Obviously the Washington DC crowd – all of them – are in full panic-mode. Representatives and Senators are falling all over themselves to look as if they actually care about their constituents by offering bills that would allow people to keep their health care insurance if they wanted to.
Obama gave an embarrassing press conference, stumbling around a pretend-apology, pretend-outrage, etc. Late, as usual. Clinton did this, too. “The President will speak at x:xx am,” says the WH. Broadcasters nervously mumble, filling dead air time until said president shows up some 20-30 minutes later.
Anyway, Obama says he will “allow,” sometimes reported as “force,” insurance companies to let their insureds “keep their insurance, if they like it.” Again, he lied.
According to this post in one of our favorite blogs, Mish’s Global Economic Trend Analysis, neither Congress nor the President can do that. Mish re-printed a note from a Washington State Actuary that explains the situation.
Unwilling and Unable!
I am an actuary at a health insurance company and the economic impact Obamacare will have on healthcare/health insurance is far from “Affordable.” If anything, the Republicans should have asked for a name change on the bill.
I have experience in pricing policies on the individual market and for regulatory risk pools. When my company entered the individual market years ago, the best-selling plans were, by far, the higher deductible plans with the lowest premiums. It was what consumers could afford to buy. The government should not have been surprised at the feedback.
Obama today has relented to pressures by “allowing” insurers to bring the plans back for a year. He truly doesn’t mean it. He wants to assuage the public without undermining his signature legislation.
Regardless, it is not uncommon for states to require a 60-day notice for filing prior to a plan launch. It’s November 14th. Insurers have already passed the 60 day notification period to the states. I will be surprised if the insurers are even ABLE to re-instate plans;
Premiums would need to be developed, approved by the state, letters sent out, premiums collected, coordination with health providers, letters to the consumers.
Unlike HHS, our IT teams have to go through UAT testing before any changes become live. These things take time. Obama may even be counting on it. Why? Because if the medically underwritten population stay on their “cancelled” policies, that means less traffic to the exchanges Obama wants to promote, and less cost-subsidization which will wreak havoc on exchange premiums in 2015.
Washington state has already declared they will not allow Obama’s “fix” to go through. Rising premiums are only a symptom of the disease.
So, you see, once again the denizens of Washington DC have demonstrated their utter incompetence. They look only at polls and the TV Sunday shows, they don’t read, they don’t listen to the radio or their constituents or possibly their own staff people.
Investment lesson: You must do the hard work, the research, on the industry and the company you are looking at as a possible investment. Otherwise, you’ll end up with egg on your face, just like those doofuses in DC!