ACA growing pains: Losses for Blue Cross Blue Shield of Texas are over twice the U.S. average

[TexasTowelie]

Even Obamacare losses are bigger in Texas. So who’s to blame — Washington or ourselves?

About 10 million Americans, including 1 million in Texas, get health insurance through the exchanges created by the Affordable Care Act. Those customers, along with the expansion of Medicaid in most states, added $86 billion in annual revenue for insurers nationwide.

Unfortunately for them, most of the business has been a money-loser. And Texas’ largest insurer, Blue Cross Blue Shield of Texas, has been hit hard — over twice as hard, in fact.

The Texas unit lost almost $400 million on exchange business in 2014, the ACA’s first full year. That comes to a loss of about $360 per member, based on rate filings with regulators. That compares with an average loss of $163 per member for insurers nationwide, according to an estimate by McKinsey & Co.

Read more: http://bizbeatblog.dallasnews.com/2015/12/aca-growing-pains-losses-for-blue-cross-blue-shield-of-texas-are-over-twice-the-u-s-average.html/

[ghostsinthemachine]

1. These are result of the built in triggers

in the ACA that mandates that the HMO's etc use 80% (Or something like that) of their revenue on patient care, not salaries etc. I would provide the link but it is long gone now. I've posted it many times though, let me see if I can find it.

BTW< the HMO's have never come close to that figure.

On edit: I cannot find the links. Perhaps someone can.

[DhhD]

4. I remember it quite well. Anything over 80% they had to pay back to their customers. Many

remember getting a check from the insurance company in 2012 and 2013.

[kacekwl]

2. Losses can measured many different ways.

Such as a giant mega profit to now only a mini mega profit is a loss.

[Ilsa]

3. Isn't BCBS being sued by CA for

what looks to me to be comparable to redlining?

Aren't they in trouble elsewhere for shifting costs or revenues or something between entities, affecting pricing?

I guess I'm having a hard time believing that they are in as much trouble as they say they are.

[TexasTowelie]

5. They might have to raise the rates on their ACA policies by about $30 a month.

What is missing from the story though is the amount of income generated through the non-ACA and platinum business policies.

There is also a provision in the ACA such that the federal government provides the equivalent of reinsurance so they aren't recording a $400 million loss on their books.

[Ilsa]

6. Thanks! nt

[Manifestor_of_Light]

7. That's all I could get.

Here in rural Texas, I could only get BC/BS.

They're probably whining because 80% of their money has to be spent on actually insuring patients and not on salaries and bonuses for the big cheeses.

First time in my life I have been able to get affordable health insurance on my own and not as a dependent.