From The Progressive Populist.
Republican misleaders were disappointed on June 25 when Obamacare survived another right-wing challenge, as the Supreme Court on a 6-3 vote ruled that an apparent drafting error in a reference to the statewide health exchanges did not invalidate the subsidies the Affordable Care Act provides to help 6.4 million lower middle-class Americans buy health insurance.
But Republicans, unwilling to make peace with Obamacare, now blame the health reforms for a series of healthcare mergers, saying that new regulations make it tougher for smaller companies to survive.
The biggest proposed merger is a $35 billion deal announced by Aetna and Humana on July 3. The new company would include 33 million members, or roughly 13% of people with health insurance in the US.
The turn toward consolidation is also worrying smaller providers, which fear they might lose leverage to the larger insurance companies, Sarah Ferris noted at TheHill.com (July 8).
Aetna and Humana are two of the nation’s five biggest health insurers, a group that includes UnitedHealth Group, Cigna and Anthem. Each of the companies have been eying the others for months, exploring potential takeover bids as they navigate the new rules and markets under the Affordable Care Act, Ferris reported.
In June, Anthem Inc. announced a massive $47 billion offer to buy Cigna, which so far has rejected the buyout. July 2, a $6.3 billion deal was struck between two smaller insurers, Centene Corp. and Health Net Inc., which would leave the new company with 10 million members and $37 billion in revenues.
The merger activity is fueling new attacks from Republicans, who believe it supports their longtime claim that the healthcare law would drive up premiums.
Senate Majority Misleader Mitch McConnell (R-Ky.) blasted the proposed takeover of Louisville-based Humana as “the inevitable result of Obamacare’s push toward consolidation as doctors, hospitals, and insurers merge in response to an ever-growing government.”
Still, Edmund Haislmaier, a senior health research fellow at the conservative Heritage Foundation, urged caution when pointing to Obamacare as the sole cause of consolidation.
“You have to be careful not to over interpret it. A lot have other factors involved,” he told The Hill, adding that companies have been looking to trim costs and expand their footprint long before the Affordable Care Act.
The mergers should be fully examined by the Federal Trade Commission and the Department of Justice, and health insurance premiums still are regulated under the ACA. But if Republicans really are concerned that consolidation might harm consumers, there is a simple fix: Allow individuals and businesses to buy into the Medicare system as a public option.
The Congressional Budget Office in November 2013 found that a public option based on Medicare would reduce the deficit by $158 billion through reduced spending and increased revenue—and it would lower premiums for millions of regular Americans and businesses by 7 to 8 percent during the 2016-2023 period, compared with premiums for private plans. CBO estimated that 35% of the people who would get insurance through the exchanges—either individually or through an employer—would enroll in the public plan.
It’s so easy, and makes so much sense that Republicans will never let it happen.
See the Editorial at The Progressive Populist. Reposted with permission.