Friday, December 16, 2016

Federal government seems to stiff many insurers over sicker patients under Obamacare

Amy Goldstein has a startling story in the Washington Post, reporting that the federal government has reimbursed health insurance companies only about 2% of the additional expenses incurred for covering claims for people with pre-existing conditions.

It sounds as though companies are getting stiffed, almost as if this were a debt ceiling crisis.  That explains why some major insurers, like United Health Care, are leaving Obamacare exchanges.  It’s hard to see how this is even legal.

That’s one reason why I think Trumps should set up a formal reinsurance company to handle pre-existing conditions, although what counts as pre-existing (if related to “behavior” or “moral hazard”) would be highly politicized.

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