When Obamacare was first passed, there was much talk about how the program needed to get a certain number of people buying insurance to avoid the "death spiral". That spiral consisted of too few healthy individuals signing up, resultant premium increases and deductible increases, more people being priced out of the system, and so on until the whole system collapses. Even though president Obama got exactly the system he wanted, and even though none of the attempts by opponents to limit that system in any way have succeeded, Obamacare is moving quickly into the death spiral phase. Here are four points that prove that:
1. The estimate by the White House for the number of people buying health insurance on the Obamacare exchanges for 2016 is roughly half the number the same people predicted a few years ago for this point in the program. Simply put, the exchanges are about ten million people below the government's expectations. That's a lot of premiums that aren't being collected.
2. The cooperatives that sell health insurance were created as a result of Obamacare to increase the choices available at lower costs. Despite federal support for these entities, half of them have now gone out of business and millions of people lost their policies as a result. The coops just didn't get sufficient buyers to allow them to cover costs. These are the first deaths of companies due to the death spiral.
3. The nation's largest health insurance company, United Healthcare, announced that it is likely pulling out of the Obamacare exchanges next year (2017). The company said that it was just losing too much money on these policies and saw no way to turn the situation around.
4. The cost of policies on the exchanges are rising quickly and at the same time, deductibles are likewise rising. In other words, the policies are providing less but costing more. That will inevitably lead to fewer people buying coverage and more death spiral.
The death spiral is not a surprise to anyone who took the time to understand the dynamics of Obamacare when it was passed. Nevertheless, president Obama refuses to recognize the looming collapse of his namesake system. It needs to be junked and quickly.
1. The estimate by the White House for the number of people buying health insurance on the Obamacare exchanges for 2016 is roughly half the number the same people predicted a few years ago for this point in the program. Simply put, the exchanges are about ten million people below the government's expectations. That's a lot of premiums that aren't being collected.
2. The cooperatives that sell health insurance were created as a result of Obamacare to increase the choices available at lower costs. Despite federal support for these entities, half of them have now gone out of business and millions of people lost their policies as a result. The coops just didn't get sufficient buyers to allow them to cover costs. These are the first deaths of companies due to the death spiral.
3. The nation's largest health insurance company, United Healthcare, announced that it is likely pulling out of the Obamacare exchanges next year (2017). The company said that it was just losing too much money on these policies and saw no way to turn the situation around.
4. The cost of policies on the exchanges are rising quickly and at the same time, deductibles are likewise rising. In other words, the policies are providing less but costing more. That will inevitably lead to fewer people buying coverage and more death spiral.
The death spiral is not a surprise to anyone who took the time to understand the dynamics of Obamacare when it was passed. Nevertheless, president Obama refuses to recognize the looming collapse of his namesake system. It needs to be junked and quickly.
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