Beyond the Obamacare Website Fiasco

October 31, 2013

Obamacare's computer glitches have reduced the president's eponymic health-care plan to fodder for late-night TV comedians. But in some ways the president is fortunate that the computer fiasco is obscuring the even bigger and more consequential problems facing the law.

For example, there's the problem with keeping your current insurance.  Millions of Americans are finding out that, even if they like the plans they have now, they are being kicked off because those plans do not meet the requirements of Obamacare.

  • Florida Blue, for example, is canceling nearly 300,000 policies, about 80 percent of its individual policies in the state.
  • Kaiser Permanente in California has sent notices to 160,000 people - about half of its individual business in the state.
  • Highmark in Pittsburgh is dropping about 20 percent of its individual-market customers, while Independence Blue Cross, the major insurer in Philadelphia, is dropping about 45 percent.

Meanwhile, in the group market, we are seeing companies begin to drop insurance for their workers.

  • Roughly 160,000 workers at Walgreens are losing their coverage.
  • So are some 20,000 part-time workers at Home Depot, and roughly 15,000 spouses of workers at UPS.

Being forced to change plans means that many Americans will not be able to keep their current doctors. Insurance plans available on the exchanges - and in most states the selection of available plans is extremely limited - have been rapidly dropping doctors and hospitals from their networks.  

  • In Illinois, Blue Cross and Blue Shield said that at least some of its plans will no longer include Rush University Medical Center or Northwestern Memorial Hospital in their networks.
  • In California, most insurers won't include UCLA Medical Center, and none will include Cedars Sinai.
  • In New Hampshire, WellPoint, the only insurer participating in the exchange, covers just 14 of the state's 26 hospitals, and has dropped about a third of the physicians who used to be part of its network.

The network downsizing is not confined to the exchanges either.  Comparisons of exchange premiums with those found prior to October 1 show that premiums are higher now in at least 45 states, in some cases as much as 256 percent higher. As predicted, the young and healthy are seeing the biggest increases.

It may not be long before Obamacare supporters look back longingly to the days when the health-care law was just a bad joke.

Michael Tanner, "Beyond the Obamacare Website Fiasco,"  Cato Institute, October 30, 2013. 

 

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