Insurers Oppose Obamacare Extension as Danger to Profits
Allowing Americans more time to enroll for health coverage under Obamacare may raise premiums and cut into profits, insurers are telling members of Congress in a bid to stop such a move.
Extending the enrollment period would have a “destabilizing effect on insurance markets,” said Robert Zirkelbach, a spokesman for the Washington-based lobbyist group American’s Health Insurance Plans. Allowing younger, healthy Americans to sign up later, as they probably would, means less revenue for insurers counting on those premiums to help defray the cost of sicker customers, threatening industry profits.
“If you can enroll at any point in the year, then you can just wait until you get sick,” Brian Wright, an analyst with Monness Crespi Hardt in New York, said in a telephone interview. “This isn’t the industry crying foul and exaggerating the issue, this is actually one of those issues where there is a well-grounded reason for the concerns.”
So let’s learn from this story: The insurance companies were planning to profit big from Obamacare.
That’s why they set up an (arguably phony) 501(c)3 organization, Enroll America. You can read about the protest to the IRS here from Cause of Action:
CoA sent a complaint to the IRS advising that Enroll America, a § 501(c)(3) organization, is in violation of several provisions of the Internal Revenue Code, and that an immediate investigation is warranted to determine whether its tax exemption should be revoked. Enroll America is primarily organized to benefit the health insurers, pharmaceutical companies, and other for-profit commercial entities represented on its board of directors and advisory council, and is therefore not organized to achieve any of the lawful purposes listed under IRC § 501(c)(3).
Originally, the insurance companies thought they would get free advertising from Congress, but as David Spady wrote in early August, it didn’t turn out that way:
Obamacare is now relying on a simple math equation. By 2016, the Administration will need 22 million uninsured Americans signed up with new state-based insurance exchanges or the federal government’s program. Enrollment begins on October 1, with a goal of at least 7 million people onboard over the next year. Included in this goal are 2.7 million young adults who aren’t exactly enthusiastic about signing up. Needless to say, it will require a massive public relations and education campaign to get these young people signed up. Congress hasn’t provided Obama with the funding to make this happen but that’s not stopping the Administration from finding other methods to achieve its goals.
On queue, several private non-profit tax-exempt organizations, managed by former Obama political operatives, have popped up to do the job. But there are serious questions about whether organizations like Enroll America are really operating as non-profits. Enroll America’s board of directors includes representatives of “for-profit” healthcare providers such as Teva Pharmaceuticals and Kaiser Permanente—big business interests that will clearly profit from Obamacare enrollment. Big insurance companies such as Aetna and Blue Shield, who rely on young adult enrollment with their companies, have also jumped on board. Tom Epstein, Vice-President of Public Affairs for Blue Shield is a member of the board of directors for Enroll America. Epstein is clear about the benefit to Blue Shield, “We’re losing money on individual policies right now. We’ll definitely need to make some money in the exchange.”
So rather than fight tooth and nail to really oppose Obamacare before and after it was passed, the Insurance companies decided to profit from the oppression of the American people. But now it has reached such a bad point that their plans are being derailed and their industry might be hurt.
Well, boo hoo, insurance “giants”! All the small people in America are suffering so you can just join in and take a share of the pain—since you were e far more directly involved in causing it.
Their stocks soared when Obamacare opened. I will be cheering to see them plummet.