Sen. Rubio recently testified before Issa’s Oversight Committee to highlight Section 1342 of Obamacare, which deals with risk corridors. According to Kaiser Health a risk corridor is
“part of this three-pronged approach to help insurers manage the financial risk of taking all comers, taking everyone who applies for insurance no matter what their health status, while at the same time keeping premiums affordable. The corridors allow insurance companies and the government to share higher than expected costs or profits. Actual claims are compared to the claims that insurers anticipated when they set up their premiums.”
Rubio states in his testimony that the problem with Obamacare’s risk corridors is they are “not a normal circumstance.” He goes onto state “first of all its failures are not anomolies they are across the board. It’s not one or two companies that are miscalculating on Obamacare’s long term prospects it’s the entire industry that’s being effected by its failures.” Which Rubio ends by suggesting an eventual taxpayer bailout.
Note, however, Kaiser Health pointed to a recent Congressional Budget Office (CBO) report that projects “the risk corridor program would actually produce $8 billion in revenue for the government, rather than cost taxpayers money. And previously, the CBO had said that the program was budget neutral.”
I guess it’s time to start learning more about ‘risk corridors’ because in the end you just know any shortfall in projected revenue by the health insurance behemoths will fall on the taxpayers to bail them out.