Forbes: Obamacare Insurers Lost Billions “Financial Bloodbath”

The Congressional Budget Office CBO predicted that profits from ObamaCare’s top insurance companies would generate $8 Billion for the “Risk Corridor” – the pool of money to help insurers that lost money in the program. So how did the CBO do?

Forbes:

The new data shows that the amount insurers who made money in the individual market were required to contribute in 2015 was $89 million but the claims by losers against that money for that year amount to $5.3 billion. This is a ratio of about 60 to 1.  The figures for the small group market are even worse: profitable insurers contributed a paltry $6 million to Risk Corridors. Losers in the small group market are owed $594 million for 2015.

It is hard to overstate how bad the 2015 data is.  Here are some ways of assessing the magnitude of the financial bloodbath.

  • Although the individual market was considerably bigger in 2015 than it was in 2014, contributions to Risk Corridors were only about 1/4 as much in the individual market
  • There was one insurer in the individual market who made enough money in the exchanges that it could contribute over $10 million into Risk Corridors.  There were 105 insurers in the individual market who lost enough money in the exchanges that they are owed over $10 million.
  • There was one insurer in the small group market who made enough money in the exchanges that it could contribute over $1 million into Risk Corridors. There were 61 insurers in the small market who lost enough money in the exchanges that they are owed over $10 million.
  • There were 24 states in which not a single insurer made a contribution to Risk Corridors in the individual market.
  • There were 33 states in which not a single insurer made a contribution to Risk Corridors in the small group market.
  • There are nine insurers (Blue Cross Blue Shield of Texas”, “Blue Cross Blue Shield of Illinois”, “Blue Cross and Blue Shield of NC”, “Freelancers Health Service Corporation d/b/a Health Republic Insurance of New York”,  “BCBSM, INC.”, “Highmark Inc.”, “Health Net Life Insurance Company”, “Blue Cross Blue Shield of Oklahoma”, “Humana Employers Health Plan of Georgia, Inc.”, “Colorado Health Insurance Cooperative, Inc.”) that have each requested more than $100 million  in Risk Corridors money — more than all the contributions for 2015 put together.
  • Blue Cross Blue Shield of Texas did so poorly it has requested $596 million in Risk Corridors money.  It likely won’t see a dime of it.  (This might explain why Blue Cross/Blue Shield requested a 58% rate increase for 2016).

 

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About Chuck Norton

I write about politics, education, economics, morality and philosophy.
This entry was posted in CBO, Econ, Health Law, Lies, Obama, Taxes, True Talking Points, Trump, Uncategorized. Bookmark the permalink.

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