President Obama blamed health-insurance cancellations on “bad-apple” insurers, who presumably offered and then cancelled the lousy, cut-rate insurance plan that you liked, but don’t get to keep, because they (the insurers) are bruised and full of worms.
That’s the extent of the rational explanation the president offered for the supposed “bad-apple” cancellations: that they were perpetrated by “bad apples.” Which, by definition, as we all know, do “bad apple” things.
But it turns out that, in California, at least, the bad apples were actually located in the administration of the Covered California (Obamacare) state health exchange. They were the ones who, quite literally, required the cancellation of the insurance policies Californians liked.
Now, this whole “debate” – which has really been more like the exchange of pleasantries between opposing European soccer fans – has been a slogan-intensive bait-and-switch confrontation all along. None of it has made sense, on the Obama-left side of the argument. The president’s apparent assertion about “bad-apple” insurers is that they were taking advantage of you by selling you cut-rate “junk” insurance, so now, with the government forcing them to sell you more expensive non-junk insurance, it’s their fault that they have cancelled your old cut-rate policy, and will be charging more for coverage and deductibles you didn’t request or agree to. (Come on, Obama-left: you can’t pretend that higher premiums, for higher deductibles and mandated coverage that people don’t need or want, are “better.” The American people may be dumb, but we’re not stupid. We know worse when we see it.)
Critics on the right have approached what we might call the Obama Implication, about “bad-apple” insurers, as if there is something intelligible there to argue against. Some critics have argued that insurers weren’t selling “junk” policies. (Did subscribers with Kaiser and Blue Shield, for example, really think they had “junk insurance”?)
Others have argued that, whether they were or weren’t, Obamacare is still what caused the insurers to have to drop the policy you liked, because its provisions make your favored policy non-compliant starting on 1 January 2014.
The latter argument is a deductive one, which may or may not gain traction with the American demographic that has European-soccer-fan brain. The argument requires making the abstract connection between policy non-compliance and the necessity, under law, to stop offering policies.
But the revelation about Covered California requires no such powers of deductive reasoning. Citing the explicit provision in the contract insurance companies had to sign to join the Covered California exchange, Cal Watchdog and the San Francisco Business Times have identified exactly which entity mandated that the policies Californians like today be cancelled. That entity is Covered California. Here is the language from the contract:
Contractor agrees that effective no later than December 31, 2013, except as otherwise provided in State Law, it shall terminate or arrange for the termination of all of its non-grandfathered individual health insurance plan contracts or policies which are not compliant with the applicable provisions of the Affordable Care Act. Contractor agrees to promote ways to offer, market and sell or otherwise transition its current members into plans or policies which meet the applicable Affordable Care Act requirements. This obligation applies to all non-grandfathered individual insurance products in force or for sale by Contractor whether or not the individuals covered by such products are eligible for subsidies in the Exchange.
In the “Well, duh” corner, we have this observation at the SF Business Times (emphasis added):
[I]n California… health insurers who hoped to participate in the Covered California exchange had to agree to the changes in order to be part of the federally subsidized health insurance marketplace.
Otherwise, many healthy people may have decided to stay with their existing individual and family plans, leaving Covered California… to deal with a potential deluge of sick people seeking coverage and not enough healthy ones to make the project actuarially sound.
For some reason, meanwhile, the forcible tinkering with people’s health insurance isn’t causing important numbers to go in the direction they’re supposed to:
Interestingly… the average age of persons enrolled in Obamacare is 51-54. By contrast, in 2013 the average age of someone enrolled in pre-Obamacare insurance was 41, which is close to the U.S. median age of 37 years.
“This is significantly going to blow costs up, and taxpayers will be on the hook to pay for the difference,” said [Obamacare expert Craig] Gottwals. That’s because older people require more health care.
He said there is a bailout plan already written into the Affordable Care Act, which requires U.S. taxpayers to pay the difference between what care is covered and what is not. “It is going to go way over budget, and taxpayers are on the hook for 80 cents on every dollar,” said Gottwals.
Breaking news as this goes to post: In the top-of-the-hour news break on KFI AM 640, I just heard that Blue Shield (and apparently another company, whose name I didn’t catch) will be restoring about 100,000 cancelled policies in California. The policies will be effective only through 28 February 2014, however. I’ll supply a link and/or update on this information as it becomes available.