A stagnant 'pool'
ObamaCare sows the seeds of destruction for its “exchanges” through provisions that give young, healthy Americans lacking employer-based plans — whose participation is key to exchanges' success — perverse financial incentives to not participate.
In a new paper, National Center for Public Policy Research health care policy analyst David Hogberg, Ph.D., says the upcoming “Covered California” exchange needs young, healthy people to balance the higher costs of insuring older, sicker people. Yet ObamaCare discourages their participation by requiring that insurers:
• Charge everyone the same rate (with limited exceptions). That means young, healthy people will pay roughly market rates, despite costing insurers less.
• Sell anyone a policy at any time during an annual open-enrollment period. That means many young, healthy people can wait to buy policies until they're sick.
Mr. Hogberg says many young, healthy Californians will pay less in ObamaCare fines for being uninsured than premiums — even offset by Obama-Care tax credits — will cost them. He predicts a “death spiral” for California's exchange:
As its “pool” becomes ever older and sicker, premiums will rise ever higher — and insurers will drop out.
Likely to occur in other states, too, it's a scenario that belies the Affordable Care Act's name and ostensible purpose of covering the uninsured — and a major reason why ObamaCare must be scrapped.