For Connecticut governor, gun swagger will soon give way to political woes over health care

Reuters

Connecticut Gov. Dan Malloy speaks to the media outside the West Wing of the White House in Washington, December 2, 2010,

Article Highlights

  • Eleven accident and health insurers are headquartered in Connecticut, including the giant Aetna

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  • If Obamacare fails in Connecticut it will capture national notice

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  • Almost everyone in Connecticut is going to have to pay more for health insurance starting next year

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  • The plans that Connecticut will offer in its new exchange could be among the nation’s costliest

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When President Obama brings his gun proposals to Hartford, Connecticut today, using the state’s recently enacted restrictions as a backdrop to push for federal firearms limits, Mr. Obama should also use the occasion to ask Connecticut Governor Dan Malloy about his State’s troubled efforts on another Presidential priority — Obamacare.

Governor Malloy took to CNN this weekend in an unusually snarky interview, to thumb his nose at the legal gun industry, much of which is headquartered in his state. No doubt, he’s hoping that his legislative win on a state gun bill, and his turn in the national stage, will help stem some of his declining poll numbers back home.

But there’s another American industry that’s also headquartered in Connecticut: the nation’s insurers. If Governor Malloy is counting on the gun legislation to boost his standing in progressive circles, stumbles on Obamacare could erase any new margins.

Eleven accident and health insurers are headquartered in the state, including the giant Aetna Inc (NYSE:AET). If Obamacare fails in Connecticut it will capture national notice — and will come at bad time for a Governor seeking re-election in 2014.

Mr. Malloy was one of the first among the nation’s Governors – Democrat or Republican — to set about establishing a state based exchange under Obamacare. He set up a cabinet level department to spearhead the task. Connecticut spent more than $100 million in federal money alone erecting the initial architecture.

Governor Malloy’s early enthusiasm for Obamacare has produced some early results for his state. None of them are encouraging.

It’s now clear that options offered in the new Connecticut insurance exchanges will be among the most expensive nationwide. At the same time, the price for health coverage in the remaining private insurance market (mostly for small businesses) is set to spike this fall

Almost everyone in Connecticut is going to have to pay more for health insurance starting next year. Governor Malloy’s early embrace of Obamacare, like the gun legislation, elevated his standing in national progressive circles and helped fuel his political ambitions. It hasn’t turned out as well for Connecticut residents.

In the “Constitution State,” unless you work for a large, self-insured company, there is simply no way out of the looming healthcare problems.

A draft proposal released in January lays out the costs that consumers could get saddled with.

Take these examples: Co-pays for a doctor visit will run consumers between $40 to $45 (against a current Connecticut average of $23.79) according to one estimate released by the State. Plan deductibles will be up to $3,000 for individuals and $6,000 for families (against a 2011 State average of $1,331 and $2,500 respectively).

For those who buy insurance outside the exchanges — in the small group market (mostly small businesses) — rates starting this fall are estimated to rise between 20 and 25 percent according to a report from independent analysts. Connecticut’s aggressive embrace of the Obamacare regulations and the State’s long list of insurance mandates is at least partly to blame for putting Connecticut ahead of other states in the looming premium hikes.

Price hikes will be especially steep for those under the age of 30.

That’s because the current Connecticut rules let insurers charge six times more for the oldest people than for the youngest, who are typically healthier. The new Obamacare rules let companies charge just three times more for older, and often sicker clients. Younger workers will be forced to subsidize the older beneficiaries.

Connecticut took some of its own decisions that will add to the costs of the new coverage. The board that governs the Connecticut exchanges voted to forgo competitive bidding for insurers that will offer health plans under Obamacare.

The same board also weakened provisions meant to ensure that there are enough providers in the networks that these plans offer. It nixed a monitoring study (one being used in other states) that’s designed to make sure that providers listed on an insurers’ network are really available to provide care to beneficiaries.

The Connecticut Governor’s office didn’t return a request for comment.

Governor Malloy should hope that Mr. Obama brings more than a pat on the back when the President travels to Hartford today to help spike the football over Malloy’s gun win. Perhaps a federal job of some kind. With his national media tour in full swing, maybe that’s what Governor Malloy is angling for.

Because once Connecticut residents learn that they can’t escape the Governor’s fumbles on Obamacare; the Governor may hope he can escape Connecticut.

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