Those Tricky Insurance Companies!

Reporting on Politics and Policy.
Nov. 14 2013 2:57 PM

Those Tricky Insurance Companies!

A wise reader writes in, cutting through some of today's PR and muck by bringing the topic back to the insurers.

In speaking with Empire Blue Cross of New York's marketing department, I know the following:
Private insurance companies are dropping pre-2010 (grandfather insurance plans), because they are not profitable, not because they don't meet ACA standards (those plans don't have to because of the grandfather clause).  However, the insurance companies are required by the ACA to provide low cost products to the exchanges, and they need to make up for this loss in premiums by, in part, canceling the private low premium insurance policies. That is simply a private business decision.
Now, several legislators are proposing bills (and the President by executive order)  that would require continuation of these canceled policies, which sounds interesting on it's face, but for one glaring problem. Insurance companies will simply raise the premiums of said policies, as high as necessary, to make up for the above losses or simply to drive the policy holders into canceling the policy because of inability to pay the high premiums.

I spoke with Senator Landrieu's representative today and broached this subject with him and he admitted that the effect of the Landrieu bill would be negated, by the above scenario.
Advertisement

Isn't this problem at the center of "Keep Your Plan" mania? Not to be a broken record about this, but, while not every week will be as panic-filled as this one, there's nothing at all preventing Republicans from blaming every future rate or premium hike on Obamacare. Democrats are now seeking a way to put the onus for sticker shock back onto the insurers. That, at least, was a major theme of their answers to reporters in the Capitol today.

David Weigel is a Slate political reporter. 

TODAY IN SLATE

The Juice

Ford’s Big Gamble

It’s completely transforming America’s best-selling vehicle.

Should the United States Grant Asylum to Victims of Domestic Violence?

The Apple Watch Will Make Everyone Around You Just a Little Worse Off

This Was the First Object Ever Designed

Don’t Expect Adrian Peterson to Go to Prison

In much of America, beating your kids is perfectly legal. 

Moneybox

How the Apple Watch Will Annoy Us

A glowing screen attached to someone else’s wrist is shinier than all but the blingiest jewels.

Music

A Little Bit Softer Now, a Little Bit Softer Now …

The sad, gradual decline of the fade-out in popular music.

Is Everyone Going to Declare Independence if Scotland Does It? 

I Tried to Write an Honest Profile of One of Bollywood’s Biggest Stars. It Didn’t Go Well.

Trending News Channel
Sept. 12 2014 11:26 AM Identical Twins Aren’t Really Identical
  News & Politics
Jurisprudence
Sept. 14 2014 2:37 PM When Abuse Is Not Abuse Don’t expect Adrian Peterson to go to prison. In much of America, beating your kids is perfectly legal. 
  Business
Moneybox
Sept. 12 2014 5:54 PM Olive Garden Has Been Committing a Culinary Crime Against Humanity
  Life
Inside Higher Ed
Sept. 13 2014 8:38 AM “You’re More Than Just a Number” Goucher College goes transcript-free in admissions.
  Double X
The XX Factor
Sept. 12 2014 4:05 PM Life as an NFL Wife: “He's the Star. Keep Him Happy.”
  Slate Plus
Behind the Scenes
Sept. 12 2014 5:55 PM “Do You Know What Porn Is?” Conversations with Dahlia Lithwick’s 11-year-old son.
  Arts
Music
Sept. 14 2014 11:44 PM A Little Bit Softer Now, a Little Bit Softer Now … The sad, gradual decline of the fade-out in popular music.
  Technology
Future Tense
Sept. 12 2014 3:53 PM We Need to Pass Legislation on Artificial Intelligence Early and Often
  Health & Science
New Scientist
Sept. 14 2014 8:38 AM Scientific Misconduct Should Be a Crime It’s as bad as fraud or theft, only potentially more dangerous.
  Sports
Sports Nut
Sept. 12 2014 4:36 PM “There’s No Tolerance for That” Pete Carroll and Jim Harbaugh say they don’t abide domestic abuse. So why do the Seahawks and 49ers have a combined six players accused of violence against women?