Anyone who watched the TV news on 3/7/17, heard the republicans talking points that Obamacare is on a “death spiral” echoing the words of the Aetna CEO who has been resorting to this rhetoric. And of course, this is not true.
The words “death spiral” is a specific insurance terminology which refers to the inevitable cycle where insurance premiums keep rising dramatically to where more and more young healthy adults start dropping out of the insurance market until the system collapses.
This year of 2017, there has been a record number of Americans enrolling to purchase health coverage made available through the ACA, the Affordable Care Act or Obamacare which puts the lie to the republicans’ claims that the ACA is in a “death spiral” cycle.
Yes, there are flaws with the ACA which are imminently fixable, if there was a bipartisan consensus in the US Congress to do this. For example, the US congressional representatives could for once, adequately fund the ACA risk corridors as required, within the ACA law. Again, “risk corridors” is an insurance term and it is NOT A BAILOUT as the republicans are prone to call it. By not funding this ACA requirement in 2016, the republicans were able to deliberately cause the recent premium and deductible increases with some insurance companies having to withdraw from the ACA marketplace.
Here is a link to a Politifact report which calls Senator Rubio’s claim a lie, that funding risk insurance corridors for the Affordable Care Act (ACA) is equivalent to a corporation bailout. (Marco Rubio: We ‘wiped out’ Obamacare ‘bailout fund’)
Here is what Robert Pear wrote about this in his 12/9/15 NY Times report:”A little-noticed health care provision slipped into a giant spending law last year has tangled up the Obama administration, sent tremors through health insurance markets and rattled confidence in the durability of President Obama’s signature health law.”
The attack stems from two years of effort by Senator Marco Rubio and others (Jeff Sessions) in Congress to undermine a key financing mechanism in the law. So for all the Republican talk about dismantling the Affordable Care Act, one Republican presidential hopeful has actually done something toward achieving that goal.
Mr. Rubio took credit for republican led efforts against the so-called risk corridor provision of the health law but this plan in limiting how much the government can spend to protect insurance companies against financial losses has shown the effectiveness of quiet legislative sabotage. (Sabotage was really led by then Senator Jeff Sessions.)
The risk corridors were intended to help some insurance companies if they ended up with too many new sick people on their rolls and too little cash from premiums to cover their medical bills in the first three years under the health law. But because of Mr. Rubio’s efforts, the administration says it will pay only 13 percent of what insurance companies were expecting to receive this year. The payments were supposed to help insurers cope with the risks (called adverse selection) they assumed when they decided to participate in the law’s new insurance marketplaces.”
“Mr. Rubio’s talking point is bumper-sticker ready. The payments, he says, are “a taxpayer-funded bailout for insurance companies.” But without them, insurers say, many consumers will face higher premiums and may have to scramble for other coverage. Already, some insurers have shut down over the unexpected shortfall.”
PolitiFact calls Senator Rubio’s claims a lie. (Marco Rubio: We ‘wiped out’ Obamacare ‘bailout fund’)
For those who are active in the resistance, it is crucial to make those contacts with our legislators, during this week of 3/8/17 while the republicans are rolling out their ACA replacement plan.
The main US Senate phone line 202-225-3121 (202-224-3121) or YOU CAN FIND PHONE NUMBERS FOR EVERY SENATOR HERE.
More Data To Counter Republican Talking Points:
As per a 1/10/17 AP Fact check: Obamacare is not in a “death spiral:”
President Donald Trump says that President Barack Obama’s health care law “will fall of its own weight.”
House Speaker Paul Ryan says the law is “in what the actuaries call a death spiral.”
And Senate Majority Leader Mitch McConnell says that “by nearly any measure, Obamacare has failed.”
“The problem with all these claims: They are exaggerated, if not downright false.”
“Congressional representatives are working to portray it as a mess of Democrats’ making, and themselves as the ones who will clean up that mess.”
“In the process they are exaggerating the law’s very real problems, according to health care experts, who largely believe that the Affordable Care Act’s troubles with high prices and lack of competition could be addressed with bipartisan solutions.”
“Republicans, who’ve gained political advantage from campaigning against the law since its passage in 2010, aren’t interested in playing along. Instead they’ve denounced the law and made the case to repeal it, although there are signs some are getting cold feet.”
“But with Republicans in the majority and driving the agenda, here’s a look at some of the GOP claims about the law, and how they compare with the facts:”
TRUMP, RYAN AND MCCONNELL: The law will “fall of its own weight,” is in a “death spiral” and “has failed.”
THE FACTS: “Experts agree that the law is not currently in a “death spiral,” an actuarial term that refers to a vicious cycle when rising insurance costs force healthy customers out of the marketplace, resulting in still higher prices, which cause even more customers to bail, etc., until the system collapses.”
“The American Academy of Actuaries itself disputed the “death spiral” claim (in mid January 2017). The group provided a statement from its senior health fellow asserting that high premium increases in many states this year “do not necessarily indicate that a premium spiral is occurring” and could be a one-time adjustment.”
RYAN: “You cannot fix a fundamentally broken law; you’ve got to replace it.”
THE FACTS: “Experts agree that Congress could fix the law’s problems, should it choose to do so. Indeed many argue that some of the law’s problems can be traced to the decision by Obama and Democrats to push it through on a partisan basis – alienating Republicans who have refused ever since to participate in any attempt to tweak the law to improve it, as would be necessary with any program of such size and complexity.”
“Some predict that when Republicans get through with their repeal-and-replace effort, what it will really amount to will be an improved Obamacare – even if they don’t admit it.”
“The health care exchanges, for example, could be improved with changes aimed at getting more young and healthy people to sign up, such as giving insurers more flexibility to charge older people higher prices.” (This means that younger folks would be charged much less. But without a mandate, this plan is unrealistic.)
“You could, I think, relatively simply address the issues that the exchanges have,” said Dan Mendelson, of Valere Health, a health consulting firm, noting that other major programs including Medicare have been tweaked repeatedly since their creation. “If you freeze a program in a point of time, it is likely to have problems, and that’s exactly what’s happening.”
MCCONNELL: Obamacare “didn’t lower costs, it didn’t increase choice.”
THE FACTS: McConnell’s comments are true in part.
“The first five years of Obama’s presidency saw historically slow growth in U.S. health care spending. Some credit the global recession. Individual consumers in the law’s marketplaces, meanwhile, face higher premiums this year, though subsidies protected most customers from the increases.”
“And while the Affordable Care Act did increase choice initially in the individual market, that is not the case now with brand-name insurers bailing out of the online state markets, although the many Americans with employer-based health coverage have been insulated from such changes.”
“In about one-third of U.S. counties, consumers in the individual markets don’t have a choice of plans.”
“It depends for whom you’re talking about,” said Larry Levitt, senior VP at the Kaiser Family Foundation. “For people with pre-existing conditions, choices are infinitely more abundant because they couldn’t get coverage at all. For someone who’s young and healthy there are likely fewer choices available now than before.”
On 1/16/17, Jordan Weissmann of Slate.com penned the following report, “Paul Ryan’s Big Lie About Obamacare:”
“To hear Ryan tell it, Congress needs to abolish the Affordable Care Act immediately because the law is in the midst of a “death spiral.” If you’ve been following the health reform wars of the past few years, this is a term you have almost certainly heard bandied about. It describes a worst-case scenario in which high premiums discourage healthy Americans from buying insurance, leaving behind a market full of sick, unprofitable customers whom carriers are still required to cover under Obamacare’s regulations. That drives premiums even higher, pushing away more healthy shoppers. The process repeats until insurers flee and the market unravels.”
During the early fall, there was some speculation that Obamacare might have entered the early stages of a death spiral. A handful of major carriers announced they were pulling out of the law’s insurance exchanges after losing too much money on them. (There were losses which were caused by the US congress failing to adequately fund “risk corridors” as promised within the ACA/ Affordable Care Act.) Many markets were left with just a single insurer. The government announced that average premiums were rising nationwide.”
“But we are now most of the way through open enrollment, and Obamacare sign-ups are rising. This is in fact the opposite of what’s supposed to occur in a death spiral. As of late December, a record 11.5 million Americans had enrolled in coverage on the marketplaces, up 286,000 from the same time a year before. Sign-ups even jumped in Arizona, where the insurance market seemed most imperiled thanks to its giant premium hikes.”
“There’s just no evidence I’m aware of that (Obamacare) is in mid-collapse. Perhaps Ryan has some secret info the rest of us aren’t privy to.
This blog was updated on 3/8/17.