State Obamacare Exchanges Under Water

The health insurance exchanges in 17 states were set up to correspond with the enactment of the Obamacare legislation. The exchanges were meant to both aid voters in gaining new insurance policies and comply with the trigger for individual subsidies.

Now, if the court challenges do not undo the law, the failure of the exchanges could the Washington Post reports. At least half of the 17 exchanges in president Obama’s legislative achievement are currently struggling financially.

The steep technology costs associated with both maintaining a website and running a call center for prospective policyholders fall to the states.

What’s more, the $5 billion in federal state funding ends this year. The funding is meant to defray operating costs which will now be another burden on state budgets. The lack of growth in new policyholders has also limited the states’ ability to allay costs.

The states anticipated operating costs to cover fees imposed on insurance providers, on a per transaction basis. As the number of new policies begins to plateau, as it necessarily must, states are finding it hard to break even. Regardless of the number of new policies, states must continue operating both their website and call center.

Some analysts speculate the exchanges may revert to federal control should the Supreme Court uphold federal subsidies to the states. This will further saddle American taxpayers with billions in additional costs.