by Kate Randall, from the WSWS
A number of private insurance companies that have not yet sold policies on the Affordable Care Act (ACA) exchanges plan to do so in the coming year. The reason is simple: the health care overhaul popularly known as Obamacare offers a virtually risk-free opportunity for insurers to increase their profits.
Insurance giants such as UnitedHealth Group and Cigna, as well as smaller companies, plan to enter the Obamacare market in 2015 and beyond. “Insurers continue to see this as a good business opportunity,” Larry Levitt of the Kaiser Family Foundation told the New York Times. “They see it as an attractive market, with enrollment expected to ramp up in the second year.”
The ACA was designed from the start as a pro-corporate piece of legislation, boosting the bottom line of the insurance industry. The law’s core component, the so-called individual mandate, requires those without insurance from a government program such as Medicare or Medicaid to purchase coverage from a private insurer in the Obamacare “marketplace” or pay a penalty.
New changes to the legislation by the Obama administration virtually guarantee the insurance companies that any dent in their profits will be offset by a complex system of government funds. The Department of Health and Human Services (HHS) has assured the private insurers that ACA mechanisms already in place will be made fully available to them, if need be at taxpayer expense.
The tweaks were buried in ACA regulations issued late last month and reported May 21 by the Los Angeles Times. Adjustments to key provisions of the legislation, largely unreported in the press, will potentially make billions of additional taxpayer dollars available to the insurance companies if they lose money on the exchanges.
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