One major health insurer is pulling out of ObamaCare exchanges, while another announces that it is considering its options for departure. Both of these “corporate persons” are whining about losses because of the cost of providing care. In one case, some of these losses are “projected” – in other words, they haven’t happened yet. At the same time, officials in one state have taken partial control of of the other company because of the risk to health care consumers. Could this be the beginning of the end for America’s corrupt, corporate, profit-driven health care system?
In mid-January, United Health Care Group announced that it lost $720 million by participating in the exchanges established under the Affordable Care Act – although a third of that figure is due to “advance recognition” of losses for this year that have not yet been incurred. The nation’s largest private, for-profit health insurer is seeing its earnings drop by $238 million. Because of this, company representatives say the company may pull out of its participation in the exchanges.
Another major insurer, Moda Health, announced that it is withdrawing from exchanges in Alaska and Oregon. Robert Gootee, CEO of Moda, Inc., said
“Bringing tens of thousands of people into the ACA marketplace, many of them with acute health care needs, has been a difficult process to manage…the cost of providing this level of care, with all its attendant uncertainties, has put an unprecedented financial strain upon our health plan.”
This announcement came in the wake of Oregon state officials taking partial control of the Portland-based health insurer in order to protect consumers.
Interestingly, while Moda claims it is “struggling” to provide care to its insureds, the company had no problem coughing up millions of dollars in order to have Portland’s main indoor sports arena, formerly known as the Rose Garden, renamed “Moda Center.” Moda also received a total of $100 million in loans from Oregon Health & Science University and its parent company last year. According to the local news, Moda’s finances are in such disarray that state officials are stopping the company from issuing or renewing policies and are transferring 67,000 of its members to other insurers. Moda has been given until 5 PM local time on Friday, February 5th, to get its finances in order.
At the same time, United’s chief financial officer Dan Schumacher is wailing about how his company is incurring greater losses than expected because growing enrollment is cutting into its precious profits. Another company official told investors, “By mid-2016 we will determine to what extent, if any, we will continue to offer products in the exchange market in 2017.” In other words, members can expect to pay more and receive less and less in order to protect corporate profits.
That’s what it is all about: profits, not health care. This is the disease that continues to infect the U.S. health care system, despite reforms enacted by the Affordable Care Act.
Do the actions taken by Oregon state insurance officials in taking over Moda mean the end of private health insurers? No – at least, not immediately. However, those actions do suggest that the days of for-profit health care in the United States are numbered. This is happening at a time when GOP members of Congress are vowing to make further cuts to entitlement programs in the face of ballooning health care costs. Right wingers like old “lyin’ Ryan,” who have continually attacked at undermined the ACA at every turn are frothing at the mouth to take their axes to Medicare and Medicaid.
Of course, Presidential candidate and Progressive champion Bernie Sanders has other ideas for turning Medicare into a national single payer system. Sanders’ plan would involve raising taxes, but those increased taxes would be more than offset by the tremendous savings Americans would enjoy on their health care expenses (something that Hillary Clinton and the GOP are incapable of comprehending – but that other countries figured out decades ago).
In any event, if what is going on with Moda Health and United is any indication, the for-profit model of health care – long ago exposed for the corrupt criminal enterprise it is – may be on its way out the door, one way or another.
Good riddance to bad rubbish.
