Pinal County, Arizona was in danger of being the first second third fourth place where ObamaCare caused insurance markets to collapse. As of last month, every private health insurance company now selling ObamaCare coverage in the county announced it would no longer do so in 2017. Had that scenario come to pass, it would have tossed nearly 10,000 residents out of their Exchange plans and left them to buy ObamaCare coverage outside of the Exchange, with no taxpayer subsidies to make the coverage “affordable.” If they didn’t buy that unaffordable coverage, ObamaCare would still subject them to penalties, at least until the Secretary of Health and Human Services intervened.
It appears that Pinal County has avoided that fate. Blue Cross Blue Shield of Arizona has announced that, despite reservations, it will sell ObamaCare coverage in Pinal County next year. Pinal County now joins 13 other Arizona counties, one third of counties nationwide, and seven states that will have only one carrier in the Exchange.
The Wall Street Journal reports, “The insurer’s agreement represents a victory for federal and state officials, who have been pushing to resolve the situation in the weeks since it emerged.” The Journal neglects to mention this “victory” for the government comes at the expense of Exchange enrollees and taxpayers. The Associated Press reports Blue Cross Blue Shield of Arizona will be increasing premiums on Exchange enrollees by a whopping 51 percent. Imagine your annual ObamaCare premium is $14,000. Now imagine it rising by $7,000. Some victory.
If you live in Arizona, you may not have to imagine. Blue Cross Blue Shield of Arizona will be the only carrier selling on the Exchange in 13 of 14 counties in the state, and has requested what Charles Gaba describes as “a whopping 51.2% average [premium increase] statewide.” Remember when President Obama excoriated insurers for “unacceptable” premium increases as high as 39 percent? Remember when he promised ObamaCare would make such exorbitant premium increases a thing of the past?
Now that private insurance executives have pulled ObamaCare’s cookies out of the fire, in Arizona and everywhere the Exchanges are down to a single carrier, the industry appears to have the ObamaCare ideologues over a barrel. Blue Cross Blue Shield of Arizona, which has lost close to $250 million in the Exchange, no doubt has a wish-list of regulatory and legislative changes that would bail them out “stabilize the market.” The Obama administration and state regulators appear ready to hand insurance companies the keys to the treasury.
ObamaCare supporters signal their willingness to bail out private insurance companies – and their disdain for taxpayers and Exchange enrollees – every time they suggest these premium hikes are no big deal because the government subsidizes premiums. Not only do government subsidies not reduce the cost of ObamaCare coverage – they simply shift the cost from enrollees to taxpayers – half of ObamaCare enrollees don’t even get subsidies. Robert Laszewski writes, “many millions of people…have no choice but to take the full whack from these rate increases if they want to stay covered.”
Those who are ideologically committed to ObamaCare, or utterly dependent on it, can rejoice that it didn’t collapse today. Those who seek a sustainable and secure system of subsidies for the sick aren’t celebrating. The fact that ObamaCare has sunk so low, and may sink lower still, means the case for repeal is stronger than ever.