Monday, March 18, 2013

Obamacare Exchanges Sticking it to the States

Remember when President Obama promised that your insurance premiums would decrease if his “Affordable Health Care Act” was passed?  Well, as we are all becoming painfully aware of, cost are increasing.  And what about those states that refused to setup exchanges in lieu of a federally operated one?  Guess what?  The Obama administration figured a way to stick it to us.  Here is how the feds screwed North Carolina.
“Insurers would pay $181 million in fees to fund the operation of a federal exchange,” said Kerry Hall, spokeswoman for the Insurance Department. “The insurers would pass those costs on in some form to consumers. … It’s not state dollars.”

Proposed rules the federal government issued in November “indicates that a federal exchange would charge insurers who are participating in the exchange 3.5 percent [monthly] for premiums,” Hall said. That money would be used to pay administrative costs for the Obamacare exchanges, and the percentage is subject to change by HHS.

The state plugged that 3.5 percent number into previous cost-projection studies that estimated the number of uninsured people in North Carolina who would be required to purchase insurance under Obamacare, Hall said. From that, analysts determined overall fees paid by the insurance market would be $181 million.

“We’ve also done some analysis with the best information that is available” to determine how much it would cost to operate a state-based exchange, Hall said. “It might be closer to $90 million or $100 million, so roughly half the cost of a federal exchange.”

However, she acknowledged, “It’s a fuzzy estimate, but from everything we’ve seen we’re confident it would be less than a federal” exchange, and the state did its best to analyze cost differences.

“There really are too many unknown factors to come up with a great number” because of the many ways a state exchange could be designed, differing levels of customer service in each state, and what individual state governance would be, Hall said. “It’s not an apple-to-apple comparison, so you have to take our estimates with a grain of salt.”

Hypothetically, she said, a state-run exchange could use the same approach in affixing fees on insurance companies that take part in the online marketplace that would be established. Obamacare mandates that uninsured people must buy insurance. Those not eligible for Medicaid under Obamacare’s expanded income guidelines would buy policies from the exchange.

States also could appropriate money through their general funds or raise revenues by placing advertising on the online exchange, Hall said. The source of money would depend totally on how the state exchange was set up.

Had North Carolina pursued a state-operated exchange, the state Insurance Department would have administered the program. On Jan. 17 the federal government awarded grants of $12.2 million and $73.9 million to establish the exchange.

Notice the stipulation that administration fees are subject to change by the Department of Human and Health Services.  I’m sure they’ll change as frequently as a bureaucrat adds a regulation.  Get ready for a huge sticker shock in 2014, state ran or not. 

Obamacare is a nightmare and it hasn't even been implemented yet.  What a liar!

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