The Washington Post has an article today about Obamacare that everyone needs to read. In a nutshell, here are the main points:
1. Obamacare's exchanges are failing. The estimate by the government three years ago was that there would be 24 million policies sold on the exchanges by 2016. Only 11 million were sold this year. That means that less than half of the estimated number of policies were sold.
2. Three of the largest insurers, United Healthcare, Aetna and Humana are pulling out of offering individual policies in most states. These carriers have suffered major losses on their policies because there are just too few policies sold to cover the medical costs of those who are covered. This will leave one in four counties in the USA with only one carrier offering plans in 2017. Imagine that. One quarter of the USA will have no choice of healthcare policies. Even worse, there will be some counties for which no policies are offered.
3. Across the USA, states are authorizing major price increases for the policies that will be sold. Many of the increases are more than twenty five percent.
4. Even among the people who receive subsidies to buy insurance, there are a great many people who just don't buy policies. The penalty for not buying insurance is still less than the cost of the policy for many, and the huge deductibles in most policies make the care delivered by the policies extremely expensive in any event.
Barring any changes to the system, Obamacare will not be able to last much longer. If more carriers pull out of the system, we could see large swaths of the country in which NO policies are available. That would make the legacy of Obamacare the complete destruction of the health insurance industry and the loss of coverage for millions of people. Oh, and it would all come at a cost of about a trillion dollars.
Some of the same "experts" who explained why Obamacare would work in the first place now tell us that we just need to increase the penalty for not buying insurance. If we could force millions more into the system, we would have their premium payments to cover the cost of medical care for the others. Understand what that means. The goal of these experts is to get something like seven million young and healthy Americans to pay something like $3,000 per year for coverage that won't kick in until they meet a $5000 deductible or something close to that. We that to happen, we would see more than twenty billion dollars in additional premium revenues for the carriers, but remember where that money will come from. It would be an additional burden on all those young people who are at the point in their lives where they normally would be buying first homes, cars, and other major purchases. By sucking twenty billion dollars a year out of their pockets, Obamacare would then cause the housing market damage. It would damage the auto market. It would damage the economy in a major way. In most ways, the "cure" would be worse for the country than the current mess.
The way to fix Obamacare is to focus on ways to get people better and less expensive care rather than on ways to get people insurance that has major gaps in coverage. First of all, remember that Obamacare costs the US taxpayer enormous amounts each year. Just jettisoning the Obamacare bureaucracy would free us tens of billions of dollars each year that could better be spent on care. There is no reason why each policy sold has to include maternity benefits, birth control, abortions, and a whole host of other items that many people do not want. The one size fits all approach of Obamacare clearly has failed, and it needs to go. We also could modify the laws that pile excess costs onto hospitals in order to improve care but lower costs. Treating a sick person at an emergency room costs as much as ten times as treating the same person at a walk-in clinic or a doctor's office. If the law were changed to people who came to the ER without a real emergency got sent to such a clinic, costs would take a significant cut.
There are a whole host of other moves that could be taken, but nearly all of them start with getting rid of Obamacare. Of course, we could just wait another year or two and watch Obamacare dissolve by itself after inflicting a great deal more damage on the USA.
1. Obamacare's exchanges are failing. The estimate by the government three years ago was that there would be 24 million policies sold on the exchanges by 2016. Only 11 million were sold this year. That means that less than half of the estimated number of policies were sold.
2. Three of the largest insurers, United Healthcare, Aetna and Humana are pulling out of offering individual policies in most states. These carriers have suffered major losses on their policies because there are just too few policies sold to cover the medical costs of those who are covered. This will leave one in four counties in the USA with only one carrier offering plans in 2017. Imagine that. One quarter of the USA will have no choice of healthcare policies. Even worse, there will be some counties for which no policies are offered.
3. Across the USA, states are authorizing major price increases for the policies that will be sold. Many of the increases are more than twenty five percent.
4. Even among the people who receive subsidies to buy insurance, there are a great many people who just don't buy policies. The penalty for not buying insurance is still less than the cost of the policy for many, and the huge deductibles in most policies make the care delivered by the policies extremely expensive in any event.
Barring any changes to the system, Obamacare will not be able to last much longer. If more carriers pull out of the system, we could see large swaths of the country in which NO policies are available. That would make the legacy of Obamacare the complete destruction of the health insurance industry and the loss of coverage for millions of people. Oh, and it would all come at a cost of about a trillion dollars.
Some of the same "experts" who explained why Obamacare would work in the first place now tell us that we just need to increase the penalty for not buying insurance. If we could force millions more into the system, we would have their premium payments to cover the cost of medical care for the others. Understand what that means. The goal of these experts is to get something like seven million young and healthy Americans to pay something like $3,000 per year for coverage that won't kick in until they meet a $5000 deductible or something close to that. We that to happen, we would see more than twenty billion dollars in additional premium revenues for the carriers, but remember where that money will come from. It would be an additional burden on all those young people who are at the point in their lives where they normally would be buying first homes, cars, and other major purchases. By sucking twenty billion dollars a year out of their pockets, Obamacare would then cause the housing market damage. It would damage the auto market. It would damage the economy in a major way. In most ways, the "cure" would be worse for the country than the current mess.
The way to fix Obamacare is to focus on ways to get people better and less expensive care rather than on ways to get people insurance that has major gaps in coverage. First of all, remember that Obamacare costs the US taxpayer enormous amounts each year. Just jettisoning the Obamacare bureaucracy would free us tens of billions of dollars each year that could better be spent on care. There is no reason why each policy sold has to include maternity benefits, birth control, abortions, and a whole host of other items that many people do not want. The one size fits all approach of Obamacare clearly has failed, and it needs to go. We also could modify the laws that pile excess costs onto hospitals in order to improve care but lower costs. Treating a sick person at an emergency room costs as much as ten times as treating the same person at a walk-in clinic or a doctor's office. If the law were changed to people who came to the ER without a real emergency got sent to such a clinic, costs would take a significant cut.
There are a whole host of other moves that could be taken, but nearly all of them start with getting rid of Obamacare. Of course, we could just wait another year or two and watch Obamacare dissolve by itself after inflicting a great deal more damage on the USA.
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