For three years now, Americans living with pre-existing, potentially deadly medical conditions have been able to get insurance without fear.
Young people, jobless and sinking in student loan debt, have been able to stay on their parents’ health insurance plans a little while longer. And poor people who would otherwise go to emergency rooms have actually been able to make appointments with physicians and get preventive care.
This is the new normal brought to you by the Affordable Care Act. (Thanks, Obama.) But without a concerted effort to stem the bleeding of insurers abandoning President Barack Obama’s signature domestic program, it won’t be for long.
Last week, Aetna Inc. said it would leave Obamacare insurance exchanges in 11 of the 15 states where it currently sells coverage. It follows similar defections by UnitedHealth Group and Humana Inc.
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There are reasons to be alarmed. The more insurers that drop out, the more expensive and limited insurance will become because there will be less competition. Many companies say they plan to seek rate increases of at least 10 percent next year.
The insurers’ beef is that they’re losing money. While millions of Americans have signed up for coverage, the companies say they haven’t been able to enroll enough young and healthy people to offset the high cost of covering sick people.
Aetna has been so brazen about this that CEO Mark Bertolini, citing financial losses, warned in July that it would pull out of the Obamacare exchanges if the U.S. Department of Justice challenged its deal to buy rival Humana.
“By contrast,” he wrote in a letter obtained by The Huffington Post, “if the deal proceeds without the diverted time and energy associated with litigation, we would explore how to (support) even more public exchange coverage over the next few years.”
So far, California has been been spared from such shady ultimatums and drama. Every consumer can choose from at least two plans on our exchange. More than 90 percent of people can choose from three plans and, in some areas, they can pick from six.
Although Aetna doesn’t deal with Covered California, the cumulative impact of defections could have implications here. If insurance companies keep leaving Obamacare, the program nationally could be undermined in years to come.
In the short term, the defections are sure to hurt people living in sparsely populated rural areas, including in the 19, mostly Republican-run states that have refused to expand Medicaid, despite the clear benefits to public health.
The Kaiser Family Foundation predicts that, for people in one in five U.S. counties, the offerings on the exchanges will be down to one insurer by next year.
This is the reality of dealing with a profit-driven private market. But far from a reason to repeal and replace Obamacare, it’s a reason to improve it. This will be a major job for the next president and Congress.