This May Mark the Beginning of the End for Obamacare
19th April 2016
The Congressional Budget Office initially projected that Obamacare would have more than 20 million enrollees by 2016. As of the end of the 2016 calendar year enrollment period, there were “about 12.7 million” enrollees, per the Centers for Medicare and Medicaid Services. This massive shortfall in expected enrollees has left insurers, both national and regional, working with fewer enrolled patients, many of which have been shown to be costlier and sicker compared to consumers who are covered by employer-based health plans.The Congressional Budget Office initially projected that Obamacare would have more than 20 million enrollees by 2016. As of the end of the 2016 calendar year enrollment period, there were “about 12.7 million” enrollees, per the Centers for Medicare and Medicaid Services. This massive shortfall in expected enrollees has left insurers, both national and regional, working with fewer enrolled patients, many of which have been shown to be costlier and sicker compared to consumers who are covered by employer-based health plans.
Making matters worse, many of the dynamics that insurers had been counting on (aside from higher enrollment totals) haven’t played out.
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The failure of the “risk corridor” has also been a disappointment. In simple terms, the risk corridor was a fund that profitable insurers on Obamacare’s exchanges were expected to pay into. This cash would then be distributed to struggling and/or new Obamacare plan insurers to help prevent excessive losses from mispriced premiums. In 2016, the risk corridor wound up being underfunded by more than $2 billion, leading more than half of Obamacare’s approved healthcare cooperatives to shut their doors.