Thursday, July 14, 2016

July, 2016, The Unfolding Disaster That Is Obama Care: Costs Likely To Conintue Rising, Customer Base Likely To Continue Shrinking and The Obama Administration Likely to Continue To Break The Law

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 its 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: 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 insurance premiums, 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.

This week we will be reviewing the latest unfolding disasters from the worst piece of legislation ever written by Washington:

1) Haley Johnson, writing for the Conservative Daily News website on June 28, 2016, reviewed the dire warnings about Obama Care in 2017 that were recently pronounced by the very person that helped Obama Care when she worked in the Obama administration. Marilyn Tavenner was once the head of the Centers For Medicare and Medicaid Services and helped launch Obama Care.

When she was recently asked what the immediate future held for Obama Care policy premiums costs, she replied: “I’ve been asked, what are the premiums going to look like? I don’t know, because it also varies by state, market, even within markets. But I think the overall trend is going to be higher than we saw previous years … that’s my big prediction.”

Whoa, hold on there! When she was rolling out Obama Care, didn’t her boss, the President claim that the annual costs for health insurance for families could down up to $2,500 a year? Didn’t he promise that the legislation would “bend the cost curve” of health care downwards? And now that very same person, who currently leads a health industry organization of insurers, is telling us that those promises are not going to come true? Horrors!

Of course, that is sarcasm. We have often shown how the cost of health insurance premiums, deductibles, and co-pays have gone up substantially under Obama Care, the exact opposite of what was promised. 

Anyone with a lick of common sense five years ago would realize that the Obama Care requirement that insurance companies must take anyone customer on and give them insurance coverage regardless of their current health condition was a recipe for disaster, as pointed out by Ms. Tavenner: “The problem with the exchanges … is people are still kind of seeing this as, ‘I use insurance when I’m sick, but I may not need it when I’m no longer sick."

Tavenner also correctly pointed out that the initial programs Obama Care put in place to cushion the blow of insurance companies having to accept anyone applying even if they had a pre-existing condition are going away. Once that financial crutch is removed, the Obama Care insurers will need to increase their premium rates even more to cover this new shortfall, further increasing Obama Care policy costs.

But again, anyone with a spec of common sense could see this coming years ago. We talked about it in this blog for months at a time. And now a former Obama administration insider is telling us the same thing: Obama Care will not reduce anyone's health insurance costs in any way and the shock of continually increasing deductibles, premiums, and co-pays is going to get worse not better in the coming year or so.

2) Well, maybe we do not have to wait a year to see if Ms. Tavenner’s predictions come true. According to an article for Breitbart that was written by Caroline May on July 14, 2016:

  • An amazing 1.6 million Obama Care customers have dropped their Obama Care coverage already this year.
  • This drop of 1.6 million customers happened in the remarkably short timeframe from late January, the end of the annual enrollment period, and the end of March, according to data from the Federal government.
  • 12.7 million customers had enrolled in Obama Care policies prior to January 31, 2016 but that number dropped to 11.1 million customers just two months later, an almost 13% decline.
  • The measurement for the drop is the number of people who signed up for an Obama Care policy during the enrollment and who were still paying their premiums and keeping their policy active by the end of March.
  • Remember, the original estimate is that by this time, Obama promised that about 20 million Americans would have healthcare coverage via Obama Care policies, so having 11.1 million now means that the program has missed its objective by about 50%.
  • And that assumes that no other Obama Care policy holders terminated their accounts in the past four months which would make that 13% drop even worse.

Now it could be that some of those in the 1.6 million got health insurance via a new job, or got health insurance coverage from a spouse’s new job, or qualified for Medicaid. Or more likely, Ms. Tavenner was right and these Obama Care customers decided that the increases in premium costs for Obama Care policies was just not a good value despite the fact that 85% of Obama Care customers get an average subsidy of $291 a month. 

With a handful of the remaining Obama Care co-ops under financial duress, a lot more Obama Care policyholders might be dropping out of the program before long, leaving the promise of 20 million people covered by Obama Care policies even further out of view. You cannot claim that you ran a successful program when you missed our own program objective by 50%.

3) We mentioned above and in previous posts how the programs set up to provide subsidy help in the initial years of Obama Care to help insurers financially ease into the Obama Care insurance world were expiring, putting additional financial stress on Obama Care insurers. Some of these insurers, seeing the writing on the wall of terminating subsidies and negative financial results from Obama Care policies, have already withdrawn from the Obama Care exchanges.

Alexander Hendrie, writing for the Americans For Tax Reform website on July 7, 2016, pointed out that Congressional committees recently issued a report that alleged that the Obama administration was illegally using taxpayer money to secretly, and probably illegally, to bailout Obama Care insurers. 

The report was put out by the House Ways and Means Committee and the House Energy and Commerce Committee. It accuses the administration of illegally funding Obama Care’s “Cost Sharing Reduction” (CSR) program for years despite the objections of IRS officials.

Key findings of the Congressional report, as written by Mr. Hendrie, include the following accusations:

-The administration initially submitted a CSR appropriations request for Fiscal Year 2014, but later withdrew it and began making payments illegally. As the report notes, Obama Care created CSR payments, but they have never been appropriated for. The Constitution explicitly makes clear that the power of the purse lies with Congress and the Executive cannot spend taxpayer money without Congressional approval.

-CSR payments were created as one way to artificially hide the true costs of Obama Care through a web of government spending programs. CSR payments would be given to an insurance company based on the income of an enrollee and the plan they purchased. Assuming certain criteria were met, the insurance company would receive federal dollars as an incentive to keep co-payments, deductibles, and other out of pocket costs low.

-After officials from the Obama Department of Health and Human Services (HHS) withdrew the CSR appropriations request, the administration begun illegally shifting funds from a separate appropriation. The administration has refused to provide the legal memorandum that led to this decision even in the face of Congressional subpoenas.

-IRS officials expressed concern that this method of funding CSR payments was illegal so were briefed on the memorandum. As the report notes in an interview with one IRS official at the meeting, they were not permitted to take notes or keep a copy of the memo:

“We were given a memo to read. We were instructed we were not to take notes and we would not be keeping the memo, we’d be giving it back at the end of the meeting.”

-Following this meeting, IRS officials continued to have concerns that the CSR payments violated federal law and raised concerns with IRS Chief John Koskinen. As the report notes, these concerns were heard, but ignored:

“The IRS officials’ concerns that this course of action violated appropriations law were noted, but not addressed or ameliorated by OMB’s legal memorandum.”

-Shortly thereafter, DoJ and Treasury officials officially approved the decision to use an unrelated appropriation to make CSR payments.

Since Congress launched its investigation, multiple Obama government agencies have undertaken a concerted effort to hide the truth by refusing to provide, or unlawfully redacting documents, refusing to answer questions or allow witnesses to testify, and selectively applying the law. In at least one case, the Obama administration pressured a witness into not revealing information, and in another case the administration prevented a witness from answering questions.

As the report notes:

  • The Department of the Treasury improperly withheld and redacted documents without any valid legal basis to do so.
  • The Department of Health and Human Services improperly withheld documents without any valid legal basis to do so.
  • The Office of Management and Budget improperly withheld documents without any valid legal basis to do so.
  • The Department of the Treasury failed to search for records responsive to the committees’ subpoenas.
  • Treasury used regulations and Testimony Authorizations to prohibit current and former IRS employees from providing testimony to Congress about the source of funding for the CSR program.
  • Treasury officials selectively enforced the law by allowing witnesses to answer certain questions prohibited by the authorizations without objection
  • HHS counsel prevented witnesses from answering substantive questions regarding the CSR, citing the need to protect “internal deliberations” and “confidentiality interests”
  • Witnesses were instructed not to reveal the names of White House and DoJ officials involved in decisions regarding the cost sharing reduction program.
  • The Department of the Treasury pressured at least one witness into following the restrictions set forth in his Testimony Authorization after the witness questioned Treasury’s ability to limit his testimony.
  • OMB prevented a witness from answering factual questions regarding the dates or times of a meeting or conversation, refusing to invoke a legal privilege to justify withholding the information from Congress.
Breaking the law, illegally bailing out the insurance companies, tampering with potential witnesses, and failing to provide the requested documents to Congress, sounds about right when describing the worst piece of legislation ever enacted and the most lawless administration in my lifetime. And of course, the American taxpayer ends up paying the insurance company for this lousy piece of legislation.

4) One last piece of ObamaCare nonsense for today. I usually do not reference random pieces of writings that are sent through my email, I almost always want to rely on professional, legitimate, and identified news sources and government findings for our discussions in this blog. But the following, unsourced description of what Obama Care is does hit a home run in showing how inane the logic was in putting it together. It boils down the 2,000 pages of the legislation and the 10,000 ages or so of regulations as related to Obama Care to four succinct points: 

1. In order to insure the uninsured, we first have to un-insure the insured.

2. Next, we require the newly un-insured to be re-insured.

3. To re-insure the newly un-insured, they are required to pay extra charges to be re-insured.

4. The extra charges are required so that the original insured, who became un-insured, and then became re-insured, can pay enough extra so that the original un-insured can be insured, so it will be free-of-charge to them. 

Crazy and illogical and passed by the U.S. Federal government.

That will end our Obama Care review for both today and this month, things have been a little slow in this area. But we now know that a former, high ranking Obama Care insider predicts that costs will go up and not down as Obama constantly promised, that current Obama Care customers are dropping out of the program at a very quick rate, and that the lawlessness of the Obama administration extends and continues in this area with regard to blackmailing insurance companies with taxpayer money to stay in the program and continue to provide Obama Care policies. The unfolding disasters continue to unfold.

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