Health insurance exchanges unraveling even before they gain experience

2014

Even before the initial enrollment closes, there are problems with the insurance exchange plans. Customers are complaining of a limited choice of participating doctors and hospitals and limited prescription drug coverage.

In response, HHS has issued yet more regulations which in part tell insurers what percentage of area providers they must allow to participate in their plans. This of course heads in the direction of shifting the pricing leverage back to the doctors and hospitals.

Americans enrolling in the exchange plans were supposed to be those without health insurance which means the choice of doctors should not matter. But of course many of the new enrollees had insurance that was no longer good enough to pass federal scrutiny and so they were forced to seek other coverage if the old plan was no longer available (even after that part of the law was also changed). These are the folks most likely caught in the whirlpool of federal compliance, controlling premiums and provider access.

Don’t you wonder exactly what we expect insurance companies to do to hold down premiums? They are limited in what can be spent on administration, including salaries and such (never a significant factor in premiums in any case), they must enroll all comers regardless of health status and now they must have wider networks of health care providers. And by the way, they are required to submit 2015 premiums only 60 days after the 2014 enrollment period closes.

Guess what, if you think low, “affordable” premiums are possible under this scenario, you are dreaming just like the liberal politicians dream when they think a solution to a problem is fact because they say so despite it violating the laws of human nature, economics or common sense.

In an ideal world we would all have unlimited access to any health care provider of choice with minimal cost sharing as well. Our premiums would truly be “affordable” without tax subsidies and the health care we receive would be high quality and efficient. Many people think that’s what Obamacare promised.

The Affordable Care Act is a house of cards. Every arbitrary change in the law, every new regulation from a federal agency (affecting insurance companies, employers, the health care system and industry) weakens its stability. [Just ask your employer what has to be done to determine eligibility and affordability for its health plan]. The Administration is constantly scrambling to fix this or that without regard to long-term consequences.

The fact is we can’t have it all (low cost and unlimited health care) and never could. This law makes unrealistic promises and has created unrealistic expectations it can’t keep and no amount of political wrangling will change that… before or after the November election.