From the archives. Originally posted January 24, 2014.
Are you aware that under ObamaCare more than $1 trillion of taxpayer funds go to insurance companies? For what?
Why subsidies for insurance companies to help people sign up to buy their products—products that by law citizens and companies are required to purchase. Here Cato Institute’s Michael Tanner explains the ugly meltdown of O’Care.
To avoid the death spiral, the Obama team estimated that it needs roughly 38 percent of people buying coverage via the exchanges to be under age 35. But data the administration released this month suggest that it’s turning out to be just 24 percent so far.
Data from individual states appears equally troubling. In New York, only 27 percent of exchange enrollees are 35 or younger, while 53 percent are over age 45. In New Jersey, 35-and-unders made up only 23 percent of enrollees; in Connecticut, less than 20 percent.
Oh, and a Reuters survey finds that new enrollees are also less healthy than ObamaCare’s designers hoped, too. Humana, one of the nation’s largest insurers, reports that so far enrollment in its exchange-based plans has been far “more adverse than previously expected.”
Worried about the insurance companies taking a bath on this? Don’t: ObamaCare’s designers set up a $25 billion reinsurance fund to protect insurers from losses due to adverse selection, funded by a $63-a-year tax . . . er, fee on all health policies.
So the “death spiral” may well leave ObamaCare exchanges covering far fewer Americans than planned, but the insurance industry will be OK because we’ll essentially be bailing it out.
This on top of the fact that ObamaCare already directs more than $1 trillion of taxpayer funds to insurance companies in the form of subsidies to help people buy their products — products that the law mandates that people and companies purchase. You can’t say that ObamaCare has no winners.
But those winners won’t include most of the rest of us, who’ll end up paying higher taxes and higher premiums, while getting less health care.
Listen as closely as you like on Tuesday, but I suspect the president won’t be saying much about this. And, really, can you blame him?