Opponents of the Affordable Care Act will no doubt start trashing Obama for destroying jobs, now that Assurant Health insurance is shutting down in Milwaukee:
jsonline-Guy Boulton: The parent company of Assurant Health said Tuesday that it will sell or shut down the Milwaukee health insurer — which employs 1,200 people in the area — by the end of next year. Assurant Health has struggled to adjust to changes in the health insurance market imposed by the Affordable Care Act … The company specializes in health insurance for small employers and individuals, the two market segments that have faced the most changes from the Affordable Care Act. "They are a casualty of the ACA," said Steven Schwartz, an analyst with Raymond James & Associates.
Oh, the horror. But wait, the ugly truth is even more grotesque. Here's how Assurant Health stayed in business:
The Affordable Care Act barred health insurers from turning away customers because of pre-existing health conditions. That new regulation negated one of Assurant Health's strengths: underwriting, or determining which potential customers were the best risks. "That went away," said Schwartz of Raymond James.
Poor babies, not being able to turn away sick people is so unprofitable.
What about the free market dream to compare and shop around, lowering prices? ObamaCare does that too:
Assurant Health's losses suggest that any buyer would have to raise the cost of its health plans next year. At the same time, the online marketplaces set up under the Affordable Care Act have made it easier for people to compare prices and move to different health plans each year.Funny thing, Assurant had a different story when the ACA started up, which proved to be a big, big mistake:
In an interview in 2012, Adam Lamnin, president and chief executive of Assurant Health, acknowledged the challenges the company faced. "Health care reform," he said, "was a watershed event for us."
Assurant Health declined to sell insurance on the Affordable Care Act online marketplace in 2013, and executives with parent company Assurant Inc. say the company gained market share because of the strategy. The higher sales were driven by “significant activity” due to the first open enrollment period under the Affordable Care Act that started Oct. 1, 2013, Assurant Health’s major-medical insurance products for individuals include essential health benefits required by the ACA … In other words, prospective customers could meet ACA's individual mandate by buying Assurant products.
Thanks to the tweet from Gnarlytrombone.
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