Think Freely Media presents Common Sense with Paul Jacob

In his 2012 State of the Union speech, President Obama declared, “It’s time to apply the same rules from top to bottom: No bailouts, no handouts and no cop-outs.”

Yes. He said that. But in reality, the handouts and cop-outs have kept on coming, like the solar wind.bucket for bailout

A Washington Examiner editorial notes that while “Obama blasted the influence of insurance lobbyists and vowed to take on the industry … as president, he passed a health care law that funnels more than $1 trillion in subsidies to insurers, and fines Americans who do not purchase their products.”

Go ahead: call that a handout.

But what about bailouts?

While newspapers like The Washington Post insist that Obamacare is exempt from such an eventuality, there remains the part of the Affordable Care Act known as the risk corridor programs. These reimburse “insurance plans for claims that cost significantly more than premiums that new subscribers paid in,” according to The Post’s Wonkblog. The goal is to protect health insurance companies from the risks they face in the new Obamacare exchange.

Companies that make money will pay into a fund that will be used to bail out companies that lose money. But, after obvious complaints about limits, the Centers for Medicare and Medicaid Services (CMS) pushed a mandate that the program be revenue neutral, that the money paid out not exceed that paid in.

Last Friday, in 435 pages of regulations, CMS abandoned this call for budget neutrality. Instead, the regulation states, “In the unlikely event of a shortfall for the 2015 program year, HHS recognizes that the Affordable Care Act requires the secretary to make full payments to issuers.”

A taxpayer bailout: fully in place.

This is Common Sense. I’m Paul Jacob.

By: Redactor

5 Comments

  1. Rick says:

    Get ready, it’s gonna be a massive money loser.

    We have ceased to be a “Rule of Law” country.

    In our father’s America, Credit Suisse would have lost their bank charter and simply gone out of business after pleading guilty like this:

    Business as usual at Credit Suisse amid guilty plea
    “We have found no instances where clients cannot do business with us,” says Credit Suisse (CS) CEO Brady Dougan one day after the bank pleaded guilty to tax evasion and agreed up to $2.6B in fines. “Our discussions with clients have been very reassuring and we haven’t seen very many issues at all.”The deal will cut Q2 income by about $1.8B, and Dougan says CS will pare some assets to try and restore its capital levels.The day after the well-telegraphed deal, shares are up 1.4% in premarket action.Previously: Credit Suisse to pay $2.6B in settlement

  2. Rick says:

    OT We are embraced by banks that rig every market in the world. The Fed being the biggest. THese guys should all be put out of business but as Eric Holder admitted several years ago, these banks are ‘Too big to prosecute”. I expect only a handslap here. From today:

    (Reuters) – European Union antitrust regulators charged Europe’s biggest bank HSBC, U.S. peer JPMorgan and France’s Credit Agricole on Tuesday with rigging financial benchmarks linked to the euro, exposing them to potential fines.

    The European Commission also said it would charge broker ICAP soon for suspected manipulation of the yen Libor financial benchmark.

  3. Rick says:

    Another OT: I think the US indictment of the Chines military officials is the most HYPOCRITICAL thing we have done in foreign policy ever. Our foreign policy is running us off a cliff right now.

    China just banned Microsoft Windows 8 from gov’t computers.

  4. Brian Wright says:

    Paul, really an excellent inside-the-Beltway, (good) semicorporate-libertarian analysis. Where’s MY bailout? Once again, your spam arithmetic questions may be getting a little too challenging.

  5. Drik says:

    There will either be a MASSIVE bailout of the insurance industry….
    or there will be a collapse of the private insurance industry….to pave the way for the government to take it all over and then deciding who dies.
    A win either way for this administration.
    Since collapse is the goal.

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