Health-insurance giant Aetna announced this week that it will no longer sell ObamaCare policies through exchanges here in Georgia and 10 other states, a decision that will force an estimated 900,000 policyholders throughout the country to turn to another provider.
According to Aetna, the withdrawal is purely business. Those buying insurance through the exchanges have required more medical care than predicted, says Aetna CEO Mark Bertolini, making it difficult to turn a profit. Not surprisingly, opponents of ObamaCare have jumped on Aetna’s decision as evidence that the program’s long-predicted demise has finally arrived.
ObamaCare defenders tell a different story. They claim that Aetna’s decision amounts to political retribution after the U.S. Justice Department decided last month to block its lucrative, $37 billion merger with another insurance giant, Humana. They can also cite some powerful evidence in support of that claim. In a July 5 letter uncovered by Huffington Post, Aetna’s CEO promised the Justice Department that if the controversial merger was approved, his company would expand its coverage into five more states.
On the other hand, “ if the DOJ sues to enjoin the transaction, we will immediately take action to reduce our 2017 exchange footprint.” UPDATE: Adding further fuel to the retribution theory, swing-state Pennsylvania is one of the markets that Aetna has abandoned, claiming it can't make a profit. Yet by its own numbers, it DOES make a profit in Pennsylvania.
I think it’s probable that both stories have some degree of truth. While Aetna’s decision may indeed have been motivated in part by anger at the Justice Department, there’s also no denying that the financial issues raised by the company are real, and that other large insurers report a similar experience.
So what now? In a functional system, the natural response to problems like this would be to fix the problems. Human beings have done this kind of thing — see problem, fix problem — for millions of years, and we are perfectly capable of doing it this time too.
But here’s the catch: Our mechanism to fix problems of this sort is itself broken. We have a useless Congress that has voted some 60 times to repeal ObamaCare but it has yet to draft, let alone vote upon, a single proposal to replace it. We have a Congress that under current leadership would rather destroy the system, stripping health insurance from tens of millions of their own constituents — children, grandparents, cancer patients, accident victims — than enact somewhat simple corrective measures.
The fact that such adjustments are needed seven years after ObamaCare’s passage isn’t evidence of failure. It’s inevitable, because nobody gets it right the first time. Medicare required legislative adjustments; Social Security required legislative adjustments. Back in the early ’80s, when Social Security faced serious issues, House Speaker Tip O’Neill, a Democrat, worked with President Ronald Reagan, a Republican, to fix it and put Social Security on a more secure financial footing.
In the private sector, our computers today run on Windows 10 and Apple’s Version 10.12 because previous versions had to updated and expanded and because unpredicted glitches arose that had to be fixed. It is simply impossible to identify all of the weaknesses of any product, system or organization until it is released out into the wild and forced to function under real-life conditions.
So if Congress can’t fix it, I guess we need a new Congress.