Santa Monica Observer - Community, Diversity, Sustainability and other Overused Words

By Christine Emerson
Observer Staff Writer 

Democrats Celebrate as Aetna Health Insurance Withdraws From Obamacare States

Nancy Pelosi admits that the ultimate goal was a government-run single-payer health plan

 

August 22, 2016

Aetna, Inc. is an American managed health care company, which sells traditional and consumer directed health care insurance plans and related services

Democrats may publicly chide Aetna from pulling out of all but four states in the ACA exchanges, but privately they're breaking out the champagne, led by Nancy Pelosi, the Democrat representative from San Francisco who's credited with pushing the ACA, aka Obamacare, through a bitterly divided congress. Many observers of the health insurance reform have been convinced that Obama and his like-minded left-wing allies presented Obamacare as a "first step," a step expected - and quite possibly calculated - to fail. The next step would be what they really wanted: a single-payer government-run health system.

Aetna, one of the biggest insurers in the nation, announced on Monday they will cease participating in the ACA exchanges in all states but Delaware, Iowa, Nebraska, and Virginia. In an official statement, Aetna cited losses of over $430 million. Aetna added in their statement that they are not alone. "More than 40 payers of various sizes have similarly chosen to stop selling plans in one or more rating areas in the individual public exchanges over the 2015 and 2016 plan years, collectively exiting hundreds of rating areas in more than 30 states," according to their statement.

Aetna also cited an imbalanced risk pool as a reason they were unable to break even. "Providing affordable, high-quality health care options to consumers is not possible without a balanced risk pool. Fifty-five percent of our individual on-exchange membership is new in 2016, and in the second quarter we saw individuals in need of high-cost care represent an even larger share of our on-exchange population. This population dynamic, coupled with the current inadequate risk adjustment mechanism, results in substantial upward pressure on premiums and creates significant sustainability concerns."

Unsurprisingly, Aetna and the other exiting health insurers discovered that the people who chose to buy insurance on the exchanges were those in actual need of health services. Young people who are healthy and are not already covered by their employer may not be entering the exchanges and thus not adding their premiums to the pool of money available to treat these sick people - the foundational notion of the ACA.

Democrats on the Hill responded to Aetna's pullout with anger and an accusation of blatant manipulation. Aetna is currently facing a U.S. Department of Justice lawsuit seeking to block its planned $37 billion merger with other health insurance giant Humana. They claim that as recently as April, Aetna CEO Mark Bertonlini had stated, "We see this as a good investment," speaking of Obamacare. Obamacare proponents believe Aetna is attempting to use its power in the health market to get the DOJ to back down regarding the Humana merger.

But while liberal lawmakers and pundits may decry Aetna's decision and the removal of their significant financial weight from the public exchanges, they are privately thrilled. Not only do they wish the ACA to fail, but they prefer it to fail due to the perceived inability or greed of private insurers like Aetna.

The architect of the plan, Massachusetts Institute of Technology economics professor Jonathan Gruber, knew as early as 2009 that the ACA would be financially unfeasible. He advised in a policy brief that the way to pass the legislation was to completely ignore costs. And it worked. "So what's different this time? Why are we closer than we've ever been before? Because there are no const controls on these proposals. Because this bill's about coverage. Which is good! Why should we hold 48 million uninsured people hostage to the fact that we don't yet know how to control costs in a politically acceptable way? Let's get the people covered and then let's do cost control."

Gruber knew - and the White House knew - that the ACA would not work. In a 2013 video, Gruber was famously caught on tape saying that the legislation had passed due to "lack of transparency and "the stupidity of the American voter."

It is icing on the cake that the plan's impending implosion will seem due to private enterprise, as symbolized by Aetna and the other insurers pulling out of the exchanges.

Aetna, Inc. is an American managed health care company, which sells traditional and consumer directed health care insurance plans and related services

In 2014 Representative Nancy Pelosi admitted, "Well, of course I wanted single-payer, and I wanted a public option. But that not being in the mix, uh, you have to prioritize what it is you want to get over the finish line." The ultimate goal was a government-run single-payer health plan.

Even earlier, in August, 2013, then-Senate Majority Leader Harry Reid was yet more specific about perceiving the ACA as an initial step on the road to universal government health care. In an appearance on a Las Vegas PBS show, Reid said we have to "work our way past" insurance-based health care. "What we've don with Obamacare is a have a step in the right direction." When questioned whether Reid meant he wished to abandon health insurance as a means to paying for health care , he responded. "Yes, yes. Absolutely, yes."

Aetna, Inc. is an American managed health care company, which sells traditional and consumer directed health care insurance plans and related services

 

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