When health insurance companies lined up in support of Obamacare, many critics of the proposed health care law were perplexed. Twenty years earlier, First Lady Hillary Clinton proposed a similar massive takeover of the health care industry which was vigorously fought by insurance companies. This time around, the companies were not only tacit in their support of the law, but outright supportive of it.
It turns out that the law contained provisions to cover the insurers against their losses for the first three years from having to cover people with chronic illnesses and pre-existing conditions. However, those benefits are now sun setting and insurers face the prospect of how to cover the large expense of insuring people with no regard to the condition of their health. When Obamacare was being debated, critics charged the law was designed to cause the private health care insurance market to collapse under its own weight. Now, it may be that claim may proves to be true.
For the time being, insurance companies are requesting large increases in premiums to cover the cost of insuring those previously uninsurable. While insurance commissioners from the states may approve some increases, it is not certain if they will approve them in total. This is forcing the unintended consequence of insurance companies having to merge in order to stay financially viable. The result promises to be fewer choices for consumers, fewer doctors and participating hospitals, and reduced coverage. It is a scenario that has Americans losing at every turn from employer sponsored coverage, to private insurance coverage, and increasingly unaffordable health insurance premiums.
Thanks to my friends at CipherCloud for introducing me to this new angle on this old story.