After a tense week, it looks like Connecticut’s insurance exchange is saved. Don’t breathe that sigh of relief just yet, though. It’s more obvious than ever that the exchanges are fatally flawed.
ConnectiCare sure took us for a ride these past few weeks. First they unexpectedly jacked up their requested rate increase for Access Health CT customers, then they threw a fit and threatened to leave the exchange when they didn’t get it, only to end up back with the exchange at a rate not much higher than their original request.
Whether ConnectiCare’s bluff was called and they folded, or whether this was all a weird scheme to get slightly higher rates than they originally requested, the whole escapade demonstrates the fatal weakness of the insurance exchanges — they depend on the good will of insurance companies.
ConnectiCare’s brief flirtation with leaving the exchange was a clumsy affair, to be sure. But during those few days we were all suddenly faced with the possibility of an insurance exchange with a single carrier — Anthem.
An exchange with a single carrier isn’t so much an exchange as a hostage situation. If Anthem, which had already requested massive rate hikes, had been the only carrier left, that would have given them enormous power. They could demand whatever rate hike they wanted or else they would completely torpedo the exchange by pulling out. Regulators could be forced to choose between approving agonizing rate hikes or killing off what was once called the best exchange in the entire country.
It isn’t just Connecticut that’s faced with this problem. Health insurance companies are exiting the exchanges nationwide, and there are very few states that are not affected. Four states will have only one carrier in 2017. A county in Arizona has none.
It wasn’t supposed to happen this way. Obamacare does have a backup plan which calls for the government to contract with several insurers that would operate in all 50 states, but that plan is way behind schedule, and only Blue Cross Blue Shield has been willing to participate so far. That leaves plenty of people with very little choice for insurance — or no choice at all.
It’s a tragedy that the exchanges aren’t working as intended, because they are vitally important. For a lot of people, the exchanges are a godsend. The coming of health insurance that isn’t tied to employment has allowed many who couldn’t even dream of coverage before to actually access it. That was the whole idea of Obamacare, to make certain that everyone had access to coverage and to health care. But Obamacare doesn’t exist without the exchanges, and the exchanges are dying.
We can’t let this happen. I love the exchanges, and I use Access Health CT, but it’s clear to me that they don’t work the way they are currently constituted. Insurance companies, which are all driven by the bottom line, can come and go as they please. Rates are unstable, and competition is increasingly scarce. The exchanges need to be reformed, but how?
The first thing we could do is try to tweak the laws to make the exchanges more competitive, and to keep them from failing.
For instance, right now citizens are required to prove they have health insurance, or face a fine. We ought to do the same for insurance companies. Either participate in the exchange, or face fines that will go toward supporting the other companies on the exchange.
We could also expand the government subsidies available for the poor to the middle class, where most of the plans exist now. This would offset some of the rate hikes, and make health care more affordable for those who need it.
We could also finally implement the public option that Sen. Joe Lieberman killed all those years ago. If the federal government won’t, maybe Connecticut will.
Or we could admit that yes, we tried a free market solution, and it didn’t work. We tried setting up a real marketplace where consumers could buy plans just like in other industries, and, thanks to whims of the insurance companies, it isn’t going to ever be what we want.
So let’s scrap them, and do what we should have done in the first place.
Let’s expand Medicare, which is single payer, government-run health care for the elderly, to cover everyone. Let the insurance companies wither and die on the vine. Let them face an uncertain future where their health is certain to decline, and no one will extend a helping hand.
It would serve them right.
Susan Bigelow is an award-winning columnist and the founder of CTLocalPolitics. She lives in Enfield with her wife and their cats.
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