Obamacare insurance can drive you to financial ruin

The Affordable Care Act (ACA) was meant to keep medical expenses from driving you to financial ruin, not for medical insurance to drive you to financial ruin.

But that is what we have now, and it’s exactly what everyone here at RVO predicted years ago. If you’re middle class on a non-subsidized ACA plan, a family of four spends about $1,300 a month in premiums. The deductible for those plans is $13,000 per year. So once you pay $28,600 out-of-pocket each year, your insurance kicks in.

Look at that number again. Twenty eight thousand six hundred dollars.

Where is that $28,600 going? Insurance companies are not keeping it*. The insurance companies are using most of it – or all of it it – to pay healthcare providers for services provided to other subscribers. Most of those other subscribers are on government subsidized programs or have very expensive pre-existing conditions. Of course, they will also use it to cover health care costs you have once you’ve paid your $28,600.

Insurance companies must also cover costs and payments to healthcare providers for mandated coverage requirements. You know, mandates requiring them to insure – without question – those with extremely expensive pre-existing conditions at “normal” rates. Think about that for a moment. It’s kind of like not having insurance when you wreck your new car in the morning. No problem, walk into Progressive in the afternoon and make you first $200 monthly payment on your new policy. Then, walk out with a check for $40,000 to replace your new car.

No, it’s exactly like that.

Obamacare Risk-Corridor Payments Fall Short

Still, insurance companies are losing money and pulling out of the market. This is not unexpected and we also predicted this. The risk corridor scheme was set up to help insurance companies cover losses during the first three years. But just as they got started, the government realized they would not have enough to cover the losses.

In the end ACA insurers collectively incurred $2.87 billion in losses exceeding the risk corridor boundaries, but only ended up owing $362 million in contributions. CMS was able to pay out only $0.126 on the dollar to insurers owed payments, although it reiterated its intent to pay out the full amount owed over the life of the program. This funding shortfall resulted in severe losses for a number of insurers, and several, including a number of consumer cooperative (CO-OP) plans became insolvent.

Are you still wondering why it is failing? It’s clear, there is no “affordable” in the Affordable Care Act.

* Yes, insurance companies do use some of the funds to cover administrative costs.

Thank goodness – There is a bailout for insurance companies built in to Obamacare

I’ll try to make this somewhat complicated event easy to understand. Insurance companies submit estimates for insurance costs (payouts) in to the federal government. If the payouts exceed 103 percent of the estimate, the taxpayers cut a check to insurance companies for 50 percent of the loss. 108 percent equals an 80 percent bailout.

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Federal health insurance exchanges … this will not go well

How can anyone feel good about this? We’ve got a bunch of states stating they will not create exchanges simply because it will cost way too much money, which leaves the responsibility to President Obama’s Department of Health & Human Services to create and manage this boondoggle.

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Three Good Reasons

With the much anticipated release of the Supreme Courts Ruling on Obama-Care and while surfing the web last night while watching television,  I stumbled upon an article entitled “Three Reasons The Supreme Court Should Overturn Obama-Care’s Individual Mandate”. Read more

Another approach to health insurance: deregulation

In 1993 Maine enacted health insurance regulations that, among other things, told insurance companies that they pretty much had to charge the same premiums to all who applied.  This concept is called “community rating”, and it is an essential piece of Obamacare.  Read more

Catholic school will no longer require or offer health care insurance to students

Well, sort of kind of. This is the first step Franciscan University of Steubenville has taken to reduce costs and avoid the ObamaCare mandates specific to contraception. Franciscan is a very small school with about 2,500 students so I’m not sure this is a huge deal, but I tell ya … it’s exactly what President Obama and the liberal/statist/socialists want.

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Should employers have to cover gender reassignment surgeries?

Some people think yes, they must do so or they are guilty of discrimination. Sandra Fluke and Karen Hu wrote a paper for The Georgetown Journal of Gender and the Law in 2011 that reviews employment, hiring and termination discrimination in the workplace against lesbians, gays, bisexuals, transgendered and queer (LGBTQ) employees. All fine and good. But then …

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“My son’s losing hope” Obama: But we passed health care and took over student loan industry

Broken record indeed. The only answer President Obama has in response to questions like the one asked yesterday in Iowa is that he knows times are tough, but at least kids have health care until they are 26 and the government took over the “terrible” student loan system.

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Health care mandates result in 18% premium increase in Connecticut

All across the United States, health insurance companies like Anthem Blue Cross and Blue Shield in Connecticut are meeting with state insurance regulators about premiums. During the past couple of weeks, Anthem proved to Connecticut state regulators an average 18 percent premium increase reflected the requirements of federal health care mandates and increased provider costs.

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People really think they can sign up for free health care!

People are starting to contact insurance companies asking how they can sign up for Obama’s free health care plan. Do you think they will freak out when they find out they have to pay for it, and if they don’t, the IRS will ensure they do?

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