ObamaCare Post-Victory Lap Cooldown (2)

By Lambert Strether of Corrente.

Yesterday, we answered the first three of six questions:

  1. How Many Lives Will ObamaCare Save?
  2. What is the Actuarial Quality of the ObamaCare “Pool”?
  3. Will People Be Satisfied with Their Plans Once They Use Them?

Today, we’ll look at three more:

  1. What Will Happpen to Employer-Based Insurance?
  2. What About the Back End?
  3. What About Single Payer?

4. What Will Happpen to Employer-Based Insurance?

By way of context, let’s remember that the administration delayed, until 2015, the mandate that large employers offer insurance. (That is, for now, ObamaCare conceives of health insurance as a “shared responsibility” — the fines for mandate breakers are called “shared responsibility payments”[1] — between the federal government, state governments, insurers, employers, and individuals, except not employers.) However, we’re already seeing trial balloons for abolishing the employer mandate entirely:

Repealing the Affordable Care Act’s “employer mandate” would eliminate labor market distortions, cut opposition to the health law and leave only 200,000 more Americans without health insurance, according to new research by the Urban Institute, a left-leaning think tank.

Sucks to be one of those 200,000, though; ObamaCare is full of these decisions about who to throw under the bus, and who not, as opposed to single payer, with its “Everybody in, nobody out” philosophy.

The mandate requires large businesses with 100 or more workers to provide affordable health insurance for full-time workers or face a penalty of $2,000 per employee beginning in 2015. New rules allow these employers to cover only 70 percent of eligible employees in 2015 and 95 percent in 2016 and beyond.

Employers with 50 to 99 workers have until 2016 to comply with the mandate or face similar penalties.

The ACA originally called for the penalties to begin in 2014, but the Obama administration delayed their enforcement after complaints from business groups.

But researchers at the Urban Institute’s Health Policy Center estimate that most employers wouldn’t drop coverage if the penalties were eliminated, in part, because of the tax benefits. They estimate that 500,000 would lose employer coverage after the mandate is repealed. That’s a decline of just 0.3 percent.

Medicaid and other forms of coverage would pick up the slack, however, leaving roughly 200,000 people without coverage, an increase of just 0.6 percent. The non-partisan Congressional Budget Office estimates one million people would lose coverage if the employer mandate is eliminated.

Be that as it may, and contrary to what the “left-leaning” Urban Institute says, the insurance industry is already bubbling with innovative ideas about how to drop coverage.

First, employers could dump sick employees onto the Exchanges. Kaiser Health News:

Can corporations shift workers with high medical costs from the company health plan into online insurance exchanges created by the Affordable Care Act? Some employers are considering it, say benefits consultants.

“It’s all over the marketplace,” said Todd Yates, a managing partner at Hill, Chesson & Woody, a North Carolina benefits consulting firm. “Employers are inquiring about it and brokers and consultants are advocating for it.”

Here’s how it might work. The employer shrinks the hospital and doctor network [those narrow networks again!] to make the company plan unattractive to those with chronic illness. Or, the employer raises co-payments for drugs needed by the chronically ill, also rendering the plan unattractive and perhaps nudging high-cost workers to examine other options.

At the same time, the employer offers to buy the targeted worker a high-benefit “platinum” plan in the marketplaces. The plan could cost $6,000 or more a year for an individual. But that’s still far less than the $300,000 a year that, say, a hemophilia patient might cost the company.

The employer might also give the worker a raise to buy the policy directly. [In other words, convert from defined benefit to defined contribution except for health.]

The employer saves money. The employee gets better coverage. And the health law’s marketplace plan –required to accept all applicants at a fixed price during open enrollment periods — takes on the cost [and bad risk].

Moving high-cost workers to a marketplace plan would not trigger penalties under the health law as long as an employer offered an affordable companywide plan with minimum coverage, experts said. (Workers cannot use tax credits to help pay exchange-plan premiums in such a case, either.)

Then again, why not dump everybody?

A new investor report predicts that Standard & Poor’s 500 companies could shift 90 percent of their workforce from job-based health coverage to individual insurance sold on the nation’s marketplaces by 2020.

If all U.S. companies with 50 or more employees followed suit, they could collectively save $3.25 trillion through 2025, according to the report by S&P Capital IQ, a division of McGraw Hill Financial.

Standard & Poor’s 500 companies could save $689 billion over the same period if they did likewise, the report found. Savings for S&P 500 companies could top $800 billion if health care inflation remains at the traditional 7.5 percent rate over the next decade, the report estimates.

If realized, the larger move to marketplace coverage would shift more of the cost and responsibility for employee health insurance to workers themselves.

So, if the story is shift as much cost to the employee as possibly, what’s the point of having insurance companies? Why not shift the entire cost to the public as a whole, and pay for health care through taxes instead of premiums? What value are the insurance companies bringing to the transaction?

5. What About the Back End?

Readers will, I am sure, remember the hilariously bad ObamaCare rollout last October — and how nobody from the administration was ever held accountable for the disaster, from that day to this, because Obama. Readers will also remember that the administration brought in a “trauma team” to fix the front end but, for some unknown reason, not the back end.

Imagine your bank rolled out a whizzy new website; the initial rollout was a disaster, but the developers fixed it. However, the back end, which is the place where your data — in this case, your money — is stored after you press the Submit button on the front end, is still a disaster. Things that should be done electronically are done manually, things that are done electronically affect people’s accounts in random ways, reports are partial or non-existent, and nobody really has a clear picture of when the system will be fixed or even what’s wrong with it. Would you put your money in such a bank, if you knew what was going on? Well, that bank’s back end is ObamaCare’s back end. Sigh[3], Politico:

The Obamacare website may work for people buying insurance, but beneath the surface, HealthCare.gov is still missing massive, critical pieces — and the deadline for finishing them keeps slipping.

As a result, the system’s “back end” is a tangle of technical workarounds moving billions of taxpayer dollars and consumer-paid premiums between the government and insurers. The parts under construction are essential for key functions such as accurately paying insurers. The longer they lag, experts say, the likelier they’ll trigger accounting problems that could leave the public on the hook for higher premium subsidies or health care costs.

Without a fully built and operational system, federal officials can’t determine how many of the 8 million Obamacare sign-ups announced earlier this month will have actually paid their premiums. They won’t even know how many enrollment attempts were never completed. That, in turn, could affect the amount of money the government spends on premium subsidies. And once the system finally does all come online, the data delays could force a sharp revision in that celebrated 8 million figure.

The Obama administration posted a document earlier this month indicating that insurers will continue to be paid through an “interim” accounting process — pretty much a spreadsheet and some informed estimates — until at least September. When the permanent system eventually goes live, it could lead to a massive correction that either exposes taxpayers to more costs or puts pressure on insurance companies to raise prices.

“We have the mother of all reconciliations coming,” said insurance industry consultant Robert Laszewski, using the official term for the correction. “It may be that the administration will not be able to give us a credible enrollment number until then because we really need a reconciliation to accomplish that.”

“[A] spreadsheet and some informed estimates”?! Who do they think they are? Hedgies? (And we still don’t know what’s happening with those pesky 834s.) Moving on…

I’m not so concerned whether or not an industry that shouldn’t even exist extracts its rent. I’m more concerned with what happens to citizens; it sounds to me like you could pay your premium and take a trip to the hospital and find out you’re not covered because of a back-end screw up. Speaking of back-end screw-ups:

CHICAGO — Celeste Castillo, a Guatemalan immigrant, was invited to a news conference with Illinois Gov. Pat Quinn and Health and Human Services Secretary Kathleen Sebelius early last year to help promote enrollment in the country’s new health insurance marketplaces.

Fourteen months later [funny if not so sad], the 57-year-old nanny was still uninsured until The Associated Press contacted the Quinn administration last week. She had first become tangled in computer problems, then was denied by the state’s expanded Medicaid[3] program — underscoring how complicated the process has been for many Americans, even one held up as an example of who the law was designed to help.

“Every story is unique, but the theme that keeps coming up is how complicated this is,” said Jane Delgado, president of the National Alliance for Hispanic Health, a nonpartisan advocacy network.

Well, yes! As President Obama eloquently said: “What we’re also discovering is, you know, insurance is complicated to buy.” (Not single payer, of course.)

In addition, there are still both front- and back-end problems on the state level. Since California is held up as a model:

As they scrambled to open the insurance gates to millions of Californians under the federal health law, [Democratic] state officials prioritized the [2014- and 2016-critical] open-marketplace enrollment system over one for low-income residents, according to state documents and officials.

That decision significantly contributed to the backlog of about 900,000 applications to Medi-Cal, the state’s low-income health program.

More than three months later, many of the problems still have not been fixed. California now appears to have the largest backlog of Medicaid applications in the nation. Medi-Cal is California’s Medicaid program.

“There are people who can’t get their medications, people who can’t get to the doctor who need to,” said Elizabeth Landsberg, director of legislative advocacy for the Western Center on Law & Poverty. “This is people’s health at stake.”

Even after it rolled out, it was rife with glitches and programming errors. It was also missing components that Medi-Cal enrollment specialists had been told would be part of the package — and were part of Covered California’s site from the beginning, Mecca said.

Of course, with single payer, these 900,000 citizens would already be covered.

6. What About Single Payer?

First, there are primary candidates who support single payer: Don Berwick, running for Governor in MA; John Bohlinger, running for US Senate in MT; and Marcus Brandon, running for the US House in NC. And there are single payer bills in PA, OH, MN, MA, and MN, besides VT. So, single payer isn’t dead.

But I want to use this opportunity to bring forward another idea: We’ve long known that there is a single payer system on the very same continent as we are, in “Canada,” called “Medicare,” and that we’ve run the world’s largest controlled experiment to find out that Canada’s single payer system has health care outcomes just as good as ours, and costs a lot less money. What’s less well known is that Mexico has a universal health care system that is far closer to single payer than our own system is. WikiPedia:

Public Health care delivery is accomplished via an elaborate provisioning and delivery system instituted by the Mexican Federal Government. Public health care is provided to all Mexican citizens as guaranteed via Article 4 of the Constitution. Public care is either fully or partially subsidized by the federal government, depending on the person’s (Spanish: derechohabiente’s) employment status. All Mexican citizens are eligible for subsidized health care regardless of their work status via a system of health care facilities operating under the federal Secretariat of Health (formerly the Secretaria de Salubridad y Asistencia, or SSA) agency. [There are other systems for public and private employees.]

The government of the states in Mexico also provide health services independently of those services provided by the federal government programs. In most states, the state government has established free or subsidized healthcare to all their citizens.

Now, what I like about Canada is their rule that private entities can’t provide the services that public Medicare does. That means that the powerful have “skin in the game” — mi kidney machine es su kidney machine — and every incentive to keep Canadian Medicare funded and functional (even though the neo-liberals will still try to infest and destroy it, as they are doing in the UK). So I prefer Canada’s system to Mexico’s. Still, there are some useful points of comparison:

Mexican immigrants living in California, Arizona, Texas and New Mexico have long sought health care in border cities like Tijuana, Mexicali and Nogales. The Affordable Care Act won’t change that, experts said, even though it has expanded coverage to millions of people, including many Latinos.

Montalvo, 64, said she comes to Tijuana in part because it costs just $15 to see the doctor. She can’t use her insurance for care outside California but it’s still cheaper because she doesn’t have to worry about a deductible. More important, she said, is that she feels comfortable with Espinoza.

“Even with insurance, it can sometimes be cheaper in Mexico,” said Steven Wallace, who is associate director the UCLA center and has studied why Mexican immigrants seek care in Mexico.

The majority of these patients are Mexican immigrants with green cards or U.S. citizenship who can travel freely across the border. One 2009 study by Wallace found that nearly half a million Mexican immigrants living in California receive medical, dental or prescription services every year south of the border.

“To be honest, I like to come here better even if I have insurance,” she said. “Over there it’s wasting money and wasting time.”

The Obamacare plan, she said, is just for emergencies. For most everything else, Villanueva said she will continue driving the 70 miles to Tijuana. “It’s a long drive … but for me, it’s worth it,” she said.

Suggett said appointments typically last 30 minutes or more and the doctors don’t rely heavily on nurses or medical assistants – a contrast to often more rushed encounters in the United States. Physicians develop long-term relationships with their patients, who return again and again, often bringing family members along.

Xochitl Castaneda, director of the health initiative of the Americas at U.C. Berkeley’s School of Public Health, said Mexican clinics offer something not always found in the U.S. “In Spanish, we say calidad and calidez, quality and warmth,” she said. “When you are sick, you need medical support. You also need emotional support. That is something that Mexican physicians give.”

So, here perhaps we have one reason for ObamaCare’s low hispanic enrollment numbers (of concern to the administration because hispanics are a key voting bloc in 2014 and 2016): The Mexican system of universal health care is out-competing ObamaCare with those who have a choice between the two. Of course, some of this is cultural (calidad and calidez), and some of it is price; but note also the issues of high deductibles and “wasting time” (that is, the outcome of complexity), both of which are problems for ObamaCare, but not for single payer. Note also that in Mexico, you get a long-term relationship with an actual doctor, which you don’t get in the U.S. unless you can afford concierge medicine. Single payer would solve that directly, but some of the $400 billion (or more) a year we’d save by removing out the health insurance tapeworms from our systems could surely be put to improving the quality of patient care.

* * *

So that’s my best guess as to the important ObamaCare narratives through election 2016. It’s kinda amazing that the Democratic nomenklatura managed to get the press to let them declare victory on the basis of 8 million signed up, without any knowledge of how the program is working in real life for real people — could there be a reason why ObamaCare polls so badly, beyond Republican frothing and stamping? — or any comparison to other programs in other countries, but, getting personal here, I think most of these clowns travel up to Harvard and down to K Street on the Acela, have their generous policies paid for, and don’t have to think much beyond the packet their manager handed them. I know I didn’t, when I rode the Acela. Sorry for the class warfare, but there it is.


[1] In a more sane system — say, single payer — the shared responsibility citizens have for each other would be expressed in the normal way, by paying taxes. But n-o-o-o-o-o!

[2] I hate to quote Politico, but they are the ones who wrote the post. You’d think “left” leaning blogs with technical savvy like TPM or Think Progress would be all over this story, since after all these problems affect the mass of people they are sworn to defend, besides being an IT clusterfuck of epic proportions, so I can’t imagine why they don’t. Unless they’re Democratic house organs.

[3] So, since she’s 55+, any costs she incurs under Medicaid could be clawed back from her estate.

See Part 1.

Appendix 1: Enrollment Figures

[This will be a table drawn from the 2010 CBO report and updated with current figures for comparison, but that took longer than I expected and it’s now 4AM, which is the hour of Chernobyl and TMI, so I will add later this morning. Sorry!]

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About Lambert Strether

Readers, I have had a correspondent characterize my views as realistic cynical. Let me briefly explain them. I believe in universal programs that provide concrete material benefits, especially to the working class. Medicare for All is the prime example, but tuition-free college and a Post Office Bank also fall under this heading. So do a Jobs Guarantee and a Debt Jubilee. Clearly, neither liberal Democrats nor conservative Republicans can deliver on such programs, because the two are different flavors of neoliberalism (“Because markets”). I don’t much care about the “ism” that delivers the benefits, although whichever one does have to put common humanity first, as opposed to markets. Could be a second FDR saving capitalism, democratic socialism leashing and collaring it, or communism razing it. I don’t much care, as long as the benefits are delivered. To me, the key issue — and this is why Medicare for All is always first with me — is the tens of thousands of excess “deaths from despair,” as described by the Case-Deaton study, and other recent studies. That enormous body count makes Medicare for All, at the very least, a moral and strategic imperative. And that level of suffering and organic damage makes the concerns of identity politics — even the worthy fight to help the refugees Bush, Obama, and Clinton’s wars created — bright shiny objects by comparison. Hence my frustration with the news flow — currently in my view the swirling intersection of two, separate Shock Doctrine campaigns, one by the Administration, and the other by out-of-power liberals and their allies in the State and in the press — a news flow that constantly forces me to focus on matters that I regard as of secondary importance to the excess deaths. What kind of political economy is it that halts or even reverses the increases in life expectancy that civilized societies have achieved? I am also very hopeful that the continuing destruction of both party establishments will open the space for voices supporting programs similar to those I have listed; let’s call such voices “the left.” Volatility creates opportunity, especially if the Democrat establishment, which puts markets first and opposes all such programs, isn’t allowed to get back into the saddle. Eyes on the prize! I love the tactical level, and secretly love even the horse race, since I’ve been blogging about it daily for fourteen years, but everything I write has this perspective at the back of it.


  1. trish

    What value are the insurance companies bringing to the transaction? ha…the irrelevance.
    since obama hustled single payer off the table shortly after his election, it’s ask not what insurance companies can do for us but what we can do for the insurance companies.
    And the same for Big Pharma, any of the corporate elite. single payer does not work for that. as Dean Baker has hammered again and again to an unlistening majority (as you, Lambert, have hammered to an unlistening majority), our health care system is by far the most expensive in the world, doctors are payed far more than European countries and far far far more than Mexico (our “free trade” agreements have left our manufacturing workers high and dry but protectionist for docs), and patent monopolies keep our prescription drugs obscenely high. upward redistribution onward.
    nice to know single payer is alive here, but the forces against it…

    1. roadrider

      Well Dean Baker also shills for Obummercare based on the ludicrous argument that people will now be able to quit their jobs because they can buy grossly overpriced junk insurance that will cost them thousands of dollars every year just to use (deductibles, co-pays, co-insurance) even after they’ve paid thousands in premiums.

    2. jrs

      If it’s the end of employer provided health care it really is the worst of all worlds, no employer subsidy (I’m sure they’ll increase our wages to make up for it – haha) AND no bargaining power whatsoever with the insurance companies since we’ll all be buying individually. But of course we still have to deal with the insurance companies.

      But dropping the employer mandate makes it the PERFECT HEALTH INSURANCE plan for business. Insurance companies don’t lose any business and employers get out of a cost they don’t have to pay in any other country since they are no longer paying for health care. It just kind of sucks if your a person of the non-corporate variety.

    3. fan

      As an aside, when was Acela an elite form of transport? It’s Amtrak, albeit the only line run on a first world basis…

      About the powers that be being clueless, ditto that. Can you imagine the shocking faux paus of a K-street type lunching with a medium level bureacrat from early 20th Century France/Germany/UK?

  2. ScottW

    It is impossible to be an informed consumer when buying private health insurance, be it through the exchange, or open market. It is humanly impossible to understand the networks, prescription coverage, deductibles, co-pays, etc., etc. We all are flying blind, hoping we never have to tap into this fool’s gold product. And simultaneously, insurance companies are dreaming up even better ways to screw the public by providing less and charging more. No one on the insurance end cares about delivering better healthcare.

    It is all a disgrace and immoral.

    1. MaroonBulldog

      My lifelong employer is kicking us Medicare-eligible retirees out of its employee medical plan next year, but it hired a private exchange manager to help guide us seniors in selecting among those private individual Medicare Supplement and Part D, or group Medicare Advantage, plans whose premiums it will partially reimburse through its new defined contribution approach. I am still waiting for the packet of “educational” materials that will allegedly help me “understand” all my new choices and changed financial circumstances–so far, nada. Many other large corporations have already done similar things.
      When they can this to retirees, can the active employees be far behind?

      1. quixote

        I just read somewhere (LATimes? some major news outlet) that it is *illegal* for employers to slough people off to Medicare, and that they have to pay a hefty fine if they do. If I understood right, they can “encourage” workers to move to Medicare, by giving them information for instance, but they can’t actually make you move.


        Anybody else know anything about this?

  3. Jim Haygood

    ‘Insurers will continue to be paid through an “interim” accounting process — pretty much a spreadsheet and some informed estimates — until at least September.’

    Is this even legal? Of course not. But in our post-rule of law, l’état, c’est moi regime, anything goes.

  4. Splashoil

    Concurrent with the Obamacare rollout, the “trade” agreements are a major initiative of the Obama cabinet. TISA’s, trade in services agreements may well close off public implementation of single payer since the newly bloated private insurance industry must be compensated for loss of profits. This has largely stayed off the radar. Stay tuned.

  5. Pat

    Regarding point 4., please do not forget the Cadillac Tax. Obamacare has ALWAYS been a back door method of eliminating employer provided health insurance in America. And the Cadillac Tax was always meant to guarantee that ALL employers drop it within a decade. See any tax benefits of providing insurance to employees disappears eventually and it becomes a liability (that is the reason the level is determined by inflation NOT average rate of premium increase and certainly not the benefits offered). Without a mandate there is no reason to provide health insurance and much incentive not to do so. Even for employers who care about their employees and their health eventually the cost of that care will far out weigh what they can do. How this will effect union plans, places where employees have chosen for use to take their wage increases in health benefits will play out in a myriad ways, but the most likely being essentially a government endorsed theft of wages AND a massive wage cut, since in losing those benefits, the percentage of wages that went to pay for those benefits is lost AND they will need to lay out their own funds on the exchanges for policies that are probably less comprehensive and have more expensive out of pockets. Please not there is nothing making it mandatory that the percentages dedicated to health care be immediately added back to wages when companies choose to stop providing health insurance – so companies can give the employees a little something to help them buy those exchange plans, or even nothing at all, and keep the rest.

    I won’t get into all the reasons that I do not see single payer happening anytime soon and by soon I mean in the next two decades. It is just naive to think it will as hugely powerful forces CANNOT let that happen. I’m sure little Vermont is going to get the ratfucking of its life soon.

    If there is a god or goddess, Obama will be considered a blight on America before I die and his greatest “legacy” will be that the massive sellout of the American People his administration over saw provided the impetus for the destruction of the DLC infected Democratic Party for the good of the country. And Obamacare will be one of the big reasons why.

    1. Jess

      “If there is a god or goddess, Obama will be considered a blight on America before I die and his greatest “legacy” will be that the massive sellout of the American People his administration over saw provided the impetus for the destruction of the DLC infected Democratic Party for the good of the country.”

      I, too, hope to live to see this day come.

  6. RUKidding

    File under FWIW, but I live part time in San Diego. I know many people there who go to Mexico for their health care needs because it’s far cheaper AND reliable. Some are US citizens originally born in Mexico; others are just average US citizens of various ethnicities.

    The travel south of the border for health care slowed down considerably a few years ago when the drug cartels were stone-cold killing people in Tiajuana. For better or worse, somehow that’s been suppressed and is not happening so much anymore. And hence, the travel across the border for decent, affordable, reliable health care (including dental & vision) has resumed.

    As indicated in the article, typically US “health” insurance won’t pay a dime towards these services, but the users of such Mexican services say: so what? Still cheaper than doing it in the USA.

    Perhaps this highlights one reason to live/retire in a border town? Bc I am of the ilk who thinks so-called “health” care is only going to deteriorate and get much much worse before it ever gets better (if that’s even feasible, even many decades from now).

    Good luck to us all.

  7. jerry denim

    I’m writing this from the reception area of a Dermatologist office, I just signed in for my first visit. Here was my exchange with the receptionist.

    ME: “You guys accept Blue Cross Blue Shield right?”

    RECEPTIONIST: ” Yeah, as long as its not part of anything offered through the affordable care act.”

    ME: ” No, it’s not thankfully. So you don’t accept anything through the affordable care act? Wow, a lot of good that stuff is…”

    RECEPTIONIST: ” Yeah, I know. I feel so bad for those people.”

  8. impermanence

    Hate to keep beating a dead horse [acknowledging that a single-payer system is the best way to keep the rent-seekers at bay], but the only solution is this problem is a prevention-based system where individuals take nearly full responsibility for their own health/care.

    The notion that the corporate/state [or any other institution] can save us must be put out of its misery once and for all. As should be fairly obvious, institutions works for the very few who [essentially] own them.

    1. hunkerdown

      Absolutely, death to institutions and long live *public services*. You do see behind that 19th-century American Exceptionalist religion that there is a difference, right? That institutions see their own survival as a supreme interest and that services see service provision as their supreme interest.

      So, please, your money-dreidels are neither interesting nor useful except as a means of pretending you’re better than anyone else, which is what America is apparently all about, and I’m not interested in endorsing your affectation. Thanks anyway.

  9. jrs

    “Repealing the Affordable Care Act’s “employer mandate” would eliminate labor market distortions …. and leave only 200,000 more Americans without health insurance”

    Ok they can’t both be true. If this only affects 200,000 employees how can it really have much of a distortion on the labor market?

    1. hunkerdown

      There are people who are employed for reasons that don’t fall within the popular arbeit-macht-leben narrative of the employer-employee relationship and are less manageable as a result. I once worked with a guy who, having a home business, took on employment only for the insurance and was indifferent to the wages, not that a plastics process tech makes that great a wage in the rust belt anyway. He may be one of the 200k, if he hasn’t moved abroad since I last saw him 6 years ago.

      This set of interests seems to be operative in at least this case; surely there are others.

  10. CrisisMaven

    “Can corporations shift workers with high medical costs from the company health plan into online insurance exchanges created by the Affordable Care Act” … this is why ACA will be actuarially untenable: it will lead to even more segregation of risks. Health (and any other) insurance is about mixing risks in the largest possible cohorts. The idea of the Affor-dabble Care Act though is to establish insurance policies that are fractionated across state boundaries, several tiers (basic to platinum) and sliced and diced in many more ways than I ever thought imaginable. Since many if not most of these policies will never reach critical mass, they will eventually have to be either closed or their premiums elevated to levels that makes every member flee the plan. In the end, everyone will be a lot poorer, insurance companies on the verge of bankruptcy and the state will have to bail everyone out and enlarge the entitlement programs even more.

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