Ricardo Alonso-Zaldivar of the Associated Press (and an apologist for the current occupant of the white house) has written an article about the health insurance rebates mandated by the Unaffordable Care Act, aka Obamacare.  The overall amount to be rebated may top 1 billion, Oklahoma’s share to be about 22 million.  As you open your mail and find these checks try to wrap your mind around one of the most sinister parts of this health care bill, as these rebates are really a smoking gun of government and business, allied together, at its worst.

These rebates are the result of insurance companies’ failure to meet the “medical loss ratio” demands of the Unaffordable Care Act (UCA).  This ratio requires insurance companies to pay in claims 80-85% of what they collect in premiums, no more than the remaining 10-15% to be used for salaries and administrative functions within the insurance company.  Sounds great, doesn’t it!  It is great if you are one of the following:

1)A GIGANTIC insurance company:  10-15% of 100 billion dollars is plenty of money, for instance, to pay administrative functions and giant salaries of the CEO’s of companies this size.  This is a virtual guarantee that these GIGANTIC companies will receive the gift of the total destruction of their smaller competitors.  The SMALL insurance companies will have serious difficulty complying with this.  Fewer players in the insurance market will necessarily drive business to the GIGANTIC players and these “rebates” they are being “forced” to pay will be returned many times in terms of new revenue as small companies fold and their business goes to the giants.  

2)BIG GOVERNMENT:  if your goal is a single payer national health plan this is a big step.  By eliminating the smaller insurance carriers, the entire health insurance market is destabilized and creeps closer to that “no other choice,” “against the wall,” situation that those in government seem to love.  Rather than have government run health care, large carriers will run the government plan, carving the country up into regions, like meat for the wolves.  OK.  Here is the word that I hesitate to use but there is simply no other word for it.  This is fascism.  Professor Robert Higgs uses the phrase “participatory fascism.”  This marriage of government and big business has been called “mercantilism,” or “public-private partnership,” more recently, but this conspiracy between big business and government in health care deserves the term “fascism,” as people’s live are truly at stake here.

Did you wonder why the largest insurance carriers supported the UCA during the “health care debates,” prior to its passage?  Keep in mind they knew about the Medical Loss Ratio provision and these rebates when they supported the bill.  

Late in the AP article, the author refers to certain “exemptions” granted by the feds.  Why do you think some states received exemptions from the UCA, this part of it in particular?  Why do you think that certain labor organizations’ health plans received these same exemptions?  You don’t think that there is any politically motivated quid pro quo, do you?  

I’d like to say that I’m disappointed that the writer didn’t mention any of this in his article.  I guess disappointed but not surprised.

G. Keith Smith, M.D.