I was fortunate enough to have a conversation today with one of the country's foremost insurance product experts. She is responsible for the actuarial analysis and design of life and health care products.
She was commiserating about the difficulty of working with state exchanges: in her opinion, it is virtually impossible to find out which companies are going to offer products in the state exchanges.
Remember, enrollment starts on October 1st, so this is a crucial problem for the exchanges. The vast majority of states won't disclose which carriers will participate or, crucially, whether any carriers have even elected to join.
And which consumers are supposed to participate in the state-run exchanges? The intent is to provide affordable coverage for those who are uninsured or for employees who don't receive health insurance through their employer.
Fatal Flaw 1 - When Underwriters are Outlawed, Only Outlaws Will Have Underwriting
In other words, since the insurers are forbidden from underwriting (i.e., the backbone of insurance), they will avoid the state exchanges to decrease their risks.
It is therefore likely that the exchanges in many states will be stillborn, with very few insurers participating.
Fatal Flaw 2 - Health Insurance Is Not the Same as Getting Treated
The other problem with the state exchanges, she said, is that people will assume that health insurance is the same as getting treated for health problems.
What if, she asked, you buy a Bronze policy from a small insurer in your state, and find out their network of providers is exceptionally small? You want to see a specialist for a bad knee and you're told you'll need to wait six months?
This is precisely what happens in Canada and the U.K. The expert says that those health care systems do a fine job with the easy, basic tasks of medical care, but specialties must be rationed because central planning can never work as efficiently as a market-based system.
She believes a significant percentage of the population will be outraged when they see firsthand how little treatment they are able to get from the exchanges.
Executive Summary: Obamacare is an Untenable Ruse Designed to Lead to Single-Payer
By removing competition, by designing products for insurers, by prohibiting underwriting, by instituting price controls (e.g., mandated medical loss ratios), she believes that the health care industry as it stands today is doomed.
Obamacare isn't going to collapse, in her opinion, it's going to destroy the health insurance industry and transfer even more control to the federal leviathan. Obamacare is a ruse designed to collapse private insurance.
Scared yet? You should be.
Contract your House Representative now and demand they de-fund Obamacare. The Framers gave the House the power of the purse for a reason: to check and balance an out-of-control Executive Branch.
And that's precisely what we have today. Call your representative now. The clock is ticking on our health care system and lives hang -- literally -- in the balance.
Cartoon: A.F. Branco at CDN.