(Above: President Obama gives a pitch to Congress to pass ObamaCare in 2009, uses Alabama as an example)
Before a joint session of Congress back in September 2009, President Barack Obama made a final push for passage of his healthcare reform bill now commonly known as ObamaCare.
That speech is better remembered for South Carolina Republican Rep. Joe Wilson’s “you lie” outburst. But immediately after that incident, Obama said his law would bring competition into the health insurance marketplace in states where the market was controlled by only a few companies. The example he held up — Alabama.
“So let me set the record straight here,” Obama said. “My guiding principle is, and always has been, that consumers do better when there is choice and competition. That’s how the market works. Unfortunately, in 34 states, 75 percent of the insurance market is controlled by five or fewer companies. In Alabama, almost 90 percent is controlled by just one company. And without competition, the price of insurance goes up and quality goes down. And it makes it easier for insurance companies to treat their customers badly — by cherry-picking the healthiest individuals and trying to drop the sickest, by overcharging small businesses who have no leverage, and by jacking up rates. Insurance executives don’t do this because they’re bad people. They do it because it’s profitable. As one former insurance executive testified before Congress, insurance companies are not only encouraged to find reasons to drop the seriously ill, they are rewarded for it. All of this is in service of meeting what this former executive called ‘Wall Street’s relentless profit expectations.’”
But now that ObamaCare is the law of the land, the insurance market in Alabama has hardly become more competitive. In fact, it has become less competitive.
An analysis from the Heritage Foundation’s Alyene Senger finds that 96 percent of the state’s counties will have only one insurer offering coverage in the exchange. Only three counties according to Senger have more than one insurer on the ObamaCare exchange — Jefferson, Madison and Shelby.
“By the standards of the President’s own ‘guiding principle,’ his law largely fails,” Senger wrote. “Obamacare’s overregulation of insurance is to blame for the lack of competition in the exchanges. The flawed policies contained in Obamacare neither foster competition nor increase consumer choice, and they will continue to negatively impact American consumers and increase costs.”
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