ObamaCare Clusterfuck: Will there be double-digit price increases in 2015, or will there be even crappier plans?
Insurance industry insider Bob Laszewski writes:
To properly price the exchange health insurance business going forward the carriers have to sharply increase the rates. A senior executive for Wellpoint, which sells plans in 14 Obamacare exchanges, is quoted in a Reuters article telling Wall Street analysts there will be big rate increases in 2015, "Looking at the rate increases on a year-over-year basis on our exchanges, and it will vary by carrier, but all of them will probably be double digits."
If the health plans do issue double digit rate increases for 2015, Obamacare is finished.
There are a ton of things that need to be fixed in Obamacare. But, I will suggest there is one thing that could save it.
Crapify the plans!
For insurers to have faith Obamacare is worth the continued investment and the risk the administration needs to quickly demonstrate they understand this program is in big trouble and they are willing to make big changes to save it.
And, whatever insurance executives think, do Democrats want to go into the November elections offering the same unattractive health plan offerings at even higher prices? Open enrollment doesn't begin until November 15 but the plans will be out and will be well publicized before Election Day.
The administration can go a long way toward fixing this and do it within the scope of the statute and their regulatory authority.
Here's what I would suggest.
Give carriers the ability to offer plans outside the Bronze, Silver, Gold, and Platinum structure.
Let them offer people plans they will find attractive––premium, deductibles, and benefits.
But, require any new plans to:
- Satisfy the 60% actuarial minimum in the statute––no "junk" plans.
- Give consumers the detail to compare the standard Silver Plan to any new offerings––full transparency.
Give carriers the ability to swap current benefit mandates (that were set by regulation not statute) for lower premiums and deductibles and be completely transparent in what those trade-offs are while still complying with the underlying statutory requirement that the plans must be worth at least 60% of total health care costs. The administration has the power to do this within the scope of the law.
Would such a range of choices lead to anti-selection within Obamacare?
Yes. But it would be manageable just as broad choices are manageable within the Medicare Part D program and the Medicare Advantage program where consumers are very happy with the choices they are offered and the plans have succeeded in getting an excellent spread of risk.
So, in essence, make ObamaCare like Medicare Part D! We know where that goes.