Tag: health insurance premiums

Federal Court Declares ObamaCare’s Individual Mandate Unconstitutional

ObamaCare has always hung by an absurdity.  ObamaCare supporters claim that the Constitution’s words “Congress shall have the Power…To regulate Commerce…among the several States” somehow give Congress the power to compel Americans to engage in commerce.  This ruling exposes that absurdity, and exposes as desperate political spin the Obama administration’s claims that these lawsuits are frivolous.

This ruling’s shortcoming is that it did not overturn the entire law.  Anyone familiar with ObamaCare knows that Congress would not have approved any of its major provisions absent the individual mandate.  The compulsion contained in the individual mandate was the main reason that most Democrats voted in favor of the law.  Yet the law still passed Congress by the narrowest of all margins – by one vote, in the dead of night, on Christmas Eve – and required Herculean legislative maneuvering to overcome nine months of solid public opposition.  The fact that Congress did not provide for a “severability clause” indicates that lawmakers viewed the law as one measure.

Despite that shortcoming, this ruling threatens not just the individual mandate, but the entire edifice of ObamaCare.  The centerpiece of ObamaCare is a three-legged stool, comprised of the individual mandate, the government price controls that compress health insurance premiums, and the massive new subsidies to help Americans comply with the mandate.  Knock out any of those three legs, and whole endeavor falls.

Moreover, the individual mandate is not the law’s only unconstitutional provision.

These lawsuits and the continuing legislative debate over ObamaCare are about more than health care.  They are about whether the United States has a government of specifically enumerated powers, or whether the Constitution grants the federal government the power to do whatever the politicians please, subject only to a few specifically enumerated restraints.  This ruling has pulled America back from that precipice.

NPR Story Was Hardly Biased, but the Headline?

Today’s NPR story, “Health Law Hardly At Fault For Rising Premiums,” was much fairer than its headline (and the sub-heads, if that’s what we call them).   ObamaCare is “hardly at fault for rising premiums?”  Really?  The story quotes an insurance-industry flack who well establishes what the Obama administration’s own regulations confirm: ObamaCare will be a major driver of premium increases for some health plans.  A sub-head calls such claims “misinformation.”  Oh?  The article does more to bolster those claims than the administration’s flack does to knock them down.  A more accurate headline would have been, “Health Law at Fault for Rising Premiums? In Some Cases, Yes.”

One wonders whether, in some posh Versailles salon, there’s an editor who already knows what the headline should be – never mind what the article says.

ObamaCare Prods Yet Another Insurer to Flee the Market

First, a dozen insurers said they would stop writing child-only health insurance policies.  Now, according to the Wall Street Journal:

By forcing the exit of Principal Financial Group — which ran a profitable, $1.6 billion health insurance business — ObamaCare has now left 840,000 Americans to find another source of coverage.

According to The New York Times, other insurers may soon follow:

More insurers are likely to follow Principal’s lead, especially as they try to meet the new rules that require plans to spend at least 80 cents of every dollar they collect in premiums on the welfare of their customers…

“It’s just going to drive the little guys out,” said Robert Laszewski, a health policy consultant in Alexandria, Va. Smaller players like Principal in states like Iowa, Missouri and elsewhere will not be able to compete because they do not have the resources and economies of scale of players like UnitedHealth, which is among the nation’s largest health insurers.

Mr. Laszewski is worried that the ensuing concentration is likely to lead to higher prices because large players will no longer face the competition from the smaller plans. “It’s just the UnitedHealthcare full employment act,” he said.

Let’s remember what President Obama told a joint session of Congress just one year ago:

So let me set the record straight here.  My guiding principle is, and always has been, that consumers do better when there is choice and competition.  That’s how the market works… And without competition, the price of insurance goes up and quality goes down.  And it makes it easier for insurance companies to treat their customers badly – by cherry-picking the healthiest individuals and trying to drop the sickest, by overcharging small businesses who have no leverage, and by jacking up rates.

Everybody got that?

ObamaCare Leads Minnesota Insurers to Suspend Sales

From the Minneapolis Star-Tribune:

Two of Minnesota’s biggest health plans said Thursday they have temporarily suspended sales of individual health insurance policies because of uncertainty related to the new federal health reform law.

The moves by Blue Cross and Blue Shield of Minnesota and HealthPartners came on the same day some of the federal government’s most-heralded consumer protections came into effect…

The insurers that have suspended individual sales say they are awaiting guidance on new rules, including those around coverage of kids with pre-existing conditions…

Pam Lux, a spokeswoman for Eagan-based Blue Cross, said she expects the suspension of individual sales to be brief but could not say if it would be days or weeks.

Many Supporters Not Willing to Trumpet ObamaCare’s Achievements

An interesting update on the politics of ObamaCare appears in CongressDailyPM (subscription required):

The marking of six months since the signing of the healthcare law should be a moment of celebration by Democrats, especially as several popular provisions go into effect today. But the political realities of the midterm elections have made trumpeting the law, which remains unpopular with large swaths of the electorate, a delicate balancing act for Democrats…

House leaders tell their members to address the healthcare law in a way that best suits their districts…

some Democratic members in the House and Senate instruct staff not to write talking points on the law’s six-month provisions…

a former administration official questions if Democrats’ efforts to sell the bill are making any significant headway…

It’s little wonder, really.

But still.  Wow.

ObamaCare’s Premium Refunds: Bad News for the Sick

USA Today and Politico Pulse report that ObamaCare has prompted BlueCross BlueShield of North Carolina to rebate $156 million to its customers in the individual market.  This may seem like good news.  It’s actually bad news, particularly for BCBS’s sickest customers.

Pre-ObamaCare, BCBS’s customers – whether healthy or sick – had coverage with an insurer that had already pre-funded their future medical needs. Competition protected them from BCBS skimping on care: if BCBS got a reputation for skimping, it would have a hard time enrolling new customers.

Post-ObamaCare, BCBS no longer needs that pile of cash, so they’re returning it to their customers. That hurts sick enrollees because BCBS is doling it out to all enrollees – not just the sick enrollees whom that money is supposed to serve. This cash-out is actually a transfer from the sick to the healthy.

Also, every BCBS customer who is sick or becomes sick in the future will have less protection against their insurer skimping on care. Competition used to discourage insurers from providing lousy access to care, but under ObamaCare competition will reward skimping. Under ObamaCare’s price controls, insurers that gain a reputation for providing quality coverage to the sick will attract sick people and go out of business.  Insurers that gain a reputation for providing lousy access to care will drive away sick people and thrive.