Anthem Blue Cross Predicted to Flee Obamacare

P. Gardner Goldsmith | April 3, 2017
DONATE
Font Size

News got out a few days ago that Obamacare is doing more of what it was designed to do: increase costs for patients and insurance companies – even the companies whose bosses thought they would win big if they cozied up to the politicians.

Late Thursday, Feb. 30, CNBC, Reuters, and a few other observant news outlets reported that Anthem (Blue Cross) is likely to pull out of the nightmarish Obamacare “marketplace” (a fascist non-market controlled by politicians) in 2018.

According to Dan Mangan, of CNBC, a new report from the analytical firm Jeffries confirms the stress on Anthem’s economic projections, and…

"…[this] comes almost two months after Anthem CEO Joseph Swedish warned the insurer, which sells plans under the Blue Cross Blue Shield might decide within months 'whether or not we surgically extract ourselves from certain rating regions, or even on a larger scale, depending on the stability of the marketplace.'"

Though politically-connected Anthem has taken advantage of Obamacare to gain market share at the expense of smaller companies, and is in the midst of a legally tendentious $54 billion buyout of Cigna in California that could make it the second-largest health insurance company in the state, the corporation cannot handle the spiraling costs of the federal “Guaranteed Issue” mandate – a mandate of the kind that started a 150% increase in health insurance costs over ten years when it was imposed on the state level.

As a result of spiraling expenses, Anthem, like many other insurers still trying to profit in this ever more fascist federal and state regulatory framework, has begun restricting the doctors and medical facilities it allows into its “marketplace” plans, and customers have become so upset, they’re taking the corporation to court.

Observing the Jeffries report on Anthem's impending departure from Obamacare, Reuters notes:

"Anthem is one of the few health insurers that still sells plans under Obamacare. Humana Inc (HUM.N), Aetna Inc (AET.N) and UnitedHealth Group Inc (UNH.N) pulled out after reporting hundreds of millions of dollars of losses… Anthem is leaning toward exiting a 'high percentage' of the 144 rating regions in which it currently participates, Jefferies analysts said in a note on Thursday after talking to the health insurer."

Many free market economists saw this coming before Obamacare was passed, because they saw this happen when “Guaranteed Issue” was mandated in state after state. Rates doubled in a few years, and younger people (ages under 35) dropped their policies. Almost consistently, in state after state – including New York, Kentucky, Ohio, New Hampshire and others – the nation saw young people wait to buy their insurance until after they got ill, leaving relatively older, sicker people in insurance pools, and raising costs for the companies. Many of the companies left those states, just like they are leaving Obamacare.

The death spiral of health insurance in this nation is happening right now, and politicians are not going to be able to fix it until they open their eyes to the reality that political impositions telling companies what to do, and whom to cover, simply increase costs and incentivize demographic groups to become “free riders” on the government mandates.

For many years, Blue Cross stood in various states as a non-profit that worked closely with politicians to stand near the top of the health insurance hill. But now, across the country, it is withdrawing from regions, and this looks to continue until the insurer is totally gone from Obamacare in 2018.

With nearly 40% of states down to two insurers still participating, does anyone seriously think this is going to get better? The prognosis is grim.

Thank you for supporting MRCTV! As a tax-deductible, charitable organization, we rely on the support of our readers to keep us running! Keep MRCTV going with your gift here!

donate