Wednesday, June 28, 2017

June, 2017, Part 2, The Unfolding Disaster That Is Obama Care: Dwindling Obama Care Competitors and Dwindling Obama Care Customers

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, sugar, 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 copays 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.

1) Tyler Durden, writing for the Zero Hedge website on June 13, 2017, did a great summary of the status of Obama Care’s failures across a number of dimensions:

  • The first analysis at the county level across the country for 2018 Obama Care policy coverage shows that 47 counties will have no access to Obama Care insurance policies.
  • Even though residents of those counties cannot get access to an Obama Care policy, they will still have to pay the fine for not having insurance.
  • According to the Federal government’s Medicare and Medicaid Services organization (CMS), as a result of the 47 counties not having access to Obama Care insurance policies, 35,000 Obama Care policy owners in will now lose access to their current policies.
  • While 47 counties currently look like they will have access to no Obama Care policies next year, CMS estimates that as many as 1,200 counties across the country will have access to only one Obama Care option in 2018 despite Obama promising that the legislation would increase the number of insurance competitors in an area.
  • CMS said it expects these trends to get worse over time, i.e. fewer and fewer Obama Care competitors being in the market.
  • In the following map, red areas show counties with no Obama Care competitors and the yellow areas show counties with only a single Obama Care competitor:

  • Even though CMS executive Seema Verma claims that CMS and state insurance commissioners are working to slow the erosion of Obama Care competitors, this is viewed as only a potential short term slowdown effort: “This is yet another failing report card for the Exchanges. The American people have fewer insurance choices and in some counties no choice at all. CMS is working with state departments of insurance and issuers to find ways to provide relief and help restore access to healthcare plans, but our actions are by no means a long-term solution to the problems we’re seeing with the Insurance Exchanges.” 
What a mess. As always with big government programs, politicians' solutions put forth as solutions usually make the original problem worse. In this case, even though Obama promised that his name sake law would increase the number of competitors in the market which would reduce health insurance costs, the above numbers show that Obama Care has had the exact opposite effect: less competitors which probably explains the annual double digit increase for Obama Care insurance premiums.

2) But it is not just dwindling competitors that is a problem with Obama Care. There is also a problem with the dwindling number of people carrying Obama Care insurance policies:

  • Scott Fidel of Credit Suisse recently pointed out that the number of Obama Care customers has shrunk at a greater rate this year than previous years.
  • The number of current Obama Care customers vs. the number that signed up for Obama Care policies during the last sign up period is down 15.4%, i.e. 15.4% of those that signed up for Obama Care policies half a year ago are no longer Obama Care policyholders, either having stopped paying their premiums or who signed up for an Obama Care policy but never paid any premiums.
  • 12.2 million signed up for Obama Care late last year but only 10.3 are currently active policyholders.
  • This percentage drop off was higher this year than the two previous years’ drop off.
  • Remember that Obama promised that over 20 million Americans would have Obama Care policy coverage by now, meaning that the legislation missed its objective by 50%, a failure under any measurement approach. Also, remember that reputable analysis sources estimate that between 6 and 7 million Americans lost access to their current and preferred policies as a result of Obama Care.
  • This means that the true incremental impact of Obama Care was not 10 million Americans getting health insurance coverage via an Obama Care policy but only 3 to 4 million incremental Americans getting insurance policies as a result of Obama Care. Thus, Obama Care missed its 20 million target but 16 to 17 million net new policies, an embarrassing failure.
Dwindling customers and dwindling competitors, sounds about right. More failures to follow.

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