HealthSource and Defrauding of Taxpayers

justin-katz-avatar-smiling

Ted Nesi reports that HealthSource RI — the state’s ObamaCare health benefits exchange — wouldn’t accept two lower-cost plans from Neighborhood Health.  Even on its surface the decision is an outrageous scam:

A Kaiser Family Foundation analysis, which originally included the two Neighborhood plans rejected by HealthSource, suggested they would have lowered the average premium for HealthSource’s second-cheapest mid-tier plan by 14% in 2017. Instead that number will only decrease by 0.5%, according to HealthSource.

But HealthSource officials said their decision was driven by the federal formula for premium subsidies, which are provided to about 90% of the Rhode Islanders who buy insurance through the marketplace.

In other words, Rhode Island officials didn’t want prices to go down too much because they want to force federal taxpayers (ultimately through debt) to pay $17 million more for Rhode Islanders’ health care than they ought to.  The openness with which “HealthSource officials” admit this shows they believe Rhode Islanders are happy to have their government stealing on their behalf, but some of us aren’t so immoral.  As a side benefit to local government agents, the after-tax cost of the exchange’s average health plan would have gone up 42% if they didn’t rig the market, making the exchange look even worse in the public eye.

And that’s not all.  Earlier this month, we learned that Neighborhood initially set its prices too high because its inexperience in the market left the organization no good basis by which to set prices.  So, they ended up refunding $2 million to members, probably with much of it simply a transfer of money taken from taxpayers as subsidies.

In summary, Neighborhood Health, which was arguably more like a quasi-public welfare agency before ObamaCare, overcharged its customers from the start, which forced us all to pay more in subsidies in our capacity as United States citizens.  It then refunded a chunk of the excess to its members, none to taxpayers.

Now, state government officials have refused to allow Neighborhood to charge less for plans in order to steal more money from taxpayers.  This action may very well result in another big transfer of wealth to Neighborhood members through another refund next year.

And on it will go.  If a private organization behaved like this, politicians and pundits would be declaring it scandalous.



Quantcast