Krauthammer: Insurance Companies Ruined By ObamaCare Will Need a Bailout Next Year
Syndicated columnist Charles Krauthammer made a dire prediction Sunday.
Appearing on Fox News Sunday, Krauthammer said that all the exemptions the President has given to ObamaCare will ruin insurance companies thereby necessitating the White House to ask for a huge government bailout of these companies next year that Republicans in Congress should prevent (video follows with transcript and commentary):
CHRIS WALLACE, HOST: I want to go back to this point that George was talking about, because the President in his news conference Friday said that none of these problems get to the core of ObamaCare - you can argue whether that’s true or not, but that’s what he said - and that 85 percent of Americans that benefited from the benefits that you get under ObamaCare. Charles, your reaction to that, and is it possible that for all of the problems so far that they can get this worked out, and as we get – just to pick a month at random – by next November, most people are saying, “You know what, ObamaCare’s okay?”
CHARLES KRAUTHAMMER: It’s possible, it’s highly unlikely. One of the things that he did, one of the reasons that this strikes at the heart of ObamaCare is that what he has done is to take away the financial structure underneath it. The reason the insurers are apoplectic about what just happened is because he has now told a whole class of people, “You don't have to be in the exchanges.” And these are people that are probably the healthier and the younger ones who are going to be outside of the exchanges. Which means that the cost to insurers of people left in the exchanges is going to be exorbitant. And there’s also no way he’s going to be able to hold the line on this because of the unfairness.
If you're exempting people who didn’t have, who had insurance and were cancelled, and you’re exempting them from the fine and the requirement of getting insurance, there’s no way you can require, fine people who didn’t have insurance in the past. So you’re going to have an abolition of the individual mandate. You’ve already abolished or postponed the employer mandate.
The insurers understand that they are going to be ruined. And what’s going to happen as a result of this? There’s only one way out: a huge government bailout of the insurers waiting at the end of next year, and that’s an issue that Republicans ought to focus on right now. It's the only way that ObamaCare’ll survive, and it ought to be stopped before it happens. It ought to be, Congress ought to say, “No bailout,” particularly because this isn’t a natural disaster, it's a manmade disaster.
I'm not sure I agree with Krauthammer on this one.
It seems far likelier that the overwhelming majority of ObamaCare enrollees are for Medicaid. The early numbers show upwards of 80 percent of applicants are qualifying for such assistance.
As a result, the burden will initially be on the federal government, but will be transferred to the states with the passage of time.
Contrary to what the liberal media have claimed concerning this issue, that's why so many of the states opted not to take federal funds for Medicaid expansion under ObamaCare because they knew that assistance was temporary and that they'd eventually be responsible for financing healthcare for these added recipients.
As such, the additional cost to insurance companies though large may not be so burdensome that they need a bailout to survive.
What seems more likely is that they'll just raise premiums on all of their policyholders thereby completely destroying the whole premise of ObamaCare.
Whatever the case, it seems almost a metaphysical certitude that the train wreck called the Affordable Care Act will continue to worsen after the New Year, and there's nothing the President can do about it.
*****Update: As NewsBusters reported earlier this month, 65 percent of Americans oppose such a bailout.