Today Sarah Kliff at Politico reports that a small Virginia-based health insurer will be closing its doors, effective December 31. The reason nHealth is shutting down?
“The uncertainties in the regulatory climate coupled with new demands imposed by national health care reforms have made it challenging to sustain the level of sales required to remain viable over the long run,” according to a letter given to company employees.
Cynics and critics of Obamacare pointed out the regulations would indeed drive private insurance companies out of business and it appears that the Richmond-based company will be the first.
What’s most sad about this particular closing is that the company, “specializes in high-deductible insurance plans, meant to cover larger medical emergencies, that are paired with health savings accounts, the tax-deductible accounts used to pay for medical expenses” – exactly the sort of plan which would be most beneficial to the large percentage of the uninsured who are relatively young and healthy.
Part of the problem with the future outlook of companies which specialize in HSAs is that the regulations (which haven’t been written yet) may leave insurers in limbo.
According to Heritage Foundation blogger Kathryn Nix,
“the worst news for those using HSAs is the provision requiring all policies to cover at least 60 percent of the actuarial value of the benefits offered. What’s the actual value? No one really knows—not until the Health and Human Services Department issues regulations on how to calculate it.”
Obviously if the saved portion is counted toward the value those who are just starting out or have little in their HSA wouldn’t qualify. It will be up to career bureaucrats and lobbyists to make this decision and chances are good Fedzilla will want to exert maximum control over consumers.
It’s areas like this where defunding may not have the desired effect and all-out repeal of Obamacare is the only solution.