Obamacare does not seem to be working as expected in the State of Minnesota.  Its state-based health exchange known as Mnsure received a major blow with the announcement that its lowest cost insurance provider, Preferred One, will be pulling out.

Preferred One had garnered 59% of the Mnsure customer base by offering the lowest premiums of any of the four remaining insurance providers.  But the company indicated that continuing to do so was “not sustainable” given the administrative burdens associated with running the plans.

TwinCities.com notes that another consideration may have come into play for Preferred One.  University of Minnesota economist Roger Feldman explained that Mnsure’s private insurance market may have been too small to warrant Preferred One’s commitment to the exchange.  Of the 327,000 Minnesotans on Mnsure, only 54,600 are enrolled in private insurance plans.  The remaining 272,000 are enrolled in publicly funded health care either through Medical Assistance (Minnesota’s Medicaid plan) or MinnesotaCare, a subsidized health care plan for low income people between 138% to 200% of the federal poverty level.

And since nine out of ten enrollees on the federal exchange receive taxpayer subsidies to help cover their Obamacare premiums, it’s fair to say that most of the 54,600 Minnesotans enrolled in private health plans on Mnsure are receiving subsidies as well.  Fox News reports Obamacare subsidies are available for people making up to 400% of the poverty level which translates to approximately $45,000 for individuals and $94,000 for a family of four.

What does all this tell us?  Obamacare is not the readily accessible, affordable health care that it has been billed to be.  It only gets by with tremendous, ongoing public support and even then, health care providers like Preferred One are finding the system “not sustainable”.

But there’s more to the story.  Many Americans do not realize that health insurance companies also receive taxpayer subsidies in return for their Obamacare participation.  Powerline blog explains,

“Through 2016, taxpayers will subsidize insurance companies’ losses. Such subsidies were considered necessary to induce carriers to participate in the government-sponsored exchanges, despite the likelihood that the risk pool on the exchanges would be unfavorable. The fact that a company with 60% of the Obamacare exchange market considers the business unsustainable, even with federal subsidies, is ominous.” (Emphasis added.)

No matter what side of the Obamacare exchange you’re on – the customer side or the insurance provider side – you need a government subsidy to make participation economically viable.  And even with subsidies, insurance companies and health care consumers are finding that the Obamacare model does not work.

So while the national media remains mum on the Mnsure story and the Obama administration continues to talk up Obamacare as a well-oiled machine, Americans find themselves with a health care system patched together with bandaids – bandaids in the form of taxpayer subsidies, implementation delays, high deductibles, and narrow networks.