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InsiderOnline Blog: May 2014

Death Spiral Update

Eight million nineteen thousand seven hundred and sixty-three people have enrolled in a health care plan through the ObamaCare exchanges, according to the latest figures from the Department of Health and Human Services. Those sign-up totals are now the measure of ObamaCare success for liberals. Not whether people actually like the plan they were forced to buy. Not whether they’ll be able to get the care they need. Not how fast premiums will now go up.

HHS also tells us that 3.8 million of those enrollees signed up in the last month of the enrollment period. That means 48 percent of those in the program love it so much that they waited until the last moment to sign up. David Hogberg breaks down the numbers further:

Sign-ups of the crucial 18-34-year-old cohort jumped from 25% in early March to 28% at the end of the enrollment period. That’s not a surprise given that young people are likely to be disporportionately represented among people who do things at the last minute. But the fact that over half of that age group chose their plan during the last month should worry ObamaCare supporters. People who are flakey enough to wait until the last minute are probably also flakey when it comes to paying premiums. Thus, that 28 percent number will decline and it will, of course, be no where near the 38 percent the Obama Administration says is needed to keep the risk pools stable. […]

While the 18-34-year-old cohort has been dubbed the “young and healthy,” a more accurate moniker might be “young and somewhat healthy.” 68 percent of 18-34-year-olds on the federal exchanges chose a silver plan. [Amy Ridenour’s National Center Blog, May 1]

As Hogberg goes on to explain, Bronze plans are cheaper. You only come out ahead from buying the Silver plan if you expect to need health care during the coming year. What group of people expect to need health care in the coming year? Those who have a pre-existing condition or are currently sick. If the insurance pool is sicker than expected, premiums will have to go up next year. That, in turn means insurance will become an uneconomical proposition for even more people. Where this process leads is the collapse of health insurance for everybody—sick and healthy.

Posted on 05/02/14 04:55 PM by Alex Adrianson

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