On Wednesday, UnitedHealthcare Group Incorporated (UNH) announced that it will drop coverage of plans under Obamacare in all but a few states by 2017.
The stock market signaled a thumb’s up immediately after the announcement: UNH stock prices went 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”? Not affordable.
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.
We can expect more big stories with tags lines ballyhooing a “serious blow to Obamacare.”
But we can also expect apologetics.
With every blow to the program, every sign of weakness and demonstration of incompetence, there will be the de rigueur defenses written by journalists dead set against accepting any indicator that this program, snuck into the law under cover of general ignorance — Nancy Pelosi’ cheerful “we’ve got to pass it to find out what’s in it” — might not be any healthier than Social Security or Medicare or the whole, bloated, over-extended federal government, limping along on debt and the fakery of the Federal Reserve.
Indeed, death was built into the system. So the apologists are ready for it. The “genius” architects of Obamacare knew that private insurance would fail under this system. It just couldn’t be profitable. That is why they cleverly put in the periodic subsidies to insurance companies as a feature of the system. “Death was all part of the design. So is revival.”
The fact that bailouts will also proliferate?
They may not even get much play. Big companies accept federal money all the time. Whoopee. Big deal.
Still, when a big company bails? Pulls out of Obamacare’s failed market?
That is news. For now.
We are entering new territory here. No major welfare state program has ever gone down in full public view. Those Americans expecting handouts might even panic when the hand that feeds . . . bleeds. Out.
Denial. Anger. Acceptance. The usual routine at the death of a loved one.
We who never expected anything but kludge (at best) from the system might want to practice our deathbed manners now. We will need them sooner or later.
Perhaps Americans will accept freedom and responsibility as a consolation prize for the failure of big, Nanny government.
Meanwhile, the bloated behemoth limps along.
Paul Jacob, April 24, 2016
This column first appeared at Townhall.com.