EDITORIAL: If Obamacare is a train wreck, it's a train wreck of Rubio's making

Dec. 16--Florida Sen. Marco Rubio is boasting that he's killed the Affordable Care Act.

His declaration late last month that he's delivered a final blow to President Barack Obama's health care reform law is more a wish than the truth. But the Florida senator "has actually done something toward achieving that goal," The New York Times reported last week.

While Rubio hasn't killed the Affordable Care Act -- enrollments this year are already outpacing last year's -- the GOP presidential candidate has managed to undermine a temporary provision in the health care law that's set up to temper the instability inherent in the first years of a health insurance market with millions of new customers, new requirements for health insurance plans and no history to help insurers set premium levels that match health care costs.

A provision Rubio pushed for in last December's comprehensive budget bill that again made it into the 2016 spending accord reached Tuesday night bars the Obama administration from tapping alternative sources to fund the health care law's "risk corridor" program. That program transfers money from profitable insurers selling plans on Obamacare's online exchanges to other insurers so they can partially cover major losses in Obamacare's first three years.

Many of those insurers ran up losses in the first year of a health insurance market, in which everybody has to sign up for insurance, insurers can no longer turn away patients because of pre-existing health conditions and insurance plans must meet more stringent coverage requirements while limiting consumers' out-of-pocket costs. Risk corridor payments were one mechanism meant to mitigate those losses so insurers wouldn't drop out en masse.

A graphic by the American Academy of Actuaries illustrates how risk corridors work under the Affordable Care Act.

Graphic courtesy of the American Academy of Actuaries.

But when the federal government calculated insurers' risk corridor payments in October, it revealed that profitable insurers had only paid in enough to cover 12.6 percent of the amount owed to insurers that lost money last year. The Rubio provision ensures the federal government can't use money from other parts of the budget to cover those payments.

The Florida senator's move has made life harder for dozens of insurers offering individual and small-group health plans on the Affordable Care Act's online exchanges and, in particular, for many of the nonprofit insurers created under the law to serve an expanded market of people seeking health coverage. So far, 12 of those 23 nonprofit insurers nationwide have closed their doors, with a number of them citing the risk corridor situation as a factor.

The Kentucky Health Cooperative, for example, qualified for a $77 million risk corridor payment based on its first-year losses after enrollment exceeded the nonprofit's original projections by 70 percent. The federal government said in October it could pay only $9.7 million of the $77 million owed; the insurer announced soon after it would shut down.

The two Maine insurers that offered plans through HealthCare.gov fared better. Community Health Options, the nonprofit Lewiston insurer that claimed more than 80 percent of Maine's exchange business, was profitable and paid more than $2 million into the risk corridor program. Anthem BlueCross BlueShield hit its 2014 targets for the individual market; it didn't pay into the risk corridor program, and it didn't qualify for payments to cover losses.

But Community Health Options posted its first quarterly loss earlier this year and announced it would stop accepting new individual insurance enrollments after Dec. 26. The risk corridor situation wasn't a factor, according to Michael Gendreau, the cooperative's outreach, education and communications director. But since Rubio's restrictions on the program will continue, Community Health Options may not be able to collect all it's owed in the future.

Rubio, meanwhile, joins many Republicans in calling Obamacare a "train wreck" and clamoring for its repeal -- a move that would deprive more than 20 million people of health coverage and add to the federal deficit. On his campaign website, Rubio says the country "needs health care reform that will ... harness the forces of competition to keep health care prices low and spur innovation."

In fact, Rubio has played a role in ensuring there's less competition and, therefore, less innovation in the private insurance market created by Obamacare. And to the extent Obamacare is a train wreck not fully allowed to succeed because of stubborn opposition, it's a train wreck of Rubio and other Republicans' making.

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