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On the Third Hand: Deadbeat Sam, Part 2

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The U.S. Department of Health and Human Services (HHS) now says it officially has little hope of collecting more than $362 million in risk corridors program money.

Health insurers have sent in claims for about $2.9 billion in risk corridors receivables.

Drafters of the Patient Protection and Affordable Care Act of 2010 (PPACA) developed the program in an effort to use cash from PPACA exchange plan issuers that do well in 2014, 2015 and 2016 to help exchange plan issuers that do poorly in those years.

The program was supposed to encourage insurers to participate in the PPACA exchange plan program, and to keep prices for health coverage as low as possible.

On the one hand, health insurers are run by grownups who understand that Democrats rammed PPACA through Congress without getting even a fig leaf of Republican swing-voter support. Some plans may have been too quick to trust HHS officials’ glowing promises about how the risk corridors program would work.

The HHS officials have weakened any right they have to get any help with bailing the program out by seeming to run the risk corridors program from inside a cave deep in the recesses of the facilities in which federal researchers keep the corpses of invading space aliens in pickle jars.

See also: On the Third Hand: Shadowy risk corridors

But, on the other hand, it just seems to be bad policy for Uncle Sam to set up a financing program, then yank the program away and (metaphorically) yell, “Suckas!” just because one party hates the other party.

See also: On the Third Hand: Deadbeat Sam

We have a deeply divided government running a deeply and genuinely divided country. Sometimes philosophies will change. If that means government financing programs or other government programs with a big financial impact will turn upside down while companies are in the middle of a fiscal year, and have no ability whatsoever to avoid the problems, how can companies ever think of trying to do business with the government?

If the government continues to act like that, it will have no choice but to eliminate use of contractors and simply do everything itself, with any workers brave enough to depend on the idea that the federal government will send out paychecks, because no vendors will dare to do business with the government.

On the third hand, maybe this is an early sign that the United States is over, and that its government should shut down, because pretending that we have a country functional enough to make good on business obligations, or to send out paychecks, is foolish.

Maybe we can put the whole country through a bankruptcy reorganization process and persuade a private equity firm to acquire any national assets that prove to have a little resale value.