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Dumping on MassCare

In the world of investing, the term pump-and-dump refers to a "scheme that attempts to boost the price of a stock through recommendations based on false ... statements. The perpetrators of this scheme ... sell their positions after the hype has led to a higher share price."

Put more simply, they get in, "use" the system, and get out, generally at a profit. This costs the company, and it costs the other shareholders.

But what, you may ask, does this have to do with health insurance?

Well, before there was ObamneyCare©, there was MassCare. And an integral part of MassCare has been Guaranteed Issue, coupled with immediate coverage for pre-existing conditions. Or, as the Boston Herald's Frank Quaratiello reports:

"A gaping loophole in state insurance rules that lets freeloaders pick up coverage to pay for expensive surgeries — and then dump it once they’re treated — has cost taxpayers as much as $37 million a year"

There's even a term for this: "jumpers and dumpers.” Jump and dump, pump and dump; tomato, tomahto.

But that's just a Bay State problem, right?

Not so much, "according to a study that warns the same wrinkle in Obamacare could add a staggering $2 billion a year to the deficit-wracked federal budget ... similar provisions in the nation’s new health care plan could cost the government at least $1.9 billion a year starting in 2014 when Obamacare kicks in."

Ooops.

Glad we passed the bill to learn what's in it.

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