The first U.S. city likely to experience the complete collapse of Obamacare has been identified.
Knoxville, Tennessee, has only one remaining insurance provider on its Obamacare exchange. But Humana, which provides the only subsidized insurance option for tens of thousands of people, has announced that it will be withdrawing from the market in 2018.
Approximately 40,000 people in the Knoxville area will be left without a subsidized insurance policy option unless another healthcare insurer replaces Humana in the exchange.
Obamacare does not promote market-based competition, leading to situations such as the one in Knoxville. Insurers have found that providing services via the exchange is not cost-efficient for their businesses, leading them to withdraw from the marketplace. Consumers suffer from fewer, if any, options offered at higher prices.
Tennessee has seen the departure of three insurers that have pulled out of the state entirely. Their state co-op is defunct, and premiums have escalated annually by double-digits.
Julie Mix McPeak, commissioner of the Tennessee Department of Commerce and Insurance told The Tennessean on Tuesday:
“I would characterize the exchange market in Tennessee as very near collapse … and that all of our efforts are really focused on making sure we have as many writers in the areas as possible, knowing that might be one. I’m doing everything I can to prevent a situation where that turns to zero.”
Insurance providers must meet the July 1 deadline to announce what 2018 plans they will provide, if any. Providers are expected to alert state officials within two months.
Should Humana withdraw, plans on the private marketplace would still be available for purchase by Knoxville citizens, although it is unclear how many consumers would buy plans without an Obamacare subsidy.
Tennessee Sens. Lamar Alexander (R) and Bob Corker (R) have proposed legislation that would allow consumers to apply Obamacare subsidies to the purchase of any state-approved insurance plan on the private marketplace. Should the bill pass, it would apply through 2019.
H/T: The Daily Caller
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