November 3, 2015
To date, more than half a million Americans have lost coverage thanks to the failure of these co-ops. The reason? The co-ops took on far too many customers at artificially low premiums, and, as the American Enterprise Institute and the Galen Institute noted earlier this year, are drawing down “unspent loan funds to pay medical claims.”
Despite mounting failures, the Obama administration has been unwilling to change course. Politico Pro has reported that state and federal regulators let some of the co-ops “reclassify certain loans as surplus, a move that financial analysts say will make the health plans’ balance sheets look better and potentially keep them from shutting down.” In other words, to hide their debts and project false solvency—until they, too, go under.
Source: ObamaCare’s Cascading Co-op Failures – WSJ
October 29, 2015
In sum, of the 24 Obamacare co-ops funded with federal tax dollars, one (Vermont’s) never got approval to sell coverage, a second (CoOportunity) has already been wound down, and nine more will terminate at the end of this year.
Source: Why Obamacare Co-Ops Are Failing At A Rate Of Nearly 50% – Forbes
October 27, 2015
Quite candidly, anybody dumb enough to take the government money under these circumstances wasn’t going to be smart enough to pull it off.Let me also suggest that these struggling Obamacare co-ops are tantamount to the canaries in the Obamacare coal mine.These plans are exclusively in the business of the Obamacare insurance exchanges. If you want to segregate the Obamacare insurance business model from the overall insurance business to examine it, the co-ops are pure Obamacare.Just how well have all of the co-ops done?As the Washington Post recently reported, of the 23 Obamacare insurance co-ops in business on June 30, 2015, each of them charted in the article, 20 of them were losing money–most of these relatively tiny insurance start-ups showed staggering losses in the range of $4,000,000 to $50,000,000!
Source: Crocodile Tears Over The Failing Obamacare Co-Ops–The Canaries In The Obamacare Coal Mine – Forbes
April 1, 2015
Iowa’s co-op may be the first to implode, but it is not the only one facing insolvency. By the end of 2014, CMS had furnished approximately $2.5 billion in loans for co-ops. According to A.M. Best, an insurance rating firm, all but one co-op had reported operating losses in 2014.
If politicians have learned nothing else in the wake of ObamaCare and the government’s ill-conceived foray into the health insurance marketplace, they certainly know now that the health care sector is highly complex, that government is ill equipped to understand it, let alone manage the system. It is time for politicians and bureaucrats to stop interfering with health care.
via Public holds bill for health co-op’s collapse.
March 3, 2015
Even though it’s only the beginning of 2015, insurers are already starting to think about 2016 rate filings. Using 2014-2015 Health Insurance Marketplace data, we looked for correlations between silver plan premiums and variables like the number of carriers and plans in a rating area, available industry metrics, and the structure of provider networks in each rating area. We focused our analysis on the second-lowest silver plan offered in each market and discovered some interesting findings.
via 2015 health insurance marketplace competitiveness study – Milliman Insight.
February 28, 2015
Blue Cross and Blue Shield, the state’s largest health insurer, said Friday that it posted its first financial loss in 15 years as a result of insuring high numbers of older and sicker people under the Patient Protection and Affordable Care Act.
The Chapel Hill organization signed up 257,704 people under the federal health care law, which requires insurers to provide coverage regardless of a customer’s health condition.
New enrollees last year swelled Blue Cross’s covered membership to 3.91 million people, and boosted revenue by 25 percent to an all-time high of $8 billion.
But steep medical claims – for hip and knee replacements, heart procedures, specialty drugs and other costs – drove up medical claims from $5 billion in 2013 to $6.4 billion in 2014. Blue Cross also paid $156 million in ACA-related fees, a new cost for the company.
via Blue Cross and Blue Shield of NC posts first loss in 15 years | The Charlotte Observer The Charlotte Observer.
February 24, 2015
The Cadillac high-cost health plan excise tax, which goes into effect in 2018, is one of the last-to-be-implemented provisions of the Affordable Care Act (ACA). It was one of the most controversial provisions of the ACA, which contributed to its delayed effective date. But 2018 is now getting closer, and the Internal Revenue Services (IRS) is beginning a discussion about implementation of the Cadillac plan tax.
The Cadillac plan provision of the ACA will impose a 40 percent excise tax on the cost of employer-sponsored health plans when that cost exceeds certain thresholds. It is projected to be one of the biggest sources of revenue under the ACA; the Congressional Budget Office (CBO) in its 2015 Budget and Economic Outlook Report estimated that it would account for $149 billion in revenue between 2018 and 2225. Of this, however, only one quarter will come from the tax itself, while three quarters will come from increases in taxes on income as employers shift compensation from health benefits to taxable wages.
via Implementing Health Reform: Beginning The Cadillac Tax Regulatory Conversation And Other ACA News – Health Affairs Blog.