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The Blue Cross and Blue Shield Association just released data on their experience in the Obamacare health insurance exchanges. (here) The Association represents 36 companies, many of which are the largest health insurance companies in their respective states.
Bottom line, the enrollees in the exchanges are sicker than the enrollees in company plans. In 2014, the exchange patients were 19 percent more expensive than employer-based patients. In 2015, the difference went up to 22 percent more expensive.
This is no surprise and was predictable from the outset of Obamacare. The Affordable Care Act forces health insurance companies to sell policies to anyone, regardless of pre-existing medical conditions. Regardless of whether this is a good public policy, the reality is that insurance companies must attract many more healthy individuals to offset the cost of the sicker people with pre-existing medical conditions.
The architects and proponents of Obamacare estimated that the exchanges needed at least 40 percent of enrollees to be young and healthy to offset the costs of the sicker patients. (here) As of December, 2015, only 28 percent of enrollees were in the young demographic. (here)
In spite of the mandate in Obamacare requiring every adult 18 years of age and older to purchase health insurance, healthy young people find it cheaper to pay the fine or “tax” for not having health insurance than to actually buy the insurance.
The CO-OPs in Obamacare are failing dramatically. (here) If the Blue Cross and Blue Shield companies pull out of the exchanges, the viability of a significant portion of the law is at tremendous risk.
