Pirate's Cove

Well, that’s strange, don’t you think? Of course, don’t cry any tears for BCBS or any other insurance companies that willfully, enthusiastically, and wholeheartedly embraced the Affordable Care Act

(Raleigh N&O) Blue Cross and Blue Shield, the state’s largest health insurer, said Friday that it posted its first financial loss in 15 years as a result of insuring high numbers of older and sicker people under the Patient Protection and Affordable Care Act.

The Chapel Hill organization signed up 257,704 people under the federal health care law, which requires insurers to provide coverage regardless of a customer’s health condition.

New enrollees last year swelled Blue Cross’s covered membership to 3.91 million people, and boosted revenue by 25 percent to an all-time high of $8 billion.

But steep medical claims – for hip and knee replacements, heart procedures, specialty drugs and other costs – drove up medical claims from $5 billion in 2013 to $6.4 billion in 2014. Blue Cross also paid $156 million in ACA-related fees, a new cost for the company.

As a result, Blue Cross posted a loss of $50.6 million last year, compared to net income of $92.6 million in 2013. It’s the first annual loss for Blue Cross since 1999.

One thing BCBS notes is that the people they were signing up were older and sicker. The pool of new enrollees who were younger and healthier did not materialize, just like with most Exchanges.

The architects of the ACA foresaw a surge of sicker customers and created an insurance pool to cover losses for affected insurers. Blue Cross plans to seek $120 million from the pool this year and booked $60 million in pre-tax revenue it expects to collect in the coming three years.

I’ll admit, that’s the first time I’ve truly heard of this deep pool. Weren’t the younger and healthier supposed to cover that? Apparently, said architects knew that what they were actually telling the public was a load of mule fritters.

Of course, opponents of the ACA noted that with this “free” and “cheap” health insurance people would use it willy nilly, increasing costs, and shifting the costs to the American taxpayer even more.

Meanwhile, Politico runs an article by Abbe R. Gluck about King v Burwell, which complains that the suit is really about States Rights, which is a bad thing or something

King v. Burwell—the challenge to the Affordable Care Act that the Supreme Court will hear on March 4th—is about more than health care. Court watchers have finally begun to realize that the case is also all about states’ rights. And while the challengers have tried to submerge this issue—because it dramatically undermines their case—its centrality to King has become undeniable.

The challengers maintain that the case is simply about reading plain language. (I have detailed elsewhere why their hyper-literal reading of four words out of context is anything but plain and is not how the Supreme Court usually reads statutes.) But King is about a lot more than this. The case is about federalism—the role of states in our national democracy. The reason the challengers don’t want anyone to realize that is because the very text-oriented justices to whom they are appealing are the exact same justices who have consistently interpreted federal laws to protect states’ rights. And the challengers would read the ACA in the opposite way—as having devastating implications for the states.

Or, it could simply be about one of the most lopsidedly passed bills in U.S. history, which passed without one Republican vote, was not read by those who voted to pass it, and, furthermore, those “four words” being exactly in context of what the architects wanted, to force States to create their own exchanges.

If this was primarily about States Rights, they could file a suit which follows the 10th Amendment, which specifically would stop the ACA, since it is not a power delegated to the Federal Government. Leftists, though, do not like States Rights, because they love the notion of a Central Government dictating everything.