Insurance Companies Will Receive $5.5 Billion in Bailouts in 2015

[Jukai]

Yeah, Jukai, IMO, ben is the least intelligent regular here, but it seems like he's making a lot more sense in this discussion.

Ok, scenario: I sell bananas. There is only three banana stand guys in my area. The price of bananas per pound lowers by a dollar from my supplier. If none of the other guys lower their prices, why should I lower mine? It just means I'm making a dollar more per pound of banana.

Now, in fairness, this scenario isn't that great because you can argue that lower costs of bananas means people will buy more bananas. But if you are mandated to buy a minimum amount of bananas anyway...

 

[VulgarSnaps]

WTF is the definition of losses?

I predict :

They maintain current gross profit, see an increase in cost, and turn a slightly less net profit (1-7 percent).

They then cook their books, and we all pay to ensure they keep their per capita net

 

[ripskater]

Anyone remember, healthcare costs were rising out of control. We had to pass "Obamacare" so this wouldn't happen. "We don't have time to read the bill." LOL.

 

[Jack V Savage]

ok but how does the government make money off of this.. Explain the "fund" and is it treated as an investment??

What's to explain? It's in the OP.

"Under the Patient Protection and Affordable Care Act, insurers who record a profit of 3 percent or more on their Obamacare business would put some of the gains into a government-controlled fund. Companies whose claims cost at least 3 percent more than their premium revenue can access the money."

So the gov't collects money and then pays it out. The CBO projects that over the three years this is in effect, it will collect $16B and pay out $8B. 16 minus 8 is 8. Boom! There's your $8B. This isn't rocket science.

Ok, scenario: I sell bananas. There is only three banana stand guys in my area. The price of bananas per pound lowers by a dollar from my supplier. If none of the other guys lower their prices, why should I lower mine? It just means I'm making a dollar more per pound of banana.

Why is your supplier only selling to you? What's the advantage that your supplier has over the other suppliers? The situation you describe isn't sustainable.

WTF is the definition of losses?

I predict :

They maintain current gross profit, see an increase in cost, and turn a slightly less net profit (1-7 percent).

They then cook their books, and we all pay to ensure they keep their per capita net

Holy moly. Read the OP. You're giving ben a run for his money here.

Anyone remember, healthcare costs were rising out of control. We had to pass "Obamacare" so this wouldn't happen. "We don't have time to read the bill." LOL.

Uh, yeah. Healthcare costs were rising out of control, and then the ACA was passed, and healthcare cost growth has slowed to record low levels. Though it's just a coincidence, right?

 

[speakhandsforme]

No. Read about the policy. For one thing, the money isn't coming from taxpayers (read the OP); it's coming from other companies in the industry (and they all agreed to this beforehand). It's not about "saving the industry," it's just about intra-industry hedging.



That's not what's happening.

This is how I interpreted the process. After reading the first page of responses, I was beginning to think I had misunderstood the article.

 

[speakhandsforme]

What about the individuals who find the cost of the law higher than anticipated? Can we get bailed out too?

If those who benefited more than expected from enrollment are willing to forward their extra savings towards hedging your losses....then, sure, go for it.

 

[Jack V Savage]

If those who benefited more than expected from enrollment are willing to forward their extra savings towards hedging your losses....then, sure, go for it.

It would have been hilarious if that (voluntary) provision were in the law. GOP partisans would have had to put their money where their mouths were and either shut up or suffer financial losses.

Generally, I wish there were betting markets for Republican predictions.

 

[Stoic1]

Uh, yeah. Healthcare costs were rising out of control, and then the ACA was passed, and healthcare cost growth has slowed to record low levels. Though it's just a coincidence, right?

What the fuck planet are you living on?

 

[ripskater]

Uh, yeah. Healthcare costs were rising out of control, and then the ACA was passed, and healthcare cost growth has slowed to record low levels. Though it's just a coincidence, right?

I'm sure the Obamacare Insurance Company bailout will hardly cost a thing. The solution to keep down costs is to let these insurance companies go bankrupt. They drive up costs. Also, our idiot citizens feel that healthcare is a right. There is no longer an incentive to eat right, sleep 8hrs/night, and avoid risky behaviors. No problem, the govt will pay for everything!

 

[Jack V Savage]

What the fuck planet are you living on?

It's been about 4% annually since 2009. Since 1965, it's normally been over 10% and had never been below 5% even for a year before 2007.

I'm sure the Obamacare Insurance Company bailout will hardly cost a thing.

There's no bailout, and the estimated budgetary effect of the risk corridors is *positive* $8B over the three years they will be in effect. You can keep repeating GOP propaganda even after it's been factually refuted, but the facts are the facts.

The solution to keep down costs is to let these insurance companies go bankrupt. They drive up costs.

Insurance companies actually don't have a huge impact on healthcare costs. It's a low-margin industry. But, again, the risk corridors have zero to do with preventing bankruptcy. It's just hedging for the industry.

 

[speakhandsforme]

I'm complimenting you, big guy.

I made this observation in a gun violence thread last week. When I first came here, I seemed to remember ben being an utter dip shit whose posts only served to annoy. But, lately, I'd say ben and panamaican are probably the highest quality right-leaning posters on here.

 

[Jukai]

Why is your supplier only selling to you? What's the advantage that your supplier has over the other suppliers? The situation you describe isn't sustainable.

Well, I had to say "supplier" but I should have said I'm growing my own bananas. Actually, I just shouldn't have used the example of bananas.

What is the incentive of insurance companies lowering prices when things get cheaper if they can keep the same prices and get more money? Everyone is mandated to buy health insurance anyway. Lower prices across the board to get a handful of new people when you have tens of millions already signed up doesn't seem like a wise investment.

 

[Street Level]

This law is such a mess.

Why don't we just pay some small tax every month to find healthcare? If that just way too simple?

Besides my surgery on my wrist I haven't needed any type of healthcare for a few years and I'm just baffled as to why the government thinks I need it now.

When I lived I'm michigan I saw my doctor every other month to get a rx for anxiety meds and thats about it s far as my health needs since I was a kid. It costed me $60 to go see him. Why would I need insurance for that? Cash payment was it. This law sucks and I hope it gets fixed before my medicaid runs out next year (i have it for free for a year since I'm technically not working). Thank god I got it, and it's been a huge help, but besides having a broken wrist I dont need insurance.

 

[Zankou]

Total non-issue. Insurers pooling risk is not a 'bail out.'

 

[Jukai]

This law is such a mess.

Why don't we just pay some small tax every month to find healthcare? If that just way too simple?

Besides my surgery on my wrist I haven't needed any type of healthcare for a few years and I'm just baffled as to why the government thinks I need it now.

When I lived I'm michigan I saw my doctor every other month to get a rx for anxiety meds and thats about it s far as my health needs since I was a kid. It costed me $60 to go see him. Why would I need insurance for that? Cash payment was it. This law sucks and I hope it gets fixed before my medicaid runs out next year (i have it for free for a year since I'm technically not working). Thank god I got it, and it's been a huge help, but besides having a broken wrist I dont need insurance.

is this post purposefully ironic, or...?

 

[ben236]

Well, I had to say "supplier" but I should have said I'm growing my own bananas. Actually, I just shouldn't have used the example of bananas.

What is the incentive of insurance companies lowering prices when things get cheaper if they can keep the same prices and get more money? Everyone is mandated to buy health insurance anyway. Lower prices across the board to get a handful of new people when you have tens of millions already signed up doesn't seem like a wise investment.

If you can charge a significantly lower price than your competitors, you will get a lot more than just a handful of new people which would probably grow over time if your competitors are unable to compete. As you gain more and more market share, your competitors start going out of business due to losing customers which would increase your market share even further.

Undercutting competitors has been a business strategy since the dawn of capitalism for a reason... It works.

 

[Street Level]

is this post purposefully ironic, or...?

Yes. And slightly contradictary lol.

 

[AgentOrange24]

Anyone who didn't see this coming has their head completely up their ass.

 

[UpaLoompa]

Anyone who didn't see this coming has their head completely up their ass.

You mean the misrepresntation that this is a bailout?