Tags: Obamacare | Rules | Healthcare | Affordable Care Act

Riverside's Hendrickson to Moneynews: Obamacare Transition Rules Are Ailing

By    |   Friday, 28 June 2013 07:09 AM

Pam Hendrickson, the chief operating officer of the Riverside Company, said three years from now maybe we'll all say Obamacare was the greatest thing that ever happened, but the transition rules have not been well thought out.

"The exchanges, which are supposed to be up and running in October, are not," Hendrickson told Newsmax TV in an exclusive interview.

She added that a third of the states are not going to do them at all, a third haven't decided, and a third are "sort of rapidly" trying to put exchanges in place.

Watch our exclusive video. Story continues below.




"You're sort of confronted with this situation where you have absolutely no idea what to do as a little company in America," she said.

Editor's Note: ObamaCare Secrets Revealed

"Then, on top of that, you're looking at massive increases in fees as a consequence of the fees and taxes that are associated with the Affordable Care Act," she said.

"The ranges I'm starting to hear as the underwriters are coming out with their new rates for 2013, there's 16 percent at the low end … and 48 percent at the high end."

She mentioned "a fair amount of publicity" about McDonald's and Burger King talking about sharing workers "so that they could each work 20 hours for each company and then nobody would have to provide benefits because if you're less than 30 hours, you don’t have to provide benefits."

Hendrickson outlined a scenario in which "a little company in America" is looking at a worst-case scenario, a 48 percent increase in costs in a state where there's no exchange.

"You're concerned about throwing your employees to something that you don't even know what it is because you want to retain your talent, and so now you've got to figure out how are you going to pay this 48 percent increase," she said.

"I'm surely not hiring any more people because I can't afford to and … I might have to fire some people to be able to provide health care to the ones that I've got. In the Riverside portfolio … we have $40 million in healthcare premiums."

She then assumed a 20 percent increase.

"That's $8 million, and pick any multiple you want – I think I used 7.5 – that is $60 million of lost equity value to the Riverside portfolio and to the firemen and policemen who have invested with us," she said.

The healthcare discussion turned to talk of driving healthier behaviors.

"If you have strep throat, you shouldn’t go to the emergency room because it costs $1,500 to walk through the door," she said. "The net result of that has been, over five years, we've dropped our loss ratios to 75 percent."

She described the loss ratio as the measure that insurance companies use to say of each dollar I'm giving you, how much of that are you spending to cover your claims?

"And 80 percent is great," she said. "At 75, we're even better than great. So we would expect that our rate increase should be pretty low."

Editor's Note: ObamaCare Secrets Revealed

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Pam Hendrickson, the chief operating officer of the Riverside Company, said three years from now maybe we'll all say Obamacare was the greatest thing that ever happened, but the transition rules have not been well thought out.
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2013-09-28
Friday, 28 June 2013 07:09 AM
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