Tuesday, November 24, 2015

November, 2015, Part 2, The Unfolding Disaster That Is Obama Care: Costs Conitnue To Skyrocket While Enrollment Continues To Crater

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 doctor2, 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) One aspect of Obama Care that we have not discussed recently is the employer mandate that forces employers to offer their full time staffs health insurance options or be fined $2,000 a year per employee. Previously, we have reported how hundreds, if not thousands of companies, could not afford either option, providing health insurance or paying the fine, and as a result took two actions in order to stay in business. 

First, many business owners made sure that most of their employees never worked enough hours to be considered full time employees, defined by Obama Care as those working more than 30 hours a week. The law allowed businesses to avoid paying the fine or providing health insurance coverage for those part time workers. The second option was to insure that businesses fell below certain thresholds of total number of employees employed.

Thus, Obama Care’s insurance coverage regulations reduced working hours of thousands of Americans, turning them into part time employees, without giving them the benefit of health insurance coverage, or restricted job and economic growth, denying a lot of unemployed Americans the opportunity to get a job.

But another problem has arisen as Obama Care has unfolded. It seems that even when businesses tried to offer health insurance to their currently uncovered employees, the vast number of employees decided to pass on the opportunity. 

For example, consider the situation of Billy Sewell who employs 600 restaurant employees at the Golden Corral restaurants he owns. He tried to do what the Obama Care legislation told him to do, i.e. offer a company sponsored health insurance program to all of his employees. 

Despite trepidations that his business could not afford to do so, he went ahead and offered health insurance to all of his 600 employees. His costs turned out to be far lower than anticipated because a grand total of TWO employees took him up on his insurance program offer. Why? It was too expensive even with Sewell picking up a majority of the insurance tab. 

And according to New York Times reporting, Sewell and his experience is not unique. Many small business companies with over 100 employees are finding that very few of those employees are taking the health insurance when offered. Michael A. Bodack, an insurance broker in Harrison, New York: “Based on what we’ve seen in the marketplace, we’re advising some of our clients to expect single-digit take rates. One to 2 percent isn’t unusual.”

Brad Mete, the managing partner of Affinity Resources, a staffing agency in Dania Beach, Fla., began offering insurance in 2015 to avoid the $2,000 per employee fine. He also saw a very low take on those employees who signed up for his company’s new insurance program. The cost of insurance to his employees is $30 a week to many of his employees who make $300 a week. Thus, many decided that giving up a whopping 10% of their weekly earnings for insurance is not worth it, given that there are annual deductibles that have to be met before the insurance coverage kicks in.

Which comes back to the point we have been making over and over during the past few years of covering the unfolding disaster that is Obama Care. The law never addressed the root causes of our high insurance costs, as listed above. As a result, insurance costs did not go down and we are now seeing that even when offered health insurance coverage through their company, it is still too expensive for the employees of companies that Obama Care forced to starting offering an insurance program.

2) Rich Edson, writing for Fox News on October 27, 2015, did a nice job summarizing the insurance policy cost increases that are going on around the country as people enroll in Obama Care policies for 2016:

  • The Department of Health and Human Services recently announced that the average cost for the average “silver” plan on the Obama Care Federal exchange will go up 7.5% in 2016.
  • Keep in mind that Obama frequently promised that the typical American family would see up to a $2,500 reduction in their annual insurance premium costs, not a 7.5% INCREASE.
  • In Oklahoma, the silver plan average will go up a whopping 36%, in Alaska the cost will go up about a third, and more than 34% in Montana.
  • Some states will actually see an average decrease with Indiana silver Obama Care policy holders seeing about a 13% decrease and those in Mississippi seeing an 8% decrease.
  • These double digit increases may be the reason that Obama Care is now forecasted to attain no more than half of the enrollees it expected and promised when the law was passed, 10 million enrollees vs. the 20 million forecasted.
  • According to Robert Laszewski, president of the Health Policy and Strategy Associates: "Insurance companies by and large are losing lots of money in Obama Care. Obama Care's got some really serious problems here and the enrollment, the only way for Obama Care to solve problems is for enrollment to increase dramatically." 
  • But if enrollment does not go up the financial losses will mount which will force more increases in the cost of Obama Care policies which will cause fewer people to keep their insurance which will force more increases in costs = death spiral.

Higher costs, lower than expected enrollments, disaster.

3) Richard Pollock, writing for the Daily Caller on November 1, 2105, reported that the increase in Obama Care policies in 2016 will not be 7.5% as described above but upwards of three times as much. Why? Because the Obama administration released cost increase information for only “silver” plans but withheld cost increase information for the other three types of plans that are available under Obama Care.

When the cost increase for the other plans, bronze, gold and platinum,  are considered, the cost increases for ALL Obama Care plans jumps to over 20%. Which obviously means that if the silver plans were at 7% or so, than the other plans must be experiencing increases that are much higher than the average of 20%. 

The Daily Caller News Foundation found the following bad news for Obama Care policy holders once one looks at all types of Obama Care policies:

  • Some Obama Care policies in Utah will see a 45% price increase.
  • In Illinois, the highest price increase will be 42.4%.
  • In Tennessee, the highest price increase will be 36.3%.
  • In South Dakota, silver plans will increase 24.7% in 2016 but the average increase across all plans will be 39%.
  • In South Carolina, the average silver increase will be 10.8%, compared to 23.4% when all four plans are considering.
  • In Colorado, silver customers will see a 12.94% price hike, but Gold users will see a 20.33% increase, and Platinum enrollees will see a 29.80% price rise.
Another case of the Obama administration not being transparent in publishing only a subset of data or an honest mistake? Given there has been very little honesty in any aspect of this administration, I vote for lack of transparency...again.

That will do it for today’s unfolding Obama Care disasters. Unfortunately, more disasters will be unveiled tomorrow.

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