Last week, the Washington State Insurance Commissioner’s office released rate filings for health insurance companies for 2018. No company plans to offer health insurance in the individual market in Klickitat and Grays Harbor counties. (here) The left, including a number of elected officials such as Commissioner Kreidler, blame this on the uncertainty of health care reform in Congress.

The real culprit is Obamacare and its perverse regulations and mandates. Insurance carriers have faced a very uncertain market since 2013 when they first designed and priced plans for the Obamacare exchanges.

The Affordable Care Act (ACA) requires that carriers can only charge older, and potentially sicker, people three times what they charge younger, and potentially healthier, people. In addition, the ACA mandates that insurance companies must provide health insurance to anyone regardless of how sick they are. Because of these two requirements, carriers have faced uncertainty and have had a difficult time pricing plans in the Obamacare exchanges. (here)

The Obama Administration estimated that for financial viability, the exchanges would need at least a 40 percent participation rate by younger, healthier people to offset the costs of sicker individuals. To date, the highest percent has been 28 percent. This has caused a downward spiral of more sicker and costlier people signing up in the exchanges and fewer younger people. Premiums have consequently increased, sometimes dramatically, making health insurance even less attractive to healthy individuals.

A spokesperson for Premera even stated that the rising cost in the exchanges was the reason for leaving the two Washington counties.

Regardless of what Congress does with health care reform, the Obamacare exchanges are not financially viable – unless they receive an even larger infusion of taxpayer money. Unfortunately, the demise of the exchanges may drag down the private individual market, as well.