Insurance Companies Rush to Enter Obamacare in Year 2

Insurance Companies Rush to Enter Obamacare in Year 2

For a plan that imposes regulations too burdensome and puts a boot (black, of course) on the necks of our beloved health insurance companies that are really the consumer loving victims of big, bad Obamacare, those same insurance companies are rushing to claim a piece of the Obamacare pie. After the first open enrollment period concluded for the Affordable Care Act exchanges with success and participation beyond anyone's wildest dreams, apparently the insurance companies that decided to sit out the first year are thinking twice.

In every state that has reported so far, the number of insurance companies signing up for their exchanges is going up. Reports The Daily Briefing:

In every state that's shared details thusfar, it appears there will be more choices in Obamacare, year 2:

  • Michigan's exchange is going from 13 participating companies in 2013 to 18 this fall.
  • At least one additional carrier has filed to sell plans through Kentucky's exchange.
  • Several more insurers may join the plans participating in Virginia, Washington, and Indiana's exchanges.
  • United HealthCare may jump into Georgia's market.

Represented graphically:

And that's not all. Just as the states are getting more insurers to join, choices of plans offered are going up at an exponential rate. For example:

And the surge in carriers means that there will be many more actual options at the point of purchase, too. Peter Frost at the Chicago Tribune notes the number of companies competing on the Illinois exchange next year will inch up from six to eight—but the number of available policies will almost triple, from 165 to 504.

Yes, insurance companies who sat out the first year would please like their piece of the generous federal subsidies provided to poor and middle class families to purchase health insurance. Because you can't argue with higher revenue.

And because you can't argue with higher revenue, Republicans will find it impossible to repeal Obamacare. Insurance companies, good Samaritans that they are, will not let the party they bought and paid for take a cut out of their revenue just so there can be a Teabagger revolution.

In practical terms, the surge of entry of insurance companies to Obamacare exchanges shows several things:

  • The Affordable Care Act exchanges have become the marketplace the law intends them to be, where Americans who do not have employer insurance go to buy their insurance.
  • Choice and competition in the market is going to get more pronounced in year 2, putting further downward pressure on the price of health insurance. Already, prices in Obamacare exchanges have come in below projections for the first year. A corollary to this: the Republican wet dream of the markets collapsing under their own weight as insurance plans become unprofitable is transforming into their worst nightmare of Obamacare working exactly as intended or better.
  • And to the dismay of our friends on the single-payer-or-bust Left, a truly competitive and well regulated marketplace for health insurance seems to be working quite well in the big picture - on both the coverage and cost fronts.

In short, despite being the media's go-to nontroversy of the Obama era, the Affordable Care Act is a shining example of what non-ideological, pragmatic, progressive legislation can achieve for ordinary Americans. It is the best case for compromise with an eye towards progress in public policy in modern American policymaking. And it will be among the primary reasons history will judge Barack Hussain Obama to be one of America's most consequential and transformative presidents.

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