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The Obamacare Death Spiral

When it comes to the messy business of repealing Obamacare, Republicans have usually been the Gang That Couldn't Shoot Straight, but every once in awhile reality comes along and makes the case for them.

Health insurance giant Humana is only the latest company to size up Obamacare's terrible enrollment environment and toxic risk pools, and choose to withdraw entirely from its participation in the law.

Other major insurers are doing the same — pulling out of one marketplace after another as they teeter on the edge of collapse.

Conservatives who say "the law is failing," aren't just blowing smoke. They're speaking the plain truth. And nobody is speaking more plainly than the CEO of Aetna:

Aetna Inc. Chief Executive Officer Mark Bertolini says that Obamacare’s markets are nearing failure as premiums climb and healthier individuals drop out.

Rising [Obamacare] rates push healthy people away, leaving insurers with sicker customers, thereby forcing premiums ever higher.

“It is in a death spiral,” Bertolini said in a video interview with the Wall Street Journal. He thinks more insurers will be dropping out of the market in 2018, following Humana’s decision to quit Obamacare entirely starting next year.

Aetna, too, is deciding whether to further cut its losses in the markets set up by the ACA. They cut back their offerings to four states for 2017, down from 15 after losing roughly $450 million on sales of ACA plans last year.

Bertolini has been saying for months that ACA markets are falling apart. In October, he was only stating the obvious when he said that rising rates would push healthy people away from Obamacare, leaving insurers with sicker customers, thereby forcing premiums ever higher. The ever greater burden of medical costs as ever fewer healthy customers enroll are among the necessary ingredients for producing an insurance death spiral.

Bertolini's October prediction has already come true, based on the Obama administration's own numbers. Health insurance executives understand that despite Obamacare's coercive mandates and huge subsidies, too many young and healthy people are staying away in droves from Obamacare's supposedly "affordable" coverage. It's a fiscal house of cards that cannot stand much longer, and the law's structural problems worsen each year as more people do the math and realize that it's not worth the expense.

Every day the current system continues its slow motion collapse is another day that real lives are damaged or lost.

Obamacare's faults cry out for radical "repeal and replace" action; the trend lines all point in that direction. Every day the current system continues its slow motion collapse is another day that real lives are damaged or lost.

Republicans must form a unified front in favor of a specific replacement package to roll out alongside repeal. We're still waiting for details and a timetable. Fortunately, the public strongly supports replacing Obamacare with something better, and they generally like what they've heard so far from House Speaker Paul Ryan.

Large and bipartisan majorities of voters are in favor of the biggest elements of a likely Republican plan. Most people want a total repeal, or major changes to the law — as opposed to a minority that wants only minor changes or none at all. When Ryan's repeal and replace plan is described in detail, support rises to 63 percent, while roughly six in ten voters give a thumbs-down to Democrats' stupid meme that Obamacare repeal would "make America sick again." Huge majorities also say that the new system must protect people with pre-existing conditions (92 percent) and keep the "26 year old" provision (79 percent).

The path forward may be rocky, but it's clear for all to see.