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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: FJB who wrote (754693)	11/26/2013 9:58:09 AM
From: joseffy	1 Recommendation Recommended By FJB Respond to of 1578452

Obamacare Designed To Fail: The ‘Kamikaze’ Attempt To Take Without Giving! ....................................................................................................................................... 24 Nov Given the failed launch of Obamacare, there’s a real chance that the entire scheme falls into an “insurance death spiral” — but not as visibly (or rapidly) as the way these sorts of unsuccessful insurance pools usually unravel. A death spiral happens when only the sickest beneficiaries get into an insurance pool, causing the cost of medical claims to rise, and in turn raising future premiums. These higher premiums, in turn, dissuade healthier beneficiaries from buying coverage. This exacerbates the strains and makes sure the pool continues to attract only the sickest consumers who are most in need of the medical coverage, and willing to pay the rising premiums. This is how the downward spiral ensues. Commentators have rightly noted here and here that Obamacare contains some provisions to guard against this sort of outcome. Chief among them are “risk corridors” that limit the losses insurers would face from higher-than-expected medical claims, as well as a pool of money (collected off a tax that is imposed on all non-exchange insurance products) to offset some of the rising costs and provisions that fix premiums as a percentage of peoples’ income (at least until 2018, when some of the ACA’s reinsurance programs sunset, although the risk adjustment provisions continue). But these provisions don’t eliminate the possibility of adverse selection against the Obamacare exchanges, and a downward spiral for these health plans, if younger and healthier consumers don’t enroll this year. For one thing, the exchange health plans would have to skinny down their networks, and benefits, to control rising costs. Meanwhile, plans sold entirely outside the exchanges will be subject to a different risk pool, and as a result, lower pricing. credit The1Stockman