Bending that cost curve DOWN, baby!:
High medical costs from relatively small numbers of very ill enrollees to ObamaCare are leading large insurance companies to ask regulators in some States to raise their rates by more than 50% next year.
In New Mexico, for instance, Health Care Service Corporation is seeking an average jump of 51.6%, the Wall Street Journal reports. BlueCross BlueShield of Tennessee has sought an average raise of 36.3%, while CareFirst BlueCross BlueShield in Maryland has asked for a 30.4% increase.
"This year, health plans have a full year of claims data to understand the health needs of the [health insurance] exchange population, and these enrollees are generally older and often managing multiple chronic conditions," Clare Krusing, a spokeswoman for the Washington-based industry group America’s Health Insurance Plans, told the Journal.
"Premiums reflect the rising cost of providing care to individuals and families, and the explosion in prescription and specialty drug prices is a significant factor," she said.
The requests confirm a general premise of the [Una]ffordable Care Act: Older, sicker patients were more likely to sign up for plans — and this was, in theory, to be balanced by heavy participation by younger adults.
But attracting the younger, healthier people to Obamacare has proved challenging.
Because (1) younger, healthier people don't want it because they don't need it and are generally early in their careers and don't have as much disposable income to tie up in it and (2) the penalty for not having coverage is vastly less than the exorbitant cost of ObamaCare-mandated plans, so they just pay the penalty and proceed on their merry way. Precisely the perverse economic incentive that was built into ObamaCare five years ago in order to eventually destroy the private health insurance market, generate a health care "crisis," and force the final step to a total government "single-payer"/universal Medicaid takeover. We'll see if Health Care Service Corporation, BlueCross BlueShield of Tennessee, and CareFirst BlueCross BlueShield get their increases. If they do, they'll lose a ton of customers who can no longer afford the premiums, piling them into the already collapsing Medicaid system and weakening the private carriers further. If they don't, the private carriers will weaken even faster or simply pull out of those States, leaving all their former customers to either pay the Individual Mandate fine or disappear down the Medicaid drain.
Once again, it's simple economics: Skyrocket demand by telling the public something is "free," and you either explode the price (since supply is never as elastic) or hold down the price by artificial fiat and dry up and degrade the product. "Compassion" equals scarcity. It always has, it always will. And there's no federal magic wand that will ever change it.
I never thought it would be possible that one could begin to tire of opportunities to say, "I told you so." Now I'm beginning to wonder.
Exit thought: Is this a bad time for a reminder that the GOP Congress is preparing to restore illegal, unconstitutional ObamaCare subsidies if the SCOTUS strikes them down next month?
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