Nobody could have seen this coming.
That's sarcasm, folks. Everyone but those who somehow thought that hope would somehow triumph over experience in the kinds of patients who would utilize Obamacare saw this coming. CNN Money Senior Writer Tami Luhby is reporting, with some apparent surprise, that "Obamacare patients are sicker and pricier than expected" (bolds are mine; HT Twitchy):
Patients in Obamacare are sicker and need significantly more medical care than those in employer-sponsored plans, according to a new Blue Cross Blue Shield Association report.
This raises fresh concerns about the possibility of steep rate hikes for 2017 and of insurers leaving the Obamacare exchanges.
... Obamacare members have higher rates of costly illnesses such as diabetes, depression, hypertension, heart disease, HIV and Hepatitis C.
They also use more medical services -- including emergency rooms, in-patient hospital care, doctors and prescriptions than patients in employer-sponsored plans. Their cost of care was 22% higher than those in work-based health plans in 2015, or $559 a month, on average, for Obamacare enrollees versus $457 for those in employer plans.
Frankly, it's a bit of a surprise that the 22 percent difference is as small as it is — until you remember that so many Obamacare plans have deductibles of $5,000 or more, far higher than those usually seen in employer-sponsored plans. The "cost of care" is the cost to the insurance company, and that cost doesn't kick in until deductibles are met.
Continuing, with an incoherent "point" made by an Obama administration spokesperson:
Ben Wakana, national press secretary, Health (and Human Services) Department ... took issue with the study's methodology, saying comparing newly insured Obamacare enrollees with those who've long been covered in the employer market makes the former look sicker.
Ben, they don't look sicker, they are sicker.
The insurance industry is taking huge hits, and people are gaming the system (as if no one predicted that would happen):
... the fact that these patients are sicker than expected is putting some insurers in a financial bind. Several have reported big losses and have questioned whether they can afford to remain in the Obamacare market. This group includes UnitedHealth (UNH), the nation's largest insurer, which expects to lose nearly $1 billion on Obamacare in 2015 and 2016 and may not participate in 2017.
Highmark, the nation's fourth-largest Blue Cross plan with members in Pennsylvania, West Virginia and Delaware ... has lost more than $773 million in its first two years on the exchanges. It called the losses "unsustainable."
Meanwhile, Blue Cross Blue Shield of North Carolina reported $282 million in Obamacare losses in 2015. To counter this, the company raised its rates an average of 32.5% for 2016. Its CEO, Brad Wilson, has said the insurer may exit the market in 2017.
... (Insurers) want the federal government to clamp down on the so-called special enrollment periods, which are intended to allow those under going life changes -- such as marriage or job loss -- to apply for coverage after open enrollment has ended. Insurers say that people are abusing the system, signing up only when they get sick.
World-class tweeter Iowahawk had the perfect response to CNN Money's "sicker and pricier than expected" headline:
As another tweeter observed: "I know exactly ZERO actuaries that are surprised by this. But math is elitist or something."
Math is a very stubborn thing.
Cross-posted at BizzyBlog.com.
