Don’t cry for Big Insurance if federal Obamacare subsidies go away, folks.

A helpful reminder: “…the dirty secret is that insurers stand to lose the most from King v. Burwell… The giant players — United Healthcare, Cigna, Aetna, Anthem and Humana — have seen stock prices double, triple, even quadruple since the law was passed in 2010. The coming ruling threatens to put an end to their gravy train.” As Betsy [McCaughey] noted elsewhere in that article, the insurance companies were more than happy to sign onto a program where they had a guaranteed – dare we say, mandated? – customer pool; and one where sweet, sweet tax revenue could be used to stitch together any gaps in this Frankenstein’s Monster* of a health care market.

Which means that health care insurers have absolutely no reason to complain that the State giveth, and the State taketh away.  That’s what the State does; and the insurers took the State’s Shilling.  It’s hardly our fault that this turned out to be unwise.

Moe Lane (crosspost)

PS: A bailout of the insurance industry, by the way, would be most unwise. The Right was not in favor of such a thing in 2014; we’re certainly not going to be more in love with the idea now.  As Betsy [McCaughey] also noted in the above article, removing the subsidies in the federal Obamacare exchange will effectively destroy the various mandates anyway. It might be worth keeping those subsidies around temporarily in exchange for formally killing the individual/employer mandates: I haven’t made up my mind about that yet. But it’s certainly true that if King v. Burwell goes away the mandates will have to as well. One way, or the other.

*One that is, by the way, the sole fault of Democrats.

3 thoughts on “Don’t cry for Big Insurance if federal Obamacare subsidies go away, folks.”

  1. I have shed more than enough tears as Corporate replaced my quite decent Blue Cross Blue Shield plan with a more expensive and less comprehensive United plan .. then raised the prices .. all while paying their mid-level management ridiculous salaries.
    I cannot calculate how few tears I would shed if one of ’em implodes.

  2. If the SC does pull the trigger, here’s what I think will happen. The R’s will put forth a bill to float the subsidies for the rest of O’s term in exchange for some reforms either temporary or permanent. The D’s in the senate with O’s support will balk and filibuster (unless Mitch finds a mechanism to get around a filibuster) and demand they change the law to explicitly provide the subsidies on federal exchanges. If Mitch does find away to get around the filibuster, O will likely veto and double down on the demand for permanently restoration.

    As far as DC is concerned all the pressure will be on the R’s to provide the subsidies. The only question is if they get bullied into permanently providing them. Given their performance since Nov, I do not have high hopes.

    1. Given their performance since Nov, I do not have high hopes.
      Robert Conquest’s Third Law of Politics: The simplest way to explain the behavior of any bureaucratic organization is to assume that it is controlled by a cabal of its enemies.

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