Insurers Are Baffled About Low Number Of ObamaCare Enrollments; Mainstream Media Worries About Early Flu Season

Updates

January 12, 2014: the numbers are low, but what is worse is the fact that the demographics are wrong -- too many old, high risk folks signing up for ObamaCare; not enough young folks enrolling. Predictable. Reuters is reporting:

Now that more than 2 million people have signed up for private insurance plans created by President Barack Obama's healthcare law, a crucial next check-up for the new marketplace will be to see how old customers are.

Early data from a handful of state exchanges shows the administration needs more young adults to sign up in the next three months to help offset costs from older enrollees and prevent insurers from raising their rates.

Critics of Obama's Affordable Care Act say the market won't attract enough young people to keep it financially viable, putting more pressure on government funds to compensate for any insurer losses.

Data from seven states and the District of Columbia, which are running their own marketplaces, show that of more than 200,000 enrollees, nearly 22 percent are 18 to 34 years old, according to a Reuters analysis.

The administration had hoped that over 38 percent, or 2.7 million, of all enrollees in 2014 would be 18 to 35 years old, based on a Congressional Budget Office estimate that 7 million people would sign up by the end of March.

Again, this is not a problem. The insurers are protected by the law: a bailout is guaranteed. The insurers will simply become "pass-through" entities for ObamaCare. The folks who crafted this bill were no dummies, and with a president who was given a free pass on every executive decision modifying the law, things are working out just fine for ObamaCare.

 

Original Post

The Dickinson Press is reporting: yup, insurers are baffled about the low number of enrollees. Let's count the ways:

• the websites didn't work
• the federal website was taken off-line for the first three weeks
• the ObamaCare website has more security risks than the Target breach
• original website required private data submission before viewing plans
• majority of folks who thought they would qualify, do not qualify (income is required)
• the most affordable plans had a $12,000 annual deductible

But the big reason North Dakota folks did not enroll: with the Bakken boom, everyone in North Dakota is a millionaire (some billionaires) and do not qualify for subsidies, so why sign up?

Just joking. The big reason folks did not enroll: sticker shock.

The insurers are not concerned: the law provides for a bailout if the insurers lose money on this scheme.

In the end, the insurers will simply be "pass-through" entities for national health care.

In case the above link is broken:

The Sanford Health Plan enrolled 92 in North Dakota through the new marketplace exchange.

By the way, Sanford Health has the monopoly in North Dakota for Medicaid; Blue Cross Blue Shield pulled out of Medicaid coverage in North Dakota.

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Mainstream media seems to be reporting that the flu season might be earlier and worst than previous seasons. See for yourself at Google flu trends, probably a better source than the government's own statistics. Right now, the flu season this year is much, much less severe than what it was this time last year.

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One would think that with the highest corporate tax rate in the world, the US would have no trouble paying universal health care, or at least subsidizing it. 

The U.S. has the highest corporate tax rate in the developed world. After Japan lowered its tax rate last year, the combined federal and average state tax rate of 39.2% in the U.S. was the highest of any nation in the Organization for Economic Co-operation and Development.

Some mega-corporations pay billions of dollars every year in federal and state taxes. In its most recent fiscal year, Exxon Mobil reported $31 billion in corporate income tax expenses.

Some large corporations, on the other hand, paid no taxes at all and even received tax benefits.

General Motors, which had annual revenue of more than $150 billion, received a tax benefit of $28.6 billion. 24/7 Wall St. examined the 10 U.S.-based, publicly traded companies with tax expenses of more than $5 billion in their most recently reported fiscal year, and the 10 companies that received a benefit of at least $5 million.

The ten (10) companies paying the most income tax, from least to most: Microsoft, IBM, Berkshire Hathaway, JPMorgan, ConocoPhillips, Wal-Mart, Wells Fargo, Apple, Chevron, Exxon Mobil. I doubt we will ever see a wind energy or solar energy corporation make the top 10 list.

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Speaking of corporate taxes, these corporations are also well known for philanthropy. As just one minor example, The Bismarck Tribune is reporting:

State leaders recognized an energy company Wednesday for its $1 million contribution to the Housing Incentive Fund which fills out the portion of the fund to be capitalized through tax credits.

Members of the North Dakota Industrial Commission recognized Denver-based QEP Resources for its contribution.

Earlier this week it was announced that the $20 million in state tax credits authorized by the Legislature through taxpayer contributions had been reached. These HIF dollars are in addition to a $15.4 million direct appropriation made to the fund for this biennium.
Gov. Jack Dalrympe said the $1 million from QEP Resources put the fund over the threshold.

I've been remiss in not reporting corporate philanthropy since the boom began -- mostly because it was hardly news -- there were so many companies donating at so many levels. But a reader pointed out that we haven't seen any donations from renewable energy companies in North Dakota. I'll watch for them. North Dakota is one of the leading wind energy states in the US.
 

Just a Gentle Reminder: For Every Gallon of Gasoline, 50 Cents in Taxes; XOM Earns 2 Cents Per Gallon

Link here.

I knew it was lopsided, but I did not know it was this bad.

I continue to recommend Carpe Diem as perhaps the best other blog on the internet.

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Flashback

March 28, 2011: After posting the comment about GE not paying taxes this year (as reported by CNBC), someone wrote me saying that XOM had not paid US federal taxes in years. Of course, that was incorrect, and was discussed in the comment section below.  Interestingly enough, CNBC touched on this subject again today, and put up two slides. The first slide listed four Forturne 500 companies that paid less than the statutory corporate tax rate (35%). That slide did not include any oil companies. The second slide had three companies, and the top two were XOM and COP. XOM had an effective 42% US federal tax rate for 2010, and COP had an effective 41% US federal tax rate for 2010, double the average tax rate paid by Fortune 500 companies. The average effective tax rate paid by Fortune 500 companies is 20%.

Here are the notes from the comment section regarding XOM taxes:

That would not surprise me, except that the statement that XOM has not paid federal income tax in years is not accurate.

MotherJones.com confirms that XOM did pay federal taxes in 2009. MotherJones' assertion that XOM did not federal income tax was picked up by many; MotherJones ended up retracting that.

From SeekingAlpha.com:

"Exxon's tax payment in 2007 of $30 billion (that's $30,000,000,000) is a record, exceeding the $28 billion it paid last year. $5 billion of that was US Federal income tax.

By the way, Exxon pays taxes at a rate of 41% on its taxable income." -- Seeking Alpha.com

So that takes care of 2009, 2007, and 2006.

But here's the best source (http://www.stock-analysis-on.net/NYSE/Company/Exxon-Mobil-Corp/Analysis/Income-Taxes):

XOM paid the following taxes below:

US Federal income tax (numbers rounded):

2010: $1.2 billion
2009: ($0.84 billion)
2008: $3 billion
2007: $4.7 billion
2006: $2.9 billion

Total taxes paid by XOM (again, remember, GE paid no taxes in 2010):

2010: $21 billion
2009: $15 billion
2008: $27 billion
2007: $30 billion
2006: $28 billion

In the big scheme of things, XOM's US earnings are small compared to its worldwide activities.

From yet another source:

In 2010, Exxon's total taxes and duties to the U.S. government topped $9.8 billion, making the company one of the largest taxpayers in America, he writes. In the past 5 years, Exxon has paid nearly $59 billion in U.S. taxes.

"Critics often try to ignore these facts by saying the oil and gas industry receives 'subsidies'," Cohen writes. "But what they really mean is that they want to increase our taxes by taking away long-standing deductions for our industry while leaving these same deductions in place for other sectors of the economy."

From yet another source, Carpe Diem.

Also, from same link, speaking of windfall profits tax:

The 6.1% average profit margin for Exxon's industry "Major Integrated Oil and Gas" ranks #112 among all industries for the most recent quarter (data here), so if Obama wants to target "excessive" corporate profits, there are many other industries much more profitable than the oil and gas industry.  For example, the surge in commodity prices has resulted in "windfall profit" margins of 31% for the silver industry, 23% for the copper industry and 19.8% for the gold industry.  Internet providers are capturing 23% in profit margins, cigarette companies more than 21% and periodical publishers are earning a whopping 51.6% profit margin, so perhaps those would be ripe targets for Obama's new lust to confiscate "windfall profits."