Posted: Thu Mar 25, 2010 7:06 pm
It does not remove the current medical insurance system yet. But there is legislation that has been proposed to add it back onto the law.
The current law mandates that everyone is forced to buy insurance, and goes so far as to hire 16,000 additional tax agents solely to review people's insurance coverage and determine if it meets some arbitary minimum level. The goverment will provide subsidies for low and mid income families, but it also places the majority of the tax burden on that same group (figure I read was over 60% will be placed on families making within 300% of the poverty level - ie. $66K for a family of 4). The exceptions built in are for the President, Senate, Congress, and other high-ranking goverment officials.
The idea of the exchanges is by forcing more individuals to buy, you increase the risk pool thereby dropping the normallized cost. But there's a MASSIVE FAILURE in the way it's designed. If an individual does not sign up for insurance, they are fined $1500/yr payable as part of their annual income taxes; however, the annual cost of the insurance will be higher than that $1500. So what will happen is people will opt out of the insurance (reducing the risk pool and driving costs up) until they're sick. Then, because insurance can't refuse them, they'll sign up after they've become sick. They'll stay in just long enough to recieve treatment, then drop out again so they can save the money. So the insurance company is going to be stuck with limited-term, high-cost customers only. They'll be forced to raise rates. Except they won't be able to because their pricing is mandated by the Fed, so they'll go out of business. This means the government will be "forced" to become an insurance provider (after all, they already own the banks, the car companies, etc.). Presto-Chango - You have single-payor system.
On the business side, if a company doesn't offer a "good enough" insurance plan, they are subject to fines. If they offer too good of one, their employees must pay a "cadillac tax". But, if they just say "screw it" and don't offer any, they don't have to deal with being auditted, pay the same (and possibly more) in fines, and don't have their own out-of-pocket expenses for the insurance. Effectively, there is zero upside to the company offering their employees health care. Again, this will shift people to the government controlled "exchange". See the scenario above.
Add to all this the fact that NO social medical program run by the US government has EVER come in on budget (they average 5x-9x the original estimated price) and this program being scored as costing $940 BILLION dollars, and it that was scored BEFORE finding out it didn't cover children and needing to be amended. That's right - If a child has a pre-existing condition, they can STILL BE DENIED COVERAGE. They are having to put through another amendment to correct that, and that cost was not tallied into the original cost... The middle of a global recession, while the country is facing possibly losing its AAA bond rating, is NOT the time to go shifting 1/6th of our national economy under government control. And before someone blames Bush for the debt, at the height of the war we were running $102 billion a year in deficit spending. Since Obama has taken over, we're spending $90 billion. A MONTH.
There are a whole plethora of reasons to hate this law and it's forthcoming amendment. Depending on the poll you read, between 53% (most liberal) and 70% (most conservative) of the US populous was AGAINST it. I am not opposed to reducing health care costs, but there were MUCH better ways to do it. Tort reform (limiting the liability a doctor has in a lawsuit) would have been an EXCEPTIONAL move, it's doing wonders in Texas. It was offered up by the Republicans, but was only added last-minute by Obama / Reid / Pelosi for experimentation in a limited number of small districts as a way to try and get a Republican to vote for the bill so they could claim it was a bi-partisan bill. Why? Because the Democrats are strongly supported by the Trial Lawyers lobby. Removing the restriction on insurance companies to compete across state-lines would have driven down costs. Allowing "Catastrophic Healthcare Insurance" plans would have helped. Health Spending Accounts and Medical Saving Accounts... There were a LOT of other ways to go. Better ways.
The current law mandates that everyone is forced to buy insurance, and goes so far as to hire 16,000 additional tax agents solely to review people's insurance coverage and determine if it meets some arbitary minimum level. The goverment will provide subsidies for low and mid income families, but it also places the majority of the tax burden on that same group (figure I read was over 60% will be placed on families making within 300% of the poverty level - ie. $66K for a family of 4). The exceptions built in are for the President, Senate, Congress, and other high-ranking goverment officials.
The idea of the exchanges is by forcing more individuals to buy, you increase the risk pool thereby dropping the normallized cost. But there's a MASSIVE FAILURE in the way it's designed. If an individual does not sign up for insurance, they are fined $1500/yr payable as part of their annual income taxes; however, the annual cost of the insurance will be higher than that $1500. So what will happen is people will opt out of the insurance (reducing the risk pool and driving costs up) until they're sick. Then, because insurance can't refuse them, they'll sign up after they've become sick. They'll stay in just long enough to recieve treatment, then drop out again so they can save the money. So the insurance company is going to be stuck with limited-term, high-cost customers only. They'll be forced to raise rates. Except they won't be able to because their pricing is mandated by the Fed, so they'll go out of business. This means the government will be "forced" to become an insurance provider (after all, they already own the banks, the car companies, etc.). Presto-Chango - You have single-payor system.
On the business side, if a company doesn't offer a "good enough" insurance plan, they are subject to fines. If they offer too good of one, their employees must pay a "cadillac tax". But, if they just say "screw it" and don't offer any, they don't have to deal with being auditted, pay the same (and possibly more) in fines, and don't have their own out-of-pocket expenses for the insurance. Effectively, there is zero upside to the company offering their employees health care. Again, this will shift people to the government controlled "exchange". See the scenario above.
Add to all this the fact that NO social medical program run by the US government has EVER come in on budget (they average 5x-9x the original estimated price) and this program being scored as costing $940 BILLION dollars, and it that was scored BEFORE finding out it didn't cover children and needing to be amended. That's right - If a child has a pre-existing condition, they can STILL BE DENIED COVERAGE. They are having to put through another amendment to correct that, and that cost was not tallied into the original cost... The middle of a global recession, while the country is facing possibly losing its AAA bond rating, is NOT the time to go shifting 1/6th of our national economy under government control. And before someone blames Bush for the debt, at the height of the war we were running $102 billion a year in deficit spending. Since Obama has taken over, we're spending $90 billion. A MONTH.
There are a whole plethora of reasons to hate this law and it's forthcoming amendment. Depending on the poll you read, between 53% (most liberal) and 70% (most conservative) of the US populous was AGAINST it. I am not opposed to reducing health care costs, but there were MUCH better ways to do it. Tort reform (limiting the liability a doctor has in a lawsuit) would have been an EXCEPTIONAL move, it's doing wonders in Texas. It was offered up by the Republicans, but was only added last-minute by Obama / Reid / Pelosi for experimentation in a limited number of small districts as a way to try and get a Republican to vote for the bill so they could claim it was a bi-partisan bill. Why? Because the Democrats are strongly supported by the Trial Lawyers lobby. Removing the restriction on insurance companies to compete across state-lines would have driven down costs. Allowing "Catastrophic Healthcare Insurance" plans would have helped. Health Spending Accounts and Medical Saving Accounts... There were a LOT of other ways to go. Better ways.
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