What's wrong with Obamacare

Matthew Hoy
By Matthew Hoy on December 15, 2013

To borrow a line from "Best of the Web Today": Longest blog post ever written.

I'm not going to actually try to provide a one-stop post detailing every screw-up surrounding the president's signature health insurance reform. I've spent a lot of time over at my "second job" posting link after link after link to stories of Obamacare SNAFUs, FUBARs and glitches.  If Democrats continue to hold fast to defending the clusterf— that is Obamacare, I can see a decade or two of GOP dominance (if they don't screw it up), simply because those swing voters in the middle aren't going to quickly forgive or forget what's been done to the health insurance, doctors and hospitals they liked.

While much of the reporting in the past couple of months has been focused on Obamacare horror stories, make no mistake there will be "winners" in this debacle—even if it's only limited to those who will be going on Medicaid due to the expansion of that program to people at 400 percent of the poverty level. (And those new Medicaid enrollees might be wary of what they're getting.)

The recent focus has been on the "losers" because of that old journalism saw: "If it bleeds, it leads." You can get some "happy" stories about the Obamacare winners, but the ones that are gripping, the ones that people remember, are the horror stories.

Which brings me to this article from a couple weeks ago courtesy of the New York Times.

Mike Horrigan is a lifelong Democrat with heart problems who supports President Obama’s health care law because he expects it will help many people obtain better insurance, including himself.

But under the new law, the Affordable Care Act, Mr. Horrigan’s coverage by a state high-risk insurance program was eliminated, then replaced by a more expensive plan. His wife’s individual plan was canceled for being substandard, then suddenly renewed — also at a higher price.

Here's the big problem with Obamacare: Mike Horrigan is supposed to be a winner under the program, instead he's a loser.

Horrigan was one of those disadvantaged under the old system. He had a pre-existing condition. He was difficult to insure. He got his insurance through a high-risk program run by the state.

One of the key equalizers in Obamacare was that health insurance companies could no longer charge sicker individuals more than healthy ones. (Which effectively made health insurance companies no longer health insurers, but healthcare "facilitators" of some sort.) So, apply that Obamacare regulation to Horrigan and what should you expect to happen?

You expect Horrigan's costs to go down. He's now supposed to be subsidized by the premiums of all those healthy people. Their costs should be higher than they would be pre-Obamacare, and Horrigan's should be lower.

But it isn't.

Why?

I suspect it's some combination of the ridiculous one-size-fits-all mandates that Democrats put into the legislation (does Mr. Horrigan really need maternity coverage?) and the government and insurance companies trying to torture actuarial tables to produce some numbers they were never designed to produce so the companies don't simply go bankrupt by guessing wrong.

Imagine the idiots in Washington passing a law that says that you can't have different auto insurance rates based upon age, gender and driving history. Now, suddenly, insurance companies have to figure out how much to charge so they can stay a going concern when they can't charge different prices to a 16-year-old "invincible" boy and a 45-year-old mother of two. That's what they've done to the health insurance market.

It's quickly becoming obvious that Obamacare (not just the web portal) isn't going to do even the smallest portion of what President Obama and the Democrats promised. It's not going to solve the problem of 30 million uninsured Americans. (In fact, it's very likely that due to the 5 million-plus individual plan cancellations and the slow pace of Obamacare enrollments, that there will be more uninsured Americans on Jan. 1 than their were on Sept. 31.) It's not going to bend the cost curve down. It's not going to improve peoples health outcomes.

Is the average family going to save $2,500 over their 2009 premiums under Obamacare? No. It's likely that the only people who save money under Obamacare are those who are put on the expanded Medicaid program  or receive heavy subsidies.

Back to the Times article:

Rachel Bryant, a small-business owner who lives just outside Winston-Salem, felt unlucky when she received a notice from Blue Cross saying that her plan was being canceled and that the replacement would raise her monthly bill to $675 from $408.

But when Ms. Bryant, a single mother of two young children who earns about $30,000 through her legal services business, finally succeeded after many tries to log onto the online marketplace, HealthCare.gov, she learned she was eligible for subsidies that would bring down her premiums to just $150 a month.

“I’m extremely happy,” said Ms. Bryant, 36. “I’m not going to go bankrupt because of medical bills. I’m looking forward to it, and I’ll put up with the frustration and the bother.”

Well, she had insurance before, so she wasn't going to go bankrupt. But if she could afford $408 a month for her health insurance, can someone explain to me why the government wants to raise that price to $675 and then put other taxpayers (or the Chinese) on the hook for $525?

Any honest individual with a basic grasp of math will quickly understand that this funding model is not sustainable.

I believe President Obama when he says he will block any repeal of Obamacare while he is president. I suspect there are enough Americans like the Horrigans who will continue to whistle past the graveyard and keep enough Democrats in the House and Senate to prevent a 2/3rds majority to override a veto.

But it won't long survive Obama's departure.

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