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Senator: I told you so about Obamacare

Legislative update

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POSTED: November 29, 2013 3:30 p.m.

No one likes to hear “I told you so…”
But when it comes to Obamacare, some of us can’t help but say “I told you so.” The rollout of Obamacare has truly been like watching a train wreck.
On Oct. 1, the highly anticipated insurance exchanges, online marketplaces where individuals could search for and buy health insurance, were set to open.  After repeated assurances of their preparedness from the executive branch, primarily the president, the exchanges were found to be woefully inadequate and embarrassingly dysfunctional.
The hole continues to get deeper as we now find out that Obamacare officials, caught flat-footed trying to build the websites on schedule, rushed to hire a familiar contractor without seeking competing bids as is required by law.   
Even today, weeks after their supposed start date and millions of dollars over budget, the websites aren’t functioning properly, leading to frustration among everyone involved and resulting in only a fraction of the expected new sign ups.
During this time, people perfectly happy with their existing policies are having them cancelled right and left, despite earlier assurances from the president himself that, “If you like your health plan, you can keep it.”   
Finally acknowledging that this was simply not true, the president addressed the nation last week to express his supposed understanding of how people are upset that they were misled and proposed a “fix” by delaying tougher restrictions set to go into effect the first of the year so that current insurance plans would not be canceled.
Even members of the president’s own party are realizing that this is a train wreck, with 39 Democrats voting last week to adopt H.R. 3350, the Keep Your Health Plan Act. The Republican-sponsored bill passed the House by a vote of 261-157 and will allow insurance companies to continue offering policies that would be canceled because they do not meet the standards of Obamacare.
Can it get any worse?  
Yes, it can and probably will.
Last week, Sen. Marco Rubio, R-Fla., introduced legislation that would eliminate the risk corridor provision of Obamacare, a provision that could lead to the taxpayer bail-out of insurance companies which lose money as a result of Obamacare.
Risk corridors are used to lessen the pricing risk that insurers face when their data on health spending for potential enrollees are not established.  When Obamacare was passed, it contained a section that provides for a temporary risk-corridor mechanism for the first three years (2014-2016) of the law’s implementation.
Simply put, with the risk corridors in place, the insurance companies will have a safety net to ensure that they cannot possibly lose more than a certain amount of money as a result of Obamacare.  
The flawed thinking behind this — and the reason it was implemented for only a brief time period — was that with a new program like Obamacare less expenditure data would be available.  In order to encourage more competition among insurance companies, the risk corridors were added to limit the downside risk for insurers.
The problem with these Obamacare risk corridors, and the reason for Sen. Rubio’s legislation, is that they are designed in such an open-ended manner that with the president’s recent “fix” to allow Americans to keep their existing plans, a bailout of health insurance companies becomes a real and potentially expensive possibility.
By changing the rules mid-stream, the president makes it more likely that insurance companies will receive a taxpayer bailout as a result of the risk corridors similar to the Wall Street bailouts a few years ago.
Taxpayer bailouts remain as popular as the plague.
I have yet to figure out how a company like Goldman Sachs, which received more than $12 billion in taxpayer bailout funds and promptly eliminated 1,000 American jobs and then outsourced them overseas, was deemed too big to fail, yet Carter’s Pharmacy, with three locations and 19 employees was not too big to fail.   
Can Obamacare get any worse?  
Yes, it can.
Unless the open-ended risk corridors written into Obamacare are eliminated or curtailed, look for more tax payer bailouts — only this time it’ll be of insurance companies and not Wall Street companies.     

Carter can be reached at 404-656-5109.

 

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