We have had to devote many posts every month to this fiasco since last August. The fallout from the worst piece of legislation ever enacted by Washington just keeps on giving and messing up Americans’ lives. This month is no exception. We will probably need most of this week to cover it all, that is how bad the law is many, many months after it was rolled out in such a disastrous manner last fall.
As with previous months, we will likely stop talking about it this month not because we ran out of material but because it can get so depressing going over the damage the legislation is doing to lives, health, freedom, and the economy.
1) The most recent, most fascinating and likely most uplifting news about Obama Care we have ever seen came about last week as a result of a court decision. Before we get into the decision, let’s review how Obama and his Congressional cohorts set up the law in the first place:
- The centerpiece of the legislation was the concept of setting up state government developed and operated health insurance exchanges.
- These exchanges were to be online, Internet portals where theoretically a person could log on to the exchange’s website, put in some personal and financial information, and be offered a wide ranging set of Obama Care health insurance policies to choose from to insure themselves and/or their families.
- Additionally, if the person or family applying via the exchange for insurance had a low enough income level, they would be offered Federal subsidies to help defray the cost of their Obama Care insurance policy.
- If a state did not establish an Obama Care exchange in their state, an option that was written into the law, then citizens in those states could still get Obama Care insurance coverage via the national Federal online insurance exchange.
- The Obama administration offered two incentives to encourage the states to set up their own Obama Care exchanges. The first incentive was monetary support for the programming and development of the state’s exchange software.
- The second incentive was the requirement that those Federal subsidies to help defray the cost would only be available to citizens in states that had built their own online Obama care exchange. Anyone who got their Obama Care insurance via the Federal exchange were explicitly made NOT eligible for subsidies in the legislation.
However, their logic backfired when a large majority of state governments said no thanks to both incentives and defaulted their citizens to the Federal exchange, an option that the legislation prevented those people from getting subsidies. When the backfire became clear, the Obama administration blatantly ignored the legislation itself and illegally proclaimed that everyone, regardless of what exchange they used, would get subsidies, a clear violation of the language of the law.
Well, it did not take long for the lawyers and lawsuits to get started and last week the DC district court ruled that the administration had violated its own law by unilaterally voiding the Federal exemption portion of the law. If this decision holds throughout the appeals process, millions of Americans would lose financial help in paying for their Obama Care policies which would likely result in the great many of them cancelling their Obama Care insurance policies.
Renee Nal, writing for the Liberty Unyielding website, had the following observations and media clips regarding this potentially fatal ruling for the worst piece of legislation ever enacted:
- The majority of people who sign up for Obama Care are expecting to be subsidized by the taxpayer in order to keep their insurance affordable but the ruling “threw out a federal regulation that implements key subsidies that are vital” to the survival of the Affordable Care Act.
- According to Reuters: “The ruling has the potential to cripple the implementation of the law by making health insurance unaffordable for many people.
- According by the Daily Caller last month: “According to the data from federally-run Obama Care exchanges alone, subsidies will cost $11 billion — and if state-run exchange customers qualify for subsidies at the same rate, Obama Care subsidies will total $16.5 billion for 2014 alone. The Congressional Budget Office last projected that subsidies would cost $10 billion in 2014.” That money would now be reduced dramtaically as a result fo the court ruling: good news for taxpayers, bad news for many policiy holders.
- As reported last month by Newsweek, “[A]bout 85 percent of the 8 million people who have enrolled in private coverage under Obama Care sought subsidies, according to the administration."
2) The Heritage Foundation also had some thoughts and analysis on the court ruling and the potentially fatal impact it might have on the legislation:
- Heritage finds that there will be severe ramifications if the decision survives appeals. First, as we explained above, only customers who got insurance coverage through a state exchanges would be able to get Federal subsidies.
- Individuals who used the Federal exchange would face costly premium increases as their subsidies were terminated.
- Since the Obama care employer mandate penalties are linked to the availability of the subsidies, employers would now not be subject to the penalty in those states that did not establish a state exchange, taking the pressure off of businesses in those states to offer insurance to their employees or face fines.
- Those states would now have a competitive business advantage over states that forced their in state businesses to comply with Obama Care, a factor that would encourage business development to a grow faster in those non-Obama Care exchange states.
- Since some states did such a horrible job of setting up their state exchanges, many of them are terminating those state efforts and forcing their citizens to use the Federal exchange which would likely result in even more people not being eligible for Obama Care subsidies.
Additionally, many states who initially opted to not establish an exchange did so because by 2015 states are required by law to fund the operating expenses of the exchanges on their own. Furthermore, grant funding that was originally included in the law to help states establish state exchanges is gone, and it is highly unlikely Congress would be willing to appropriate additional funds toward this endeavor.
What a mess. People who thought they were getting low cost, subsidized insurance will now have that subsidy removed, likely resulting in cancelled policies, likely resulting in higher insurance rates for those Obama Care policy holders that still remain, likely resulting in more policies getting cancelled as premiums go up, likely resulting in insurance companies wanting to get out of the business of Obama Care altogether unless they get taxpayer bailout money, etc., etc., etc.
This death spiral would likely terminate the law under its own incompetence and weight, which would be a good thing. However, as we mentioned above, we would have wasted four years and billions of dollars and be no closer to resolving the problem of ever rising health care costs. Maybe if Obama had listened to his critics back in 2009 and 2010 rather than assuming he knew best, progress on this problem would have been made rather than picking up the remnants of his own making.
3) Mark Meckler,wirting for the American Spectator had some interesting and depressing observations about Obama Care that we have touched on before but which are worth reviewing again here:
- Recall that the President promised that the average American family would see their health care bill go down by about $2,500 a year.
- But a county-by-county study by Forbes and the Manhattan Institute found that the average cost for individual, i.e. non-employer provided insurance, insurance policies actually rose by 49% on average rather than going down by $2,500 over the past few years.
- The people whose rates go up most are those who are young, healthy, and/or male which is not surprising since the whole underpinning of Obama Care was to get healthy, younger people to pay for the health care and insurance of older, sicker people.
- The Forbes study found that individual health insurance rates went up in 80-90% of U.S. counties.
- The law is going to force about a million low income people to pay up by assessing a financial penalty for those that did not sign up for an Obama Care policy.
- Think about the idiocy of that last statement. A low income American who cannot afford health insurance is going to be forced to pay a penalty for being so poor and after paying the penalty will still not have health insurance. Insanity.
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