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In reply to the discussion: When does ACA become a "failure"? [View all]Romulox
(25,960 posts)33. I said they may require a cash infusion this year. Your link confirms it. What are you arguing?
If the market ends up imbalanced, how does Obamacare address that?
The ACA provides for what are called the three Rs reinsurance, risk corridors, and risk adjustment. Reinsurance is a pot of money, funded by a tax on every health plan, that helps insurers cover the costs of expensive claims. Under a recent rule change, reinsurance would pay 80 percent of the cost of claims over $45,000, down from $60,000. The ceiling is $250,000.
The program called risk corridors, available only to insurers on the new exchanges, exists to even out premiums. If an insurer takes in more than it ends up needing, it gives some of the excess to the government. If its premiums end up being too low, the government will cover some of the losses.
The risk adjustment program takes money from insurers that had healthier-than-average customers and gives it to insurers with more-expensive customers. That removes the incentive by insurers to recruit only healthy customers.
The first two risk mitigation programs are in effect for three years, 2014 to 2016. Risk adjustment is permanent.
The ACA provides for what are called the three Rs reinsurance, risk corridors, and risk adjustment. Reinsurance is a pot of money, funded by a tax on every health plan, that helps insurers cover the costs of expensive claims. Under a recent rule change, reinsurance would pay 80 percent of the cost of claims over $45,000, down from $60,000. The ceiling is $250,000.
The program called risk corridors, available only to insurers on the new exchanges, exists to even out premiums. If an insurer takes in more than it ends up needing, it gives some of the excess to the government. If its premiums end up being too low, the government will cover some of the losses.
The risk adjustment program takes money from insurers that had healthier-than-average customers and gives it to insurers with more-expensive customers. That removes the incentive by insurers to recruit only healthy customers.
The first two risk mitigation programs are in effect for three years, 2014 to 2016. Risk adjustment is permanent.
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It's too bad that there aren't many (any?) people in the House/Senate speaking so sensibly
Proud Liberal Dem
Mar 2014
#15
If the ACA doesn't meet the projected actuarial standards, it will need an infusion of $$$$$.
Romulox
Mar 2014
#9
No. By next year. Resets to rates happen for following year starting Dec.
functioning_cog
Mar 2014
#23
Rate increases aren't the only source of ACA funding. Insurers are entitled to gov't subsidy any
Romulox
Mar 2014
#30
link please. they don't get wads of cash from the US government up front just because.
functioning_cog
Mar 2014
#32
I said they may require a cash infusion this year. Your link confirms it. What are you arguing?
Romulox
Mar 2014
#33
my bet is that any net loss across all states and all insurers will be immaterial
functioning_cog
Mar 2014
#35
I'd give it a year and see if people are getting the health services they need.
Jesus Malverde
Mar 2014
#13
Yes, I think so, as I understand it goes into effect for people at or above the poverty level.
HereSince1628
Mar 2014
#38