“Death Spiral”: Obamacare Premiums May Soar As Much As 91% Next Year

This report was originally published by Tyler Durden at Zero Hedge

Residents of Maryland and Virginia face double-digit percentage increases in premiums for individual Obamacare plans in 2019, according to rate requests made by insurers.

The largest hikes are being sought by CareFirst, which is seeking a 64% increase in Virginia, and a whopping 91% increase in Maryland for its PPO. Other insurers are following suit in the two states, with Kaiser requesting hikes of 32% and 37% respectively, followed by CareFirst’s HMO offering.

In Maryland, CareFirst wants to raise rates by 91 percent on a plan covering 15,000 people, Insurance Commissioner Al Redmer Jr. said. If approved, premiums for a 40-year-old could reach $1,334 a month. –Bloomberg

That’s over $16,000 per year for an individual plan in a state with an average personal income of $59,524.

“We have folks in Maryland that are struggling, that are trying to do the right thing, and they’re paying more for their health insurance than they are for their mortgage,” Redmer said on a call with reporters.

Maryland is seeking permission from the federal government to create a reinsurance program that would use $975 million in state and federal funds over five years to lower rates. That would help only temporarily, Redmer said. –Bloomberg

“I believe we’ve been in a death spiral for a year or two,” he said, adding that a permanent solution requires Congress to fix the Affordable Care Act.

Virginia and Maryland are the first two states in which 2019 rate requests – which are subject to regulatory approval and may change – have been made public, however increases are anticipated across the country as insurers adjust to the post-ACA battle. Final premium increases will need to be approved ahead of the November 1 open-enrollment period.

The hikes are being blamed in part by the expectation that the elimination of the Obamacare stipulation forcing all Americans to have health coverage would leave insurers with a smaller pool of sicker clients.

Many health plans have stopped selling health coverage through the exchanges created four years ago under Obamacare. The Republican-led attempt to overturn the health law last year caused premiums to surge, as insurers expected that undoing the law’s requirement that all Americans have health insurance would leave them with a smaller and sicker pool of clients. –Bloomberg

While the repeal of ACA ultimately failed, the Trump administration overturned the provision penalizing uninsured Americans – something last week Trump’s former top health official, Tom Price, warned would raise the cost of health insurance for some Americans.

“There are many, and I’m one of them, who believes that that actually will harm the pool in the exchange market, because you’ll likely have individuals who are younger and healthier not participating in that market, and consequently that drives up the cost for other folks within that market,” Price said at the World Health Care Conference in Washington.

Price’s comments are in line with predictions from the nonpartisan Congressional Budget Office, which in November projected 13 million fewer Americans would have health insurance by 2027 as a result of the elimination of the individual mandate. The CBO also said average premiums in the exchanges would increase by about 10 percent in most years over the next decade, compared with a scenario in which the mandate had been left in place. –Washington Post

“Those effects would occur mainly because healthier people would be less likely to obtain insurance and because, especially in the nongroup market, the resulting increases in premiums would cause more people to not purchase insurance,” the CBO said at the time.

“The individual mandate is one of those things that is actually driving up the cost for the American people in terms of coverage,” said Price on last summer on ABC’s This Week. “So what we’re trying to do is make it so that Obamacare is no longer harming the patients of this land — no longer driving up costs, no longer making it so that they’ve got coverage but no care.”

In Virginia, the health insurance market is quite sick – with Charlottesville and neighboring counties suffering under some of the most expensive healthcare costs in the nation for people who don’t receive government subsidies.

A 40-year-old trying to afford a mid-level plan will pay around $1,048 a month.

“Carol Wise, a former nurse and social worker in Charlottesville who consults for nonprofits, paid about $640 a month last year for an individual plan from Anthem,” repoorts Bloomberg. “When Anthem pulled out of her area, the only plan available, insurer Optima Health Plan, had a premium of $1,800 a month.”

“I was blown away,” said Wise, 62.

Wise instead joined a health-care sharing ministry for $280 a month, which offers far fewer protections than traditional coverage.

Breakdown of each insurer’s proposed changes via Bloomberg: 

• Group Hospitalization and Medical Services Inc., which operates a CareFirst BlueCross BlueShield, wants to raise premiums by 64 percent, on average, compared with 2018 premium levels, according to documents filed with Virginia regulators on May 4. The change would affect more than 4,000 customers.


• The Kaiser Foundation Health Plan is seeking an average rate increase of 32 percent on about 79,000 members in Virginia, while Cigna asked regulators to approve a 15 percent increase, projected to affect 103,000 members.


• Optima, which some Virginians have criticized for highest-in-the-nation premiums in some areas, said that on average its rates would decrease by 2 percent, and they would decline as much as 27 percent for some customers.


• In Maryland, CareFirst’s larger HMO plan covering 123,000 people requested a 19 percent increase. Kaiser is seeking a 37 percent hike. Both would put the new rates for a 45-year-old above $500 a month, Maryland officials said.


• Anthem Inc., which pulled out of many markets this year, is requesting a 6 percent increase for its HealthKeepers-branded plans in areas of Virginia where it remains.

“We’re still sky-high, and we still have a lot of concerns about the rates,” said Charlottesville resident Ian Dixon, who has helped organize Virginians to apply pressure on legislators and Optima for lower premiums. Even with a drop around 30%, he said, Optima’s 2019 rates come in at around double what residents were paying in 2017, when Anthem and other insurers were still offering plans.

The Scandalous Truth About Obamacare Is Laid Bare

Authored by Jeffrey Tucker via The Foundation for Economuc Education,

A government program that is ruined by permitting more choice is not sustainable.

It’s not just that Obamacare is financially unsustainable. More seriously, it is intellectually unsustainable, even though this truth has been slow to emerge. This has come to an end with President Trump’s executive order last week.

What does it do? It cuts subsidies to failing providers, yes. It also redefines the meaning of “short term” policies from one year to 90 days. But more importantly–and this is what has the pundit class in total meltdown–it liberalizes the rules for providers to serve health-coverage consumers.

In the words of USA Today: the executive order permits a greater range of choice “by allowing more consumers to buy health insurance through association health plans across state lines.”

The key word here is “allowing” – not forcing, not compelling, not coercing. Allowing.

Why would this be a problem?

Because allowing choice defeats the core feature of Obamacare, which is about forcing risk pools to exist that the market would otherwise never have chosen. If you were to summarize the change in a phrase it is this: it allows more freedom.

The tenor of the critics’ comments on this move is that it is some sort of despotic act.

But let’s be clear: no one is coerced by this executive order. It is exactly the reverse: it removes one source of coercion. It liberalizes, just slightly, the market for insurance carriers.

Here’s a good principle: a government program that is ruined by permitting more choice is not sustainable.

The New York Times predicts:

Employers that remain in the A.C.A. small-group market will offer plans that are more expensive than average, and they will see premiums increase. Only the sickest groups would remain in the A.C.A. regulated risk pool after several enrollment cycles.

Vox puts it this way:

The individuals likely to flee the Obamacare markets for association plans would probably be younger and healthier, leaving behind an older, sicker pool for the remaining ACA market. That has the makings of a death spiral, with ever-increasing premiums and insurers deciding to leave the market altogether.

The Atlantic makes the same point:

Both short-term and associated plans would likely be less costly than the more robust plans sold on Obamacare’s state-based insurance exchanges. But the concern, among critics, is that the plans would cherry-pick the healthiest customers out of the individual market, leaving those with serious health conditions stuck on the Obamacare exchanges. There, prices would rise, because the pool of people on the exchanges would be sicker. Small businesses who keep the more robust plans—perhaps because they have employees with serious health conditions—would also likely face higher costs.

CNBC puts the point about plan duration in the starkest and most ironic terms.

If the administration liberalizes rules about the duration of short-term health plans, and then also makes it easier for people to get hardship exemptions from Obamacare"s mandate, it could lead healthy people who don"t need comprehensive benefits to sign up in large numbers for short-term coverage.

Can you imagine? Letting people do things that are personally beneficial? Horror!

Once you break all this down, the ugly truth about Obamacare is laid bare. Obamacare didn’t create a market. It destroyed the market. Even the slightest bit of freedom wrecks the whole point.

Under the existing rules, healthy people were being forced (effectively taxed) to pay the premiums for unhealthy people, young people forced to pay for old people, anyone trying to live a healthy lifestyle required to cough up for those who do not.

This is the great hidden truth about Obamacare. It was never a program for improved medical coverage. It was a program for redistributing wealth by force from the healthy to the sick. It did this by forcing nonmarket risk pools, countering the whole logic of insurance in the first place, which is supposed to calibrate premiums, risks, and payouts toward mutual profitability. Obamacare imagined that it would be easy to use coercion to undermine the whole point of insurance. It didn’t work.

And so the Trump executive order introduces a slight bit of liberality and choice. And the critics are screaming that this is a disaster in the making. You can’t allow choice! You can’t allow more freedom! You can’t allow producers and consumers to cobble together their own plans! After all, this defeats the point of Obamacare, which is all about forcing people to do things they otherwise would not do!

This revelation is, as they say, somewhat awkward.

What we should have learned from the failure of Obamacare is that no amount of coercion can substitute for the rationality and productivity of the competitive marketplace.

Even if the executive order successfully liberalizes the sector just a bit, we have a very long way to go. The entire medical marketplace needs massive liberalization. It needs government to play even less of a role, from insurance to prescriptions to all choice, over what is permitted to be called health care and who administers it.

Freedom or coercion: these are the two paths. The first works; the second doesn’t.

Two Charts Prove Obamacare Is Not "Stabilizing" In 2018

As the Obamacare repeal and replace effort raged on in Congress over the past six months, several Democrats and even some of the original Obamacare architects stepped forward to argue that the crippling premium increases from 2014 through 2017 were just a 1x market adjustment and that everything would miraculously "stabilize" in 2018.

Well, according to data from the Kaiser Family Foundation, that prediction isn"t playing out exactly as expected.  Taking a look at 21 of the bigger healthcare markets in the United States, Kaiser found that premiums submitted so far for 2018 are increasing at an average rate of 17% YoY and ranging up to 49% in Wilmington. 

Now, we understand that the term "stabilizing" is somewhat subjective but we"re not sure that rates spiking at 10.5x prevailing inflation rates, on average, would reasonably fit anyone"s definition.

 

Meanwhile the 4-year rate increases from 2014 to 2018 are even more staggering...

 

And while Democrats continue to boast about overall Obamacare enrollments, the "off-exchange market" (i.e. people who make too much money to quality for subsidies and whose premiums are required to subsidize everyone else who does qualify) contracted by 2.1mm in 2016, or a 29% drop.  With those kind of declines, it"s only a matter of time until there are no more "rich" fools in the pool willing to continue subsidizing a broken system. More from the National Review:

Also, MFA published the same report in 2016, facilitating a year-over-year comparison. The on-exchange market fell from 12,681,874 to 12,216,003 individuals, a reduction of 465,871 or 4 percent. However, the off-exchange market fell from 7,520,939 to 5,361,451, a reduction of 2,159,488 or 29 percent. In other words, enrollment is steady among those who receive subsidies but declining dramatically among those who do not.

 

Much has been made of the question of whether the individual markets are in a “death spiral.” Given that the on-exchange market enrollment is relatively stable, there is clearly not a death spiral in the subsidized market. However, with a reduction in the unsubsidized market of 29 percent in just one year, that pattern certainly looks like one we would expect in a market spiraling down.

Of course, it"s all Trump"s fault now...

CNN Lies Send Ratings to Record Lows, Yogi Bear, Olsen Twin Reruns Now Have More Viewer

There’s a reason why TFTP does not cite CNN in most of our articles. Plainly stated, the Cable News Network is unreliable. And while the free-thinking great awakening continues to take place, Americans and many around the world have also taken notice. As a result, CNN’s ratings are tanking.

Hey @CNN, how are those ratings doing? And to think, this was measured before you blackmailed someone.
You"re fake, failing, fraud news. pic.twitter.com/uVXzWnyY4C

— /pol/ News Forever (@polNewsForever) July 7, 2017

Some of us are old enough to remember when “cable” became a household word and was sought after above the often unreliable over-the-air broadcasts of the usual big three networks and local channels. In the 1980’s, Ted Turner’s Cable News Network (CNN) was revolutionary. Prior to its inception, the only day-long news broadcasts available were on AM/FM radios, followed by one hour of broadcast news starting at 6 pm on television.

There’s no question CNN pioneered 24-hour cable news, but somewhere along the way, the company not only lost its objectivity but became a shill for the establishment and a tool for divisive distraction.

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Often criticized for being leftist leaning, in recent years, CNN has become known as the Clinton News Network by its critics. It was also one of the only networks with whom the Obama administration (including the president) would consult.

Obama once treated FoxNews as an unreliable fake news network, and refused to be interviewed by the network, along with many members of his administration. And, as TFTP has pointed out numerous times, FOX News has been busted multiple times pushing fake news. But let’s get back to CNN’s death spiral.

READ MORE:  WATCH: CNN Clearly Exposed Staging a Fake Scene to Propagandize Viewers

Take for instance Chris Cuomo’s warning in October to all Americans they would be committing a crime if they read Wikileaks’ publication of Democrat National Committee emails. He told viewers, “Remember, it’s illegal to possess these stolen documents.” Cuomo even attempted to steer viewers into only listening to CNN’s narrative on Wikileaks. He said, “It’s different for the media, so everything you learn about this (latest Wikileaks’ revelations) you’re learning from us.”

One thing’s for sure, Americans hate being told what to think, and they don’t take kindly to threats. Cuomo’s threat wasn’t received well by freethinkers, many of whom went straight to Wikileaks to see for themselves what CNN might have been hiding.

Apparently, CNN knew they had every reason to fear Wikileaks’ DNC database publication. After all, the DNC email data dump revealed CNN’s troubling collusion with the DNC against not only Democrat Bernie Sanders, but favored Hillary Rodham Clinton as well during a presidential election.

CNN has come under fire recently, not only for their negligence in reporting facts, but also for the focus of their news reporting. As The Federalist recently reported, CNN takes poetic license, apparently, with their quotations.

Not only did CNN misquote Abraham Lincoln and Benjamin Franklin, but they were the target of an investigative journalism sting operation led by the Veritas Project. Undercover VP reporters caught CNN producers claiming their news coverage of Russian meddling in the presidential election as “mostly bullshit“, driven by CNN executives who wanted to make a mountain out of a molehill so to speak.

READ MORE:  CNN Actually Admits They Published Fake News, Forced to Issue Retraction

More recently, the sitting president of the U.S., Donald Trump, has made it his mission to add fuel to the fire of CNN’s demise, openly calling their network “Fake News.”

Whether genuine or not, the Trump CNN battle has served as a highly effective distraction from US starting war in Syria, sponsoring terrorism, killing hundreds of civilians, and the military-industrial complex in general. While Trump claims they are his enemy, they’ve done nothing but help to cover up his war crimes in Syria and the fact that he is aiding the Saudis in murdering civilians in Yemen.

Just this week, at the G20 Summit, he again called them out for their shenanigans, not the least of which was the recent threatening of a GIF creator who depicted CNN getting body slammed by a professional wrestler with Trump’s visage.

It now appears that all of the lies and propaganda spewed out by the network have taken a toll on CNN’s ratings which is apparently now at an all time low. According to Zero Hedge, “CNN’s primetime shows (Anderson Cooper and Don Lemon) managed to draw about 6% fewer viewers than multi-decade old re-runs of “Yogi Bear,” “Full House,” and “Friends” which air in the same time slots on Nick-At-Nite.” One would be hard-pressed to find anyone born after 1980 who has ever heard of Yogi Bear! How CNN is hanging on is anyone’s guess at this point.

The Federalist describes how bad it has gotten for the once reliable CNN;

According to cable ratings from the week of June 26-July 2, CNN’s viewership of its primetime shows was ranked significantly lower than its competitors like Fox News and MSNBC, which place first and second respectively. Clocking in at No. 10 on the list, CNN fell behind HGTV, Nick At Nite, History Channel, and ESPN …

Nick at Nite! More Millennials are getting their programming from YouTube than Nick at Nite. In a time where scandals at FoxNews have seen the departure of its top performer (Bill O’Reilly), and the resignation of the third highest rated anchor (Megan Kelly), CNN could have capitalized, but instead it looks like CNN is capitulating; a victim of its own fake news stories, biased reporting, favoritism, and corruption.

READ MORE:  10 Massive Fake News Stories Western Media Has Been Feeding You On Aleppo

Pensions Will Be Wiped Out In America: “Perfectly Primed For the Greatest Financial Disaster”

This article was written by Michael Snyder and originally published at the Economic Crisis blog.

Editor’s Comment: The problem with waiting for a gigantic disaster to unfold is witnessing how thoroughly wired for demolition the whole thing is. The set up has been precise, even if ugly and basal in its fall. The Federal Reserve has long fed or starved panic and disaster with its creation of money, with the pumping of the prime, or the contraction of money supply. Now, after 8 years of Obama and a “recovery” from the 2008 economic crisis that has been based around unlimited liquidity, a major hot potato has been passed around for all those drenched in debt, and dependent upon a system that works.

Public pensions systems are the god-awful nightmare in the basement that threatens to make any such crisis – perhaps initially centered only around Wall Street behaviors – much, much worse by scale. Rather than lock boxes, they have become heavy-abused IOUs cash stashes, and in the most recent decades, these ‘vehicles’ for pay-it-later investing have been tossed around by private equity firms. They are agents for attempting to grow pension values on the open market, but they are also vulnerable as a carcass of ill-guarded funds that are easily spent on risky investments, and there to take the loss, while those who’ve done the betting once again go on the run.

The Ticking Time Bomb That Will Wipe Out Virtually Every Pension Fund In America

by Michael Snyder

Are millions of Americans about to see the big, juicy pensions that they were counting on to fund their golden years go up in flames in the biggest financial disaster in U.S. history? When Bloomberg published an editorial entitled “Pension Crisis Too Big for Markets to Ignore“, it simply confirmed what a lot of people already knew to be true.  Pension funds all over America are woefully underfunded, and they have been pouring mind boggling amounts of money into very risky investments such as Internet stocks and commercial mortgages.  Just like with subprime mortgages in 2008, this is a crisis that everyone can see coming well in advance, and yet nothing is being done about it.

On a day to day basis, Americans generally don’t think very much about pensions.  Most of those that have been promised pensions simply have faith that they will be there when they need them.

Unfortunately, the truth is that pension plans all over the country are severely underfunded, and this has already resulted in local fiascos such as the one that we just witnessed in Dallas.

But what happened in Dallas is just the very small tip of a very large iceberg.  According to Bloomberg, unfunded pension obligations on a national basis “have risen to $1.9 trillion from $292 billion since 2007″…

As was the case with the subprime crisis, the writing appears to be on the wall. And yet calamity has yet to strike. How so? Call it the triumvirate of conspirators – the actuaries, accountants and their accomplices in office. Throw in the law of big numbers, very big numbers, and you get to a disaster in a seemingly permanent state of making. Unfunded pension obligations have risen to $1.9 trillion from $292 billion since 2007.

And of course that $1.9 trillion number is not actually the real number.

That same Bloomberg article goes on to admit that if honest math was being used that the real number would actually be closer to 6 trillion dollars…

So why not just flip the switch and require truth and honesty in public pension math? Too many cities and potentially states would buckle under the weight of more realistic assumed rates of return. By some estimates, unfunded liabilities would triple to upwards of $6 trillion if the prevailing yields on Treasuries were used. That would translate into much steeper funding requirements at a time when budgets are already severely constrained. Pockets of the country would face essential public service budgets being slashed to dangerous levels.

So where are all of these pensions eventually going to come up with 6 trillion dollars?

That is a very good question.

Ultimately, even if financial conditions stay as stable as they are right now, a whole lot of people are not going to get the money that they were promised.

But things will get really “interesting” if we see a major downturn in the financial markets.  According to Dave Kranzler, if the stock market were to fall by 10 percent or more and stay there for a number of months, that “would cause every single public pension fund to blow up”.  And Kranzler is also deeply concerned about the tremendous amount of exposure that these pension funds have to commercial mortgages…

Circling back to the mall/REIT ticking time-bomb, while the Fed can keep the stock market propped up as means of preventing an immediate nuclear melt-down in U.S. pensions (all of which are substantially “maxed-out” in their mandated equities allocation), the collapse of commercial mortgage-back securities (CMBS) will have the affect of launching a nuclear sub-missile directly into the side of the U.S. financial system.

The commercial mortgage market is about $3 trillion, of which about $1 trillion has been packaged into asset-backed securities and stuffed into yield-starved pension funds. Without a doubt, the same degree of fraud of has been used to concoct the various tranches in these CMBS trusts that was employed during the mid-2000’s mortgage/housing bubble, with full cooperation of the ratings agencies then and now. Just like in 2008, with the derivatives that have been layered into the mix, the embedded leverage in the commercial mortgage/CMBS/REIT model is the financial equivalent of the Fukushima nuclear power plant collapse.

I have previously talked about the ongoing retail apocalypse in the United States which threatens to make so many of these commercial mortgage securities go bad.  It is being projected that somewhere around 3,500 stores will close in the months ahead, and this is going to absolutely devastate mall owners.  In turn, it is inevitable that a lot of their debts will start to go bad, and pension funds will be hit extremely hard by this.

But the coming stock market crash is going to hit pension funds even harder.  Stocks are ridiculously overvalued right now, and if they simply return to “normal valuations”, pension funds are going to lose trillions of dollars.

We are talking about a financial tsunami that will be absolutely unprecedented in our history, and yet investors continue to act like the party can last forever.  In fact, we just learned that margin debt on Wall Street has just hit another brand new record high…

The latest data from the New York Stock Exchange show margin debt, or cash borrowed to buy shares, hit a record $528.2 billion in February, up from its prior high of $513.3 billion in January.

Of course my regular readers already know that margin debt also shot up to dramatic peaks just before the last two stock market crashes as well…

Prior periods when margin debt hit records occurred around stock market peaks, including 2000 when the dot-com stock boom went bust, and 2007 when stocks began to crater amid early signs of trouble in the housing market ahead of the 2008 financial crisis.

Margin debt jumped 22% from the end of 1999 before peaking in March 2000 at $278.5 billion, the same month stocks peaked. In 2007, margin debt shot up to $381.4 billion in July, three months before stocks topped.

We are perfectly primed for the greatest financial disaster in American history, and yet very few people are sounding the alarm.

This massive financial bubble is a ticking time bomb, and when it finally goes off it is going to wipe out virtually every pension fund in the United States.

This article was written by Michael Snyder and originally published at the Economic Crisis blog.

Aetna CEO Says Obamacare In "Death Spiral" And "It's Getting Worse"

Back in the summer of 2016, as Obamacare rates were being set for the 2017 plan year, we repeatedly argued that the entire system was on the "verge of collapse" as premiums were soaring, risk pools were deteriorating and insurers were pulling out of exchanges all around the country leaving many Americans with just a single "option" for health insurance (see "Obamacare On "Verge Of Collapse" As Premiums Set To Soar Again In 2017").

And while Democrats may be all too willing to quickly dismiss our analysis, they may want to listen to the warnings of the CEO of one of the country"s largest health insurers who says that Obamacare is in a "death spiral."  In speaking with the Wall Street Journal, Aetna CEO Mark Bertolini said, among other things, that the "risk pools are deteriorating in the ACA" to a point that it would inevitably result in more withdrawals this year.   Per The Hill:

"It"s not going to get any better; it"s getting worse."

"That logic shows just how much the risk pools are deteriorating in the ACA," Bertolini said.

He added: "I think you will see a lot more withdrawals this year. ... There isn"t enough money in the ACA as structured, even with the fees and taxes, to support the population that needs to be served."

"It is in a death spiral," he said, but did not say whether Aetna would participate in the exchanges in 2018.

And, while his commentary was mostly doom and gloom, if there was one silver lining from Bertolini"s interview, it was his acknowledgement that at least "mathematics education in the United States is working" since consumers seem to be able to run the simple math required to figure out that paying ~$12,000 per year in premiums for a family of 4, plus $6,000 in deductibles, all for a service they never use, is a bad deal.

"You know that mathematics education in the United States is working when someone says, let me see, i"m going to pay this much premium, i"ve got a $6,000 deductible, and when I go to the doctor i"m going to pay cash...so premium, plus deductible, plus paying cash...why do I do this?  I"ll just pay the penalty and move on."

"And so that risk keeps leaving and risk inside the pool keeps getting worse...the rates continue to chase it...and the participants start to leave, either at the bottom of the risk pool or the plans themselves."

Of course, Bertolini"s comments today followed yesterday"s announcement from Humana that, due to an "unbalanced risk pool" (i.e. not enough healthy, young people paying massive premiums to balance out the risk of older, sicker customers), they would be pulling out of all Obamacare exchanges nationwide in 2018.  Per Humana"s press release:

Regarding the company’s individual commercial medical coverage (Individual Commercial), substantially all of which is offered on-exchange through the federal Marketplaces, Humana has worked over the past several years to address market and programmatic challenges in order to keep coverage options available wherever it could offer a viable product. This has included pursuing business changes, such as modifying networks, restructuring product offerings, reducing the company’s geographic footprint and increasing premiums.

All of these actions were taken with the expectation that the company’s Individual Commercial business would stabilize to the point where the company could continue to participate in the program. However, based on its initial analysis of data associated with the company’s healthcare exchange membership following the 2017 open enrollment period, Humana is seeing further signs of an unbalanced risk pool. Therefore, the company has decided that it cannot continue to offer this coverage for 2018. Through the remainder of 2017, Humana remains committed to serving its current members across 11 states where it offers Individual Commercial products. And, as it has done in the past, Humana will work closely with its state partners as it navigates this process.

Meanwhile, Trump seized on the announcement saying that as "Obamacare continues to fail" his administration would "repeal, replace & save healthcare for ALL Americans."

Obamacare continues to fail. Humana to pull out in 2018. Will repeal, replace & save healthcare for ALL Americans. https://t.co/glWEQ0lNR4

— Donald J. Trump (@realDonaldTrump) February 14, 2017

Frankly, we"re shocked at all of this!  Turns out that whole "adverse selection bias" was a real thing...who could have known? 

Are You “Living In a Death Spiral”? These 6 States Will Collapse During the Next Recession

Being on the hook is not going to be pretty when interest rates are raised back up, and debts come due. At a personal level, it will mean more stress and juggling to make ends meet. For the larger economy, it will mean cities and states unable to meet obligations or balance their budgets – ending in bankruptcy, and bailouts. Meanwhile, millions of people are relying on that money to keep coming in order to survive. Something is going to go very wrong.

Relying upon government to function and send you money is not a secure plan.

The mathematics are terrifying and dismal, and so is being caught up in these collapsing states.

In the next phase of the financial crisis, the debt supercycle will become the most defining feature of the big hurt that will fall on nearly everyone.

That’s the dire warning that Goldman Sachs issued about what they termed the Third Wave of the global collapse. But it hasn’t come, at least not yet:

This wave is characterised by rock-bottom commodities prices, stalling growth in China and other emerging-markets economies, and low global inflation, Goldman Sachs analysts led by Peter Oppenheimer said in a big-picture note.

This triple whammy has its roots in the response to the first two waves of crisis — the banking collapse and European sovereign-debt crisis — and it is all part of the so-called debt supercycle of the past few decades.

Unfunded liabilities for pensions and other state benefits are threatening the security and future of an entire generation of retiring, hardworking Americans.

The debt will be shifted for as long as possible… but eventually, someone will have to come to terms with it. The black hole totals up to huge sums of money; no one can pay; and the system is bankrupted, or services rendered become inadequate and farcical.

Forbes contributor William Baldwin describes the acute problem of “death spiral states,” which could actually be as bad as it sounds. It affects dozens of cities and municipalities as well.

Does your state have more takers than makers? Check it out.

California has a powerful economy, with 14 million private-sector jobs. It also has burdens: welfare recipients (12.6 million), generously paid government employees (2.1 million) and people collecting government pensions (1.3 million).

Add up the numbers. There are 114 clients drawing from the government for every 100 people chipping in by working outside the government and paying taxes. We’re calling this the Feedme Ratio. Six states have a number over 100.

These states are at risk of going into a downward spiral in the next recession. The burdens will remain but too many of the providers—employers in the private sector—might shrink or decamp.

Right now, the biggest risks for a bankruptcy or collapse is in the these states, based upon the ratio between what Baldwin terms “makers” and “takers.” Basically, the socialist state is enveloping all prosperity:

• New Mexico – 148 dependents per private sector worker

• West Virginia – 116 dependents per private sector worker

• California – 114 dependents per private sector worker

• Mississippi – 111 dependents per private sector worker

• New York – 108 dependents per private sector worker

• Arkansas – 103 dependents per private sector worker

Detroit and Chicago top the lists of cities who wouldn’t be healthy in the ratio of makers/takers either, and would crumble in a debt crunch.

You can check on your state via this interactive map, though it is dated slightly to 2015.

A score under 100 means that the state has a net number of providers, and is theoretically on more solid ground. However, the pressures are endemic n the system, and no state is immune. For instance, Texas has a healthy score of 66.7; yet, the city of Dallas just announced that it is suspending pensions payments to city rescue workers and employees. There’s a serious disconnect.

Once things go downhill, violence, crime, looting, riots and the like become chronic problems. The police state presence is also an issue, and society goes on edge.

Everyone can feel the sinking depths, and order is about to implode. When things go primal, you do not want to be around to get caught up in it.

Being inside a major city on the day that the ATMs stop spitting out cash, or EBT cards don’t work will be an incredibly dangerous day. Relying upon government bureaucracy and functioning technology to meet your vital needs is a good position to be in during an emergency situation – be it economic crisis, hurricane, power grid failure or something else.

Joel Skousen described in great detail how to avoid the urban areas that will become completely dysfunctional nightmares at the first sign of a major emergency.

Your retreat should be strategically chosen to lay outside of certain regions, military targets and fragile climates. Knowledge of the back roads is essential to planning a route that won’t leave you stranded on the highway in endless gridlock.

Above all, it is advisable to avoid mass populated areas, especially big cities on the East and West Coast. People are prone to panic, and will be easily cut off from essential services become desperate. There are far too many bad apples in that ratio for any good to result.

Avoidance is key – and that is why living in a “death spiral” state like California or New York could be a major liability during a crisis, or alternately a prolonged collapse.

CalPers pension… a massive black hole that is merely carving a path for many failed states to come.

The future is austere if this equation isn’t balanced out:

Tom Chatham warns about the abrupt change that is coming home to roost in America. Things can get really bad, really quick.

But really, most of us don’t know how bad it will get:

Americans that have only known the post WWII prosperity are ill equipped and educated to deal with depression level living. Easy credit and instant gratification have created a nation of whining, self absorbed, entitlement minded people with no moral or mental toughness.

Doug Casey believes we are headed for what he calls a super depression created by the ending of a debt super cycle. The bigger the debt cycle the bigger the depression that follows. That’s how reality works and most people are not prepared for reality.

When this depression, which has already started, gets momentum, it will overwhelm the plans of a society that is expecting to get things like social security, pensions and payouts from retirement plans they have paid into for many years. All of those things will disappear almost overnight and leave society gasping and stupefied over what to do.

The big reveal is coming: inside that great big old lock box… is just another I.O.U.

Are you prepared for the future, and all the economic uncertainty it could bring?

Read more:

Screwed Over Retirees: Dallas Suspends Withdrawals From “Insolvent Pension System”

Goldman Sachs: The Third Wave of the Financial Crisis Is Upon Us

5 Urgent Warnings From Big Banks That the “Economy Has Gone Suicidal”

2008 Repeat Coming, Says George Soros, Harbinger of “Impending Financial Markets Crisis”

Debt Super Cycle Will Destroy U.S. Standard of Living Overnight “Leave Society Gasping and Stupefied”