Death Spiral is ObamaCare Reality


The insurance carriers are heading for the exits. The “death spiral” feared by ObamaCare supporters is the new reality. Ironically, the proof of this came on Valentine’s Day.

The “death spiral” refers to conditions that exist when insufficient enrollees in an insurance product drive the price even higher causing even fewer to enroll. It becomes impossible to entice enough new enrollees to keep the cost of the policies from rising even higher. The inevitable result is the collapse of the insurance market.

On Valentine’s Day, Molina Healthcare announced it will not be offering healthcare insurance plans on the ObamaCare exchanges in 2018. The company’s profits tumbled in 2016 on the exchanges and they reported losses of $110 million.

They were not alone. Aetna CEO Mark Bertolini admitted ObamaCare was in a “death spiral” due to a risk pool with too many sick people and too few healthy enrollees. Bertolini predicted more insurers would withdraw because of the law’s poor risk pools. Aetna already dropped 70% of its ObamaCare marketplace offerings because of hundreds of millions of dollars in losses.

Humana announced one day earlier they were exiting from the eleven states where they offered ObamaCare policies beginning in 2018. Humana left four other states in 2017. United Health began this exit of insurance carriers when they pulled out of 34 states in 2017.

This should come as no surprise to anyone who has been following ObamaCare news since 2010, the year the new healthcare legislation was passed. From the beginning there were signs this situation might happen, despite all the happy talk from Democratic supporters and the Obama White House.

Enrollment in ObamaCare is down again this year, according to The Washington Examiner. Only 9.2 million Americans signed up for health insurance, reflecting 3 million new users. But that’s below the 9.6 million who signed up on for 2016 coverage, though the new numbers don’t include data from the 12 state-run exchanges, which will be released soon.

Naturally, Democrats are blaming Republicans for this failure, accusing them of destabilizing the individual marketplace where those without employer-provided insurance must purchase their coverage. But does anyone really believe that average folks want Republicans to do nothing about rising premiums and deductibles – so high now that people can’t afford to use the insurance they have!

No, the failure of ObamaCare is owned by the Democrats – lock, stock and barrel. Not a single Republican voted for it and not a single Democrat opposed it. Now that the “death spiral” is reality, it’s time to replace it with something better. It’s time Democrats worked with Republicans to pass new legislation that works for everybody. It’s time to put country above party and work together to form “a more perfect union.”

Now that would be a novel idea!

One comment

  1. Hi Bob,
    I do enjoy your informative and well written updates on Obamacare. They are timely and easily understood by those of us less informed. Thanks for your study and investment of time.

    Comment by Robert Burden on February 28, 2017 at 9:01 pm