And so it begins, big insurance flees big obamacare . . .

Big Insurer Flees Obamacare

. . . and if others follow, that could spell disaster. 

"As the FT notes, UnitedHealth’s decision does not come as a surprise (we wrote about the company’s ACA woes last year), and—unless other big insurers follow suit—it doesn’t herald the imminent collapse of the law. But the fact that even major insurers like UnitedHealth are hemorrhaging cash on the Obamacare exchanges highlights the fact that for all the ACA’s technocratic tinkering, it did not and will not fix the fundamental problem facing the U.S. healthcare system: That it’s too expensive, and that costs are growing too quickly.

The architects of the ACA took aim at access, rather than affordability, achieving a coverage expansion mostly by putting more Americans on the Medicaid rolls. They left the underlying issues plaguing the healthcare system in place (and in many cases exacerbated them), so middle class families are still seeing a growing share of their paychecks consumed by rising premiums and deductibles. And they failed to realize that in the long run, affordability is access, and that attacking the factors that inflate the cost of healthcare in the private market should be a higher priority than expanding subsidies. The departure of UnitedHealth from the exchanges is a devastating illustration of Obamacare’s failure to bring down costs, and clear evidence that, no matter what the White House says, the debate over health reform isn’t going away."

Perhaps this is nothing, and all the other insurers are doing fine. Then again that seems unlikely. The ACA is faring poorly in its goals, and it seems to be consuming both insurers, and insureds at a disturbingly high rate. If it is to survive it will need to do more to lower insurance premium costs, while at the same time it increases coverage. This is likely an impossible goal for a program run by government, but the likely outcome of a free market program. 

Perhaps it is time to introduce the ACA to the free market.