By Mike “Mish” Shedlock
Nearly the entire state of Tennessee has a single Obamacare provider. In sixteen counties, none of this year’s providers want to do business.
Mississippi, Alabama, South Carolina, Oklahoma, Alaska, and Wyoming are states where there is only a single provider for the entire state. Iowa is likely to be covered by a single provider next year. Most of North Carolina, Florida, Missouri, and Arizona are also in a single-provider situation.
Enrollment for 2018 starts in November. Will the problem be fixed by then? If not, What Happens if Places Have No Obamacare Insurers?
The markets created by the Affordable Care Act have always relied on the voluntary participation of private companies. If the government set up the right conditions for the market, the thinking went, insurers would want to jump in. But, as Sarah Kliff at Vox.com has reported, the law contained no real backup plan if that vision didn’t work out.
So far, there are parts of Tennessee where none of this year’s insurers want to sell insurance next year. Other counties have only one carrier, and in some of them, that carrier is looking shaky.
If insurers do all decide to exit a market, no one is exactly sure what will happen next. Some experts have brainstormed about possible workarounds, but all would entail uncharted legal territory.
Senator Lamar Alexander of Tennessee, the state currently at greatest risk of bare counties, has introduced a bill that would create options for customers shut out of their Obamacare market. But even if Congress passed such a law, regulators would have to work very fast to make anything happen before next year’s enrollment period, which begins in November.
No Backup Plan
Multiple sources tell me that White House staff held a meeting today to discuss cost-sharing reduction subsidies — that $8 billion Obamacare program whose fate still hangs in limbo. Ending these payments could “blow up” the health law’s marketplaces, but President Trump has so far waffled on what he’ll do about the issue. The meeting didn’t include any outside advisers or industry officials, only administration staff.
Right now there are 16 counties in Tennessee where no health insurer wants to sell Obamacare coverage. Iowa could be next: Half its Obamacare insurers announced this month that they would no longer participate in the marketplace. That leaves 94 of the state’s 99 counties with just one insurer — and regulators there aren’t totally sure that plan, Medica, will stick around.
“We don’t have any commitment from the two carriers that remain that they will be there,” says Doug Ommen, Iowa’s insurance commissioner. “They’re not required to file with us until June. Certainly we’re hopeful, but unless Congress acts, our market will continue to be very unstable.”
What happens if no one wants to sell coverage? Does the law have any fallback plan? The short answer is no. There is no backup plan for places where no insurer wants to sell Obamacare coverage.
Even before the election, some big insurers had decided that the Obamacare marketplaces were not good for their bottom lines. Aetna and UnitedHealth mostly withdrew in 2016, leaving lots of places with just one insurer.
Since the election, health insurers have only gotten more skittish. Humana announced in February that it would no longer participate. That left those 16 Tennessee counties without any plans, and many more counties with just one option.
The articles mentioned that Trump could call up providers and bully them into offering coverage. But does that make any sense from a party that wants to Kill Obamacare?
The system is set up to implode and there is no point to doing anything until it does. After an implosion, there will be bipartisan support to do something. Right now there is no bipartisan support to do anything.
The folly of House Speaker Paul Ryan’s ill-fated attempt to fix the problem is readily apparent.
His poor decision to attempt to fix the unfixable accomplished nothing useful, but it did move partial ownership of the problem to Republicans.
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