their health insurance, or wouldn't be eligible for one it they did buy it?

Here is what an Obama administration spokesperson said yesterday about all of the big 2017 Obamacare rate increases: "Headline rate increases do not reflect what consumers actually pay," said Kathryn Martin, acting assistant secretary for planning and evaluation at the Department of Health and Human Services.

What she is once again referring to is that 85% of those getting subsidies could get their rate increases eliminated or blunted by the subsidies. It is worth pointing out that the consumer only avoids the big increase if they are in, or move to, the lowest or second lowest cost Silver Plan.

Staying with a higher priced plan they might now be in will not avoid the increases.

And, once again, the administration doesn't tell us that moving to a lower price plan may require higher deductibles and co-pays and more limited provider networks.

But more importantly, why does this administration, and so many Obamacare supporters that parrot this line, continue to ignore the many millions of people who do not get a subsidy and have no choice but to take the full whack from these rate increases if they want to stay covered?

"The Blues Have Deep Reserves and They'll Be Here Long After We're Gone"--Here's How It Really Works

The denials about just how bad the Obmacare exchange situation is keep piling up.

Maybe the most uniformed and naive was this comment in the Dallas Morning News:

"The Blues have deep, deep reserves, and they'll be here long after we're gone,"[Sabrina] Collette [a research professor at Georgetown University], said. "They're probably calculating they can ride out this rocky time and emerge with a dominant position."

In the same article it was reported that local Dallas HMO Scott and While Health Plan is withdrawing from the exchanges. The article also pointed out that Texas Blue Cross has lost more than $1 billion on the exchanges over the last two years and is now seeking a rate increase of 60% for 2017.

These Blue Cross plans, particularly the community-based not-for-profits like Texas, do not have a bottomless bank account.

Latest Proposals to Fix Obamacare Come Up Way Short--The Insurance Industry Trade Association Joins the List of Deniers

In my last couple of posts, I have lamented the degree to which prominent Obamacare supporters have been denial about the trouble The Affordable Care Act exchanges are in. Now we can add the insurance industry trade association, AHIP, to the list.

With the Obamacare exchange exits by the publicly traded health plans, the not-for-profit Blue Cross and regional HMOs now form the backbone of the Obamacare exchanges. I am not predicting any imminent exits on their part, but another year will be a different story if this isn't fixed. If you look at the size of their statutory surplus accounts and their staggering ongoing losses in the face of reports the risk pool continues to deteriorate, it's a simple exercise in math so see what's coming.

The clock is just plain ticking on the time left to fix Obamacare.

Obamacare on Life Support?

My comments on CNBC today.

"Those Whining Obamacare Insurers"

Affordable Care Act defenders need to understand that if we don't quickly move on to a robust conversation about how to fundamentally make the individual health insurance market viable many of the remaining often not-for-profit plans will have to walk away from the Obamacare exchanges.

See my post at Forbes

Obamacare Is Failing. And There Is Only One Way To Fix It

See my op-ed at CNBC

And my earlier post on the steps necessary to make Obamacare viable

According to Aetna We Have Two Kinds of Insurance Companies Under Obamacare: The "Less Worse Off" and the "Worse Worse Off"

Surviving Co-Ops Sue Feds Over Inadequate Obamacare Reinsurance Payments While Aetna Complains the Payments Aren't Enough For Their Only "Less Worse Off" Financial Results

I don't know if you noticed the recent juxtaposition between the surviving co-ops complaint that they shouldn't have to pay the big legacy carriers money under the Obamacare "3Rs" reinsurance scheme with Aetna's complaint this week that these same payments aren't enough for them to be confident they will continue in the exchanges.

Obamacare's 2017 California Rates to Increase an Average of 13% With the Biggest Players Going Up 17.2% and 19.9%

After last year's 4% rate increase, California's Obamacare insurance exchange rates appear to be catching up to the rest of the country.

The two biggest carriers are raising rates by much more than the average 13.2% increase. Blue Shield said its average increase was 19.9% and Anthem said it would increase rates an average of 17.2%

According to the LA Times, Covered California officials blamed the big increase on the "rising costs of medical care, including specialty drugs, and the end of the mechanism that held down rates for the first three years of Obamacare."

Well, once again when it comes to Covered California's explanations, not exactly.

On the argument blaming the rising cost of care, in late May Milliman published its Milliman Medical Index indicating that baseline medical cost trend was up 4.7% year-over-year––the lowest annual increase since Milliman first measured cost trend in 2001. And, of course, this 4.7% increase included the cost of specialty drug costs.

Everything Will Be Fine As Soon As The Obamacare Market "Stabilizes"––Not

North Carolina Family Plans Already Cost More Than $10,000 a Year With Rates Going Up By Double Digits for 2017

With one state after another announcing big 2017 Obamacare rate increases the latest refrain from Obamacare supporters is that with maybe one or two more years of rate increases everything will be fine.

Talk about missing the forest for the trees.

The latest example is in North Carolina where market leader Blue Cross, the biggest insurer with 330,000 people covered, is asking for an 18.8% 2017 rate increase. Aetna, with 130,000 customers is asking for 24.5%.
See My Post at Forbes
 

New York's 2015, 2016 and 2017 Obamacare Rate Increases

New York just announced the 2017 requested rate increases for individual health insurance.

I thought the history of New York's increases was interesting.

Why Are Centene and Molina the Exception To Most Big Health Plan Losses On the Obamacare Exchanges?

This paragraph in a recent AP story caught my eye:

Two companies that report exchange success so far, Molina Healthcare Inc. and Centene Corp., say they have focused on covering low-income customers in markets where they already have an established presence in Medicaid, the state-federal program that covers the poor. Molina sells coverage in nine states and is thinking about adding two for next year.

Why are these traditionally Medicaid carriers doing so well when most of the health plan market is losing their shirts in the Obamacare exchanges?

See my post at Forbes. 

"Figures Don't Lie But Liars Figure": The Disingenuous Obama Administration's Report That Claims Obamacare's Average Premiums Rose by Only 8% in 2015

The Obama administration is out with a report that the average 2015 Obamacare exchange premium increased by only 8% last year.

As best I can tell, that is a true statement.

It is also an incredibly disingenuous statement.

United Healthcare Leaving the Obamacare Exchanges Is Not the Point––What's Happening to the People Who Have No Choice But to Buy Their Health Insurance Under Obamacare Is

Comments in a recent Politico article over United HealthCare's pullout from the Obamacare exchanges because of $1 billion in losses have me scratching my head.

"It's a nothingburger in terms of market impact, said insurance industry consultant John Gorman. But symbolically and politically, it's huge" He went on, "We're only about halfway through the drama of stabilizing these marketplaces. We've got another two or three years to go, and it's going to be a bloody two or three years."

Selling Health Insurance Across State Lines––A Really Dumb Idea

Any candidate that suggests such a scheme only shows how unsophisticated he and his advisers are when it comes to understanding how the insurance markets really work––or could work.

I gave a speech to 750 health insurance brokers and consultants in DC last week.

When selling health insurance across state lines, something Trump and a number of other Republican presidential candidates have been pushing, was mentioned the audience literally laughed. That's what health insurance professionals who spend their days in the market think of it!

This is about as dumb an insurance "reform" idea as has ever been proposed.

John Kasich's Ohio Health Care Record: Making Lemons Into Lemonade

It's easy to be critical of Obamacare.

But from the time The Affordable Care Act was passed until a new President and Congress have a chance to change things in 2017, America's governors haven't had the luxury of just complaining about it. They have had to govern.

Governor Kasich and his team have made big health care change a reality by collaborating with the key stakeholders in Ohio. On that score they have made lots of Obamacare lemons into lemonade.

Read my op-ed today at the National Review.

And, my post last fall at Forbes regarding Kasich's Medicaid expansion in Ohio. 

Obamacare Hits 12.7 Million Enrollments––But Only Grows 8.5%

Today the administration announced that 12.7 million people signed up for coverage in the Affordable Care Act's insurance exchanges.

Said the HealthCare.gov CEO, "We knocked the lights out this year. We did a great job."

Let's take a closer look.

Why the Obamacare 2016 Open Enrollment Stalled: The Big Unwritten Story About Obamacare––How Unaffordable It Is For the Working and Middle Class

Back on December 22nd when the President triumphantly announced 6 million enrollments on HealthCare.gov and the administration pointed to "unprecedented demand" on the exchanges, I was the skunk at the garden party arguing in the Washington Post that it was all just churn as existing customers were only trying to escape all of the big rate increases.

Well guess what? It was all churn.

The administration will shortly announce the total number of people who signed up for Obamacare under the Affordable Care Act.

The number signing up in 2016 will turn out to be not much more than the number who signed up last year after those who don't pay are netted out––no sizeable gain in enrollment has been accomplished on a national basis. [February 4 Update: The increase was 8.5% over 2015.]

2016 Obamacare Outlook

One of the more Obamacare fluent reporters just emailed me a set of questions regarding the 2016 outlook for Obamacare.

I thought I would share my responses with you:

UnitedHealth Group Losing Big Money and Threatening to Leave the Obamacare Exchanges--Because the Obamacare Insurance Business Model Does Not Work

It's official. The Obamacare insurance company business model does not work.

UnitedHealth Group just announced they expect to lose $700 million in the Obamacare exchanges and are seriously considering withdrawing from the program in the coming year.

This morning, the Wall Street Journal reported just about everybody else is losing their shirts in Obamacare as well:

Several other big publicly traded insurers also flagged problems with their exchange business in their third-quarter earnings Anthem Inc. said enrollment is less than expected, though it is making a profit. Aetna Inc. said it expects to lose money on its exchange business this year, but hopes to improve the result in 2016. Humana Inc. and Cigna Corp. also flagged challenges...

There are signs that broad pattern has continued--and in some cases worsened--this year. A Goldman Sachs Group Inc. analysis of state filings for 30 not-for-profit Blue Cross and Blue Shield insurers found that their overall company wide results were "barely break-even" for the first half of 2015.

Goldman analysts projected the group would post an aggregate loss for the full year--the first since the late 1980s. The analysis said the health-law exchanges appeared to be a "key driver" for the faltering corporate results, and the medical-loss ratio for the Blue insurers' individual business was 99% in the first half of 2015--up from 91% at that point in 2014, and 82% for the first six months of 2013.

Every health plan I talk to tells me that they don't expect their Obamacare business to be profitable even in 2016 after their big rate increases. That does not bode well for the rate increases we can expect to be announced in the middle of next year's elections.