Monday, October 03, 2016

Washington Post Botches Defense of Obama's Insurer Bailout

The Truth About Obamacare's Risk Corridor Program

"In his latest assault on the separation of powers, President Obama seems poised to take unilateral executive action—in direct defiance of legislation he signed—to bail out insurance companies under Obamacare. In its above-the-fold story on Friday, the Washington Post mischaracterizes Obama's power grab in two important ways: First, it claims that the bailout money is merely what the government owes insurers and what the insurers are owed. Second, it claims that the program in question originally was not supposed to pay for itself, until Republicans altered it. Each of these claims is false.
Obamacare's risk corridor program was designed to redistribute money in the Obamacare exchanges from health insurers who made money to those who lost money. Profitable insurers would pay in; unprofitable insurers would get paid out. With so many insurers losing money under Obamacare, however, the program was positioned to become a bailout, as there was no guarantee in Obamacare's text that the money paid out wouldn't exceed the money paid in."

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