Last Wednesday, UnitedHealthcare Group Incorporated (UNH) announced that it will drop coverage of plans under Obamacare in all but a few states by 2017.
The market signaled a thumb’s up: UNH stock prices shot up over 2 percent.
The company, described in the news, somewhat vaguely, as the country’s largest insurer, is sending us a signal: the Affordable Health Care Act and its “Obamacare”?
An insurance policy must make sense to both parties, the insured and the insurer. The insured gets peace of mind . . . and coverage when the rare events insured-for take place. The insurer has written enough insurance contracts out there, prices based on actuarial risk, to allow it to make a profit even with payouts.
The problem with the ACA is that it raised costs (in part by forcing insurers to take on patients with pre-existing conditions) while regulating terms of policies offered . . . and prices, too.
Plus, face it: the idea that one should insure for regular checkups is just one of the many absurdities built into the system.
It’s just too much meddling to work, in the long run. Bailouts and subsidies of those insurance companies that stick with the plan will then make the program unaffordable . . . for America’s taxpayers.
Over-regulated and over-subsidized, Obamacare suffers from the preposterous idea that a bird’s eye view of the economy from the politicians’ perch gives enough information to run complex systems servicing millions of people with diverse needs.
Expect more big stories with tags lines ballyhooing a “serious blow to Obamacare.”
This is Common Sense. I’m Paul Jacob.
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