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Forbes Magazine: The White House Is Bribing Health Insurance Companies

by BZ ⒾAM Riger / Thursday, 17 July 2014 / Published in Absolute Data

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The White House Is Bribing Health Insurance Companies

By Tim Phillips, published on Forbes Magazine, on July 14,2014

 

 

Want to know what’s happening with Obamacare? Good luck finding out. The White House recently adopted a new approach for updating Americans on the country’s most consequential law. I call it the “needle in a haystack” method: Bury the announcement in hundreds of pages of regulations and hope no one finds it.

The White House tried a test run several weeks ago. Hidden in the midst of a 436 page regulatory update, and written in pure bureaucratese, the Department of Health and Human Services asked that insurance companies limit the looming premium increases for 2015 health plans. But don’t worry, HHS hinted: we’ll bail you out on the taxpayer’s dime if you lose money.

No wonder there wasn’t a press release. The White House is playing politics with Americans’ health care—and they’re bribing health insurance companies to play along.

The administration’s intention is clear: Salvage the 2014 midterm elections. Typically, insurance companies release their premium rates between summer and early fall—i.e., right before voters cast their ballots in November. If premiums skyrocket—which looks increasingly likely—then voters won’t look too kindly on Senators and Representatives who voted for Obamacare and created this problem.

Hence the White House’s desperate damage control. It almost worked: No one noticed when the regulations were first released. In fact, it took days for any news outlet to find the language and then translate it into readable English. TownHall.com figured it out first. The Los Angeles Times then reported that “hold[ing] down premium increases for next year” is a “top priority” for President Obama since “rates will be announced ahead of this fall’s congressional elections.” If there were a Pulitzer Prize for understatement, the Times would have won it.

But the White House may still get away with its attempted sleight of hand. Technically, the regulations don’t force health insurance companies to tamp down their premium spikes. But the White House isn’t asking nicely.

The administration knows that insurance companies owe it. Obamacare’s architects made sure that these companies would be invested in the law’s success. The individual mandate is proof. It could bring insurers some 25 million new customers, according to the Congressional Budget Office. Each new customer comes with the monthly premiums that boost the industry’s bottom line. No wonder analysts now predict that the five major health insurance companies will see their profit margins increase by hundreds of millions, or even billions, of dollars in the next few years.

Even if they don’t want to play along, it’s still in these companies best interests to assent to the administration’s “request.” Under Obamacare, insurers are so heavily regulated that they have to play nice with the bureaucrats who call the shots. The President isn’t the only government official who carries a big stick.

If insurance companies don’t give in, regulators have powerful ways to make life hard for them. A shrewd CEO doesn’t need to look far to see what might happen if his company opts out. This administration already has a reputation for strong-arming dissenting businesses in other industries.

To be fair, this isn’t the first time that the White House has rewritten Obamacare in order to save electoral face. Several months ago, HHS quietly delayed the individual mandate for three years for anyone whose plan was canceled last fall. No surprise there: The unwitting victims of the President’s broken promise that they could keep their health care plans wouldn’t stay silent if they were then hit with Obamacare’s tax penalty for not having health insurance.

These may not be the only examples where the administration has lawlessly rewritten Obamacare without letting the American people know. The law created at least 11,000 pages of new regulation, with more added every day. The White House got caught this time—but they’ll have plenty of other chances to hide the truth.

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