Using Taxpayer Money To Delay Insurance Increases Until After 2015

The Daily Caller posted a story today about the possibility of the Government having to bail out insurance companies because of the lack of participation by young people in ObamaCare.

The problem is that young people are not signing up for ObamaCare. The article reports:

While there’s still time for young adults to sign up, the Obama administration has a lot of ground to cover in just two months. If not, a bailout via the “risk corridor” provision could offer a temporary fix.

“If [a bailout] does occur, it’s certainly going to hold down the size of the premium increases next fall and the year after,” Tanner told TheDCNF, “but the bailout only goes until about 2016 — so in 2015 we can begin to see significant increases” in the amount Americans pay for their health care costs on Obamacare exchanges.

The risk corridor program would partially reimburse insurers for losses only through 2016, allowing the underlying problem to come out in full force during the presidential election season.

The article states that the bailout’s cost to taxpayers could run as high as $25 billion, but that would only delay the rise in premiums until the election campaign season. It will be interesting to see how the Obama Administration handles this problem–the bailout will show the problem with ObamaCare regarding actuarial figures. Insurance companies base their premium costs on actuarial tables that calculate risk and allow the companies to make enough money to stay in business. If insurance companies do not make money, they do not stay in business. Subsidizing insurance companies for two years does not solve the actuarial problem–it simply delays it. The Republicans need to come up with a better way to help Americans get insurance–without a government takeover of the insurance industry.

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