We already know that the Affordable Care Act is making insurance less affordable. Premiums are going up, not down, to pay for all the new mandated coverage.
But according to Steven Parente, who studies the medical industry, Obamacare could actually not only fail in its mission to reduce the number of uninsured but, but it will create a whole new class of people walking around without insurance.
Writing in the Wall Street Journal, Parente explains how this will work. He makes utter sense.
It boils down to this: Obamacare will make insurance even more expensive and than it is now, while the quality of care will decline as insurers limit your access to specialists and procedures in order to cover costs. A worse product for more money. But of course, market economics are not part of President Obama’s world, unless we’re talking book sales.
This will first impact the individual market, as those who insure themselves decide it’s better to take the federal tax penalty for not having insurance than buying an expensive, crappy plan.
Soon enough, the employer-provided market will also get hit as companies decide it makes excellent business sense to pay their own Obamacare fine and not cover their employees, dumping them into the individual market. Once dumped there, those who don’t qualify for taxpayers to pick up their bills via Medicaid will have the same individual market decision to make, and a certain number of these will pay the fine and forgo insurance too.
Voilà. A brand new population of uninsured people. Parente’s modeling suggests that when the smoke clears, more people overall will lack insurance due to Obamacare.
The process of making your insurance less affordable is about to accelerate, Parente writes, because insurers are about to incur more costs.
All plans—including those currently exempted for hardship and old plans extended for various reasons—must provide all of the law’s mandated benefits from Jan. 1, 2017 . . .
The law’s “reinsurance” program will also expire in 2017. Health insurers will no longer be able to bill the government for 80% of a patient’s health-care costs when they make more than $45,000 in annual claims. The multibillion-dollar risk corridors for insurance companies will also sunset in 2017—ending the taxpayer bailouts that kick in when insurance companies providing ACA plans lose money.
Insurance companies will have neither option by 2017, leaving consumers to pick up the tab through premium payments. Federal subsidies will be unable to keep up with such dramatic rate spikes.
So if you like your recent insurance price spikes, you can keep them, and then double down.
Higher costs, health care rationing, Death Panels, lousy care – we already know this is the future of Obamacare. Now add to that the sad fact of more uninsured people – AND UNINSURED PEOPLE PAYING A FINE AS WELL! – and you have a classic case of the Law of Unintended Consequences of Socialism.
The big winner here is the government, of course, whose purview over our lives never ceases growing.