Wednesday, October 14, 2015

October, 2015, Part 3, The Unfolding Disaster That Is Obama Care: The Financials Keep Getting Worse, Another Failed Co-Op and More

Every month for years now we have had to discuss how bad Obama Care is turning out to be under the continuing theme, “the unfolding disaster that is Obama Care.” This month is no different. As the legislation continues to march through America, driving up health care and health insurance prices as it serves as dead weight on economic growth, it cements it rightful place as the worst piece of legislation Washington has ever produced.

It never had a chance to be successful since it really never addressed the underlying root causes of our ever increasing health costs in the country:
  • Americans eat too much of the wrong kind of food, resulting in obscenely high obesity rates for the country.
  • Our food chain is infested with overdoses of high fructose corn syrup, salt, and other unhealthy additives.
  • Americans smoke too much.
  • Americans do not exercise enough.
  • The country is in serious need of health care tort reform.
  • Barriers to insurance company competition across state lines need to come down.
  • Obama Care never “followed the money” to find out who is actually profiting from the ever escalating healthcare costs in this country and how to get those factors under control.
  • Obama Care never got the immense amount of fraud and abuse in current government healthcare programs, Medicare and Medicaid, under control in order to save money to efficiently fund other government health care initiatives.
  • Obama Care never put serious research money towards curing the major diseases that drive high healthcare costs such as high frequency cancers and dementia type diseases.
You cannot resolve any problem unless you understand and address the underlying root causes. No difference here but with a big exception: Obama Care legislation never addressed these listed root causes and thus, has no chance of ever being successful.

But it is not just missing the root causes of our healthcare costs that makes Obama Care so horrible. It resulted in millions of Americans losing access to their favored doctors, hospitals, and insurance policies. It has caused deductibles and co-pays to escalate substantially. It will likely add trillions of dollars to the national debt. It has exposed millions of Americans to higher than necessary identity theft chances. It has created government bureaucracies that are wastefully spending taxpayer wealth and being exploited by criminal elements. It has stifled economic growth and job creation.

These are just a sample of the types of idiocy that we have been reviewing for the past several years in this blog relative to Obama Care. To read those past posts, just enter the phrase, “the unfolding disaster,” in the search box above.

For the next several days we will be reviewing the latest unfolding disasters from the worst piece of legislation ever written by Washington:

1) The Congressional Budget Office recently released new, ten year budget outlook for the Federal government. Buried inside this massive document was a 15 page section that focused solely on the financial costs of Obama Care over the next ten years.

Before we review their forecasts, let’s take a trip back in time for a short review of what Obama promised when he was trying to get Obama Care passed:
  • Obama Care would result in an American family of four seeing upwards of a $2,500 reduction in their annual health insurance costs. 
  • The cost of Obama Care to the Federal government would be only about $90 billion a year over the ten years.
  • Not a single dime would be added to the the Federal debt.
  • Middle class families would not see an increase in taxes to pay for the legislation.
  • The objective was to get every American covered under some sort of health insurance policy.
Those were some of the promises, or outright deceptions depending on your perspective, that helped to pass the legislation. This is what the Congressional Budget Office thinks of the law today:
  • It will cost the American taxpayer a whopping $50,000 for each American who gets health insurance coverage under Obama Care.
  • The Federal debt will increase by $1.35 Trillion in order to provide this coverage.
  • The actual cost will be an amazing $1.993 Trillion, a trillion dollars more thanObama promised, which will be offset by $643 billion in new taxes, fees, and fines.
  • The majority of that $643 billion in taxes, fees, and fines, all of which is a tax regardless of what you call it, will be paid by middle class and poorer Americans, killing the notion that the middle class will not be paying more in their lives as a result of Obama Care.
  • If some of the tax provisions in the law are actually eliminated as some in Washington want to do, the medical device tax and the Cadillac tax, then the Federal government cost and debt will be even higher.
  • In a BEST CASE scenario, between 24 and 27 million Americans will obtain health insurance coverage at the end of the next ten years as a result of Obama Care leaving tens of millions of Americans still without coverage and far short of the promise of universal coverage.
But none of these depressing financial results should come as a surprise. Many experts predicted these realities years ago but the mainstream press and this administration did its best to keep it hidden. Jonathan Gruber, the MIT economics professor who helped birth this abomination was on public record bragging that those in the know helped fool the Congressional Budget Office initially in giving a rosier than realistic view of Obama Care’s likely financial implications.

So what we end up with is a massive fail vs. what Obama promised: American families are not seeing a $2,500 reduction in their annual health insurance costs, the cost to the Federal government is way beyond $90 billion a year, well over a trillion dollars is being added to the national debt, middle class families are seeing their costs for the whole law going up via taxes, fines, and fees, both directly and indirectly, and over 20 million Americans will still be without health insurance ten years from now. 

Seems like your could not screw this up any more if you tried.

2) Earlier this week and in previous posts we have discussed the reality that almost all of the 23 Obama Care health insurance co-ops are in serious financial trouble. At least two of them already having declared bankruptcy and have told their thousands of Obama Care policyholders to find other types of insurance since they will soon no longer exist,making their policies void.

Well, we can now add another co-op to that list of failed ventures since Nevada Health C0-Op has announced that it is completely going out of business beginning January 1, 2016. This co-op had obtained $65 million in taxpayer backed loans to get the business started, $65 million of which is now likely a total waste relative to taxpayers. Their official reason for going out of business: “challenging market conditions.”

This co-op had promised it would sign up about 33,748 customers just in 2014 alone but so far, well into 2015, it has only signed up about 14,000, well less than half of its projections. As a result, its business case, which had predicted the co-op would earn $371,000 profit in 2014, ended up losing over $15 million. Which raises the obvious question: who put together that business case? How can one be that far off to go from a predicted thin profit to a massive loss of $15 million?

But Nevada is not alone.According to a Heritage Foundation analysis, only one of the original 23 co-ops is actually profitable. thirteen of the 23 co-ops severely missed their forecasted and promised enrollment levels in 2014. IN Nevada’s situation, their 14,000 customers need to find other insurance options by the end of the year or go without insurance.

The two other co-ops that have already announced their plans to go out of business are in Louisiana and the Midwest. Together they obtained about $210 million in taxpayer loans to get started, loans that are now likely never to be repaid.

Okay, three days into the latest unfolding disasters from Obama Care and we are not close to being done. More to follow tomorrow but let’s close out today with another set of stories from ordinary Americans that have had their lives, their health, and their families upset and stressed out because of Obama Care. The source of today’s horror stories comes from the website,

Judy from Minnesota on November 22, 2013

My employer could not “keep our current medical plan”. And Minnesota is not going to honor Unpresidential Obama’s “fix” to keep those previous plans. The changes resulted in horrible changes for me. I have Multiple Sclerosis and Coronary Artery Disease. I will now NOT be able to receive my MS medication nor 3 of my cardiac medications. They are not on “the formulary” (I guess the government gets to prescribe for me – not my doctor). My MS medication has kept me virtually relapse-free for over 10 years.

My cardiac medications barely balance my heart symptoms.

My previous out of pocket maximum used to be $3,750 with a $750 maximum prescription out of pocket, it would now be $5,350 with no maximum on prescription drugs.

I cannot afford over $550 per month to stay alive. The insurance broker even said I would be better off quitting my job (as a Registered Nurse), losing everything I own (including my house) and then apply for Medicaid! I WON’T do it!! See you at my funeral….

Bill from Minnesota on December 5, 2013

Under Obama Care, no longer can insurance companies price their policies based on prior experience. Like the old goal of Communism, everybody pays the same, whether they strive to be healthy, or smoke 3 packs a day and overeat to the point they are obese.

Our 32 employees have tended to be healthy with one or two exceptions, and as a result, we have earned a so called co-efficient of .75 in recent years, the lowest co-efficient allowed under current insurance law. Obama Care silently eliminated the use of co-efficients that were based on a companies prior claims. Thus, without that coefficient, our similar plan (co-pays up to $40 from $35, and out of pocket max, single/family, from $2800/$6500 to $4000/$8000), went from $165,000 per year to $243,000 a year or a 47% increase for a company that made a profit last year of just $187,000. That $78,000 increase would reduce our profit to $109,000 for a potential profit margin of 2%, all other things being equal. At that small a margin, our company could end up losing money and eventually going out of business.

Obama no longer wants his creation called “Obama Care”. I agree, it should be called UN-ACA, the Un-Affordable Care Act.

Jonathan from Minnesota on November 20, 2013

I wanted to pass on this information on to a news source in hopes that you can do something with it. My name is Jonathan Gerster and my wife and I live in Eagan, MN. I recently bought health care insurance this past October from Health Partners hoping that my wife and I could find something affordable. We found a premium for 57.83 a month for the most basic care and covers the things that we felt were pertinent for me. Unfortunately, on January 1st, my premium jumps to $124.75 and includes several parts of healthcare that I never wanted to pay for in the first place.

I thought that we were told by the Federal Government that my premiums were supposed to go down? That’s why I got health care insurance in the first place. My wife and I have over $100,000.00 in student loans and we can’t afford to pay this much a month for my premium. I don’t want to go on the public dole and switch to Federal health care insurance but I also don’t want to pay the $95 fee for not having health insurance. Where is my voice in all of this? Is this the freedom that we truly want?

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