Wednesday, July 24, 2013

July, 2013 Obama Care Update, Number 1: The Complete, "Dirty Dozen" Inventory of Failures To Date

With all of the other political class insanity going on, insanity that required us to use eight consecutive posts to cover it earlier this month, we have been ignoring the biggest insanity of them all, Obama Care. The failures within the overall structure of the Obama Care legislation have been mounting up on almost a daily basis. Thus, we are going to take a few days to cover all of the disasters and hardships that this fatally flawed legislation is dumping on America and Americans.

To set the stage of the next few days, let’s review a list of sub-failures within the overall failure that is Obama Care, as documented by the Heritage Foundation. This will give us a context of how much is falling apart within the law. We will follow up these “dirty dozen” global failures with more detailed news of other failures in subsequent posts.


The CLASS component of Obama Care was supposed to provide quality, reasonably priced long term health care to cover the potential costs of nursing home stays. However, it became the first of many failures of Obama Care when Obama’s Health and Human Services (HHS) department admitted early on that the CLASS parameters could never be implemented in a financially sound manner.

Even a Congressional Democrat called the CLASS Act “a Ponzi scheme of the first order, the kind of thing that Bernie Madoff would have been proud of.” Congress eventually repealed this component of Obama Care because of its insanity.

The bad news from a financial and taxpayer perspective was that CLASS was supposed to be one of the few positive financial contributors to the overall profitability of Obama Care. Once it was repealed for being idiocy, the overall Obama Care financials went from horrible to worse than horrible.

2. Health Care Exchanges: MISSED DEADLINES

Health care exchanges were an invention of Obama Care and are supposed to be places where Americans without health care insurance could go and purchase low cost health care insurance. Each state was supposed to set up their own state exchanges and allow different insurance companies to present their insurance plans and compete for customers.

Obama Care made the exchanges optional for the states and promised that if the states elected not to operate their own state based exchanges, the Federal government would step in and operate a Federal exchange in that state. As a result of the voluntary aspect of the legislation, the majority of states opted out of setting up their own exchanges to save the expense of operating one and let the Feds operate them in their states, increasing the cost, complexity, and likelihood of failure of the exchange process.

And the likelihood of failure is getting larger as time goes by. A Government Accountability Office (GAO) report released in June found that “critical” activities to create a federal exchange have not been completed, and the missed deadlines “suggest a potential for challenges going forward.” It seems like in this case, “challenges” is a government code word for “failures.”


Last year, the Obama administration announced a partial delay for Obama Care’s birth control mandates, mandates that would go against the tenets and beliefs of various religious organizations and business owners. This is a blatant attack on the Constitution’s freedom of religion protection.

However, many employers, e.g. the Hobby Lobby retail chain, have filed legal actions against the mandates, which forces them to fund products they find morally objectionable or pay massive fines. Thus, if the court actions are successful, and chances are some of them might be successful, given how many there are, another component of Obama Care would have gone down in flames.

4. Small business plan choice: DELAYED

The original plan of the health insurance exchanges was that people could go to the Obama Care exchanges to get a choice from a menu of competing health care insurance plans. But the Obama administration basically admitted in April that this choice option will not be ready on time for the small business health exchanges. i.e. there will only be one choice and one choice only.

This breaks another promise of Obama Care. Liberal blogger Joe Klein called “a really bad sign” of “Obama Care incompetence.” “Really bad sign,” I believe is yet another code word for “failure.”


According to the Heritage Foundation analysis of the legislation, something they call a “drafting error” in Obama Care has led to less access to health care for children with pre-existing conditions. A 2011 report found that in 17 states, health insurers are no longer selling child-only health insurance plans as a result of Obama Care because they fear that individuals will apply for coverage only AFTER being diagnosed with a costly illness.

6. Basic health plan: DELAYED

This government-run plan for states created as part of Obamacare, has also been delayed. According to Heritage, one Democrat criticized the Administration for failing to “live up” to the law and implementing the plan as it written in the legislation.


Like everything else the political class and government do, this program for individuals with pre-existing conditions is mired down and much higher costs and much lower enrollment than originally forecasted. This program was originally expected to cover up to 700,000 Americans.

However, only about 110,000 people have enrolled and the Administration has already had to halt new enrollments into the program since the $5 billion program is already running out of funding. This halt had to occur even though it has attained only about 14% of its expected enrollment. As a former professional forecaster in the corporate world, if my forecasts had been off by such a wide margin I would have been fired for incompetence.

8. Early retiree reinsurance: BROKE

More bad forecasting. The original $5 billion in funding for this program was supposed to last until 2014 but the program’s money ran out in 2011, years ahead of schedule.


After the legislation originally passed, HHS found that some of the law’s mandates would raise costs so much that employers would drop coverage rather than face skyrocketing health insurance premiums. This forced the administration to grant temporary waivers of compliance, which only delayed the pain of Obama Care. More than half of the waivers went to union health insurance plans even thought most unions were supporters of the legislation when it was being debated and written. Talk about hypocrisy.

10. Co-ops: DEFUNDED

In early 2013, Congress blocked additional funding to this Obama Care program, and with good reason: In one case, a new health insurance co-op was called “fatally flawed” by Vermont’s state insurance commissioner.

11. “Employee free choice”: REPEALED

This provision, which would have allowed certain workers to use contributions from their employers to buy exchange health plans, was repealed in April 2011. Apparently, businesses generally considered it too complex and unworkable.

12. Medicaid expansion: REJECTED BY MANY STATES

In its 2013 ruling on Obama Care which found it Constitutional, the Supreme Court also made Obama Care’s Medicaid expansion optional for states. The court ruled that Obama Care, as it written and enacted, engaged in “economic dragooning” that puts “a gun to the head of states.” Many states are rejecting Obama Care’s call to expand Medicaid, knowing that expansion will saddle them with additional, unsustainable costs going forward.

There you have it in a very succinct direct description, the “dirty dozen” major failures of Obama Care. Consider the words used to accurately describe what has happened since the legislation was passed: Abandoned, delayed, repealed, broke, unintended consequences, rejected, defunded, and underperforming. Hardly a robust endorsement of the law.

Has any other piece of legislation in our history been written so poorly, so poorly thought out, and so poorly executed as this piece of garbage? As any piece of legislation ever been so blind to the root causes of an issue, in this case, our high and rising health care costs? Has any piece of legislation ever had such a negative impact on economic growth and unemployment?

The answer to these questions is an easy “no.” No legislation has ever been so horrific as this legislation. And in the next few days we will get under these major disasters to examine some of the other disasters and disgraces that are unfolding underneath these more global issues and failures.

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