If You Like Your Obamacare, You Can Keep It

Unknown-1The President repeatedly said that if you like your health plan, you can keep it (“no matter what,” he even added). He forgot to add: IF the government likes your plan too.

He says he “regrets” people being screwed because they relied on his words. It’s an “apology” akin to those saying, “I’m sorry if my remarks offended anyone” — not sorry about the words themselves, or admitting they were wrong — i.e., a non-apology.

So now all the millions with cancelled insurance are being told: your old plan wasn’t any good anyway, and the government will help you get a better one (once the website is fixed*).

Until then, Obamacare seems to mean more people losing insurance than gaining it. But the real story is the paternalism of government telling folks it knows their insurance needs better than they do, and the new plans will be better because they cover more. What about all those preferring a cheaper plan – cheaper, because it doesn’t cover so much? Tough luck. Government has decided every health plan must cover maternity care, for example; so even if you’re a sixty year old male, you’ve got to have (and pay for) a plan that covers maternity.

Unknown-2It’s another classic case of Liberal Disease: the belief that anything desirable should be required. So if it’s ideally nice for a health plan to cover maternity care, and much else, now it’s all required, for everybody, want it or not.

This is the syndrome responsible for lack of affordable housing. Apartments must meet so many rules and regulations for niceties, raising their cost, that simple cheap rooms the poorest can afford are unavailable. Likewise day care: providers must meet so many government requirements that there’s no cheap day care. And all these requirements were created by the same do-gooder liberals who bemoan the inevitable results, lack of affordable day care and housing. Now they’re doing the same for health insurance.

It was always clear that a key feature of Obamacare is to get insurance to lower-income people by having government (i.e., taxpayers**) subsidize it. So the affluent are paying for the non-affluent. Nothing new there. However, in addition – this is the sneaky part – the healthy are paying for the sick.

Unknown-3That’s what’s really going on with all the requirements for insurance plans. It’s not a “bug” that many folks are forced to pay for a lot of coverage they don’t need, it’s a design feature: another way of sucking money from some people to pay for the health care of others.

UnknownTrue, the very concept of an insurance pool is to spread risk. Everybody pays a little for fire insurance so that the occasional fire is covered. But the difference with Obamacare is that it isn’t voluntary. We don’t get to decide for ourselves whether to participate in this pooling of risk. We’re thrown into the pool.

The administration says that when the dust settles, many people will actually pay less for insurance. My wife was one whose plan was cancelled, and we did get another, through the New York website, a little cheaper. For now.

But the future viability of the whole Obamacare scheme depends on its working as hoped – that is, all the sheep obediently line up for shearing – all the young and healthy people sign up for more health coverage than they really need or want, in order to pay for all the older and sicker folks. imagesIf instead the insurance plans attract too few suckers***, they will hemorrhage money treating the old and sick, causing next year’s rates to rise substantially – thus attracting even fewer healthy young people. And so on, a vicious circle that unravels the whole thing.

* Rather than trying to fix it on the fly, wouldn’t it have made more sense to call a time-out and close the website temporarily for repairs?

** Or more borrowing from China.

*** Yes, there’s a penalty for non-insurance, but for most people it’s much less than the insurance cost. Also, the penalty is on your tax return, and query how well the severely understaffed IRS can police it – will they verify that people claiming to be insured really are?

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8 Responses to “If You Like Your Obamacare, You Can Keep It”

  1. WhamaJama Says:

    There is so much bombast here it’s difficult to point to just one thing to comment on. The post seems intended just to get a rise from us progressives, so I will ignore most of the superficial reasoning by saying a single-payer system would have indeed worked better but conservatives made that politically unachievable. So, we are left with a second-best option which appears clearly superior to the prior status quo. At least it invests in our citizens health and has begun a wholesale national debate on the subject of health care which was before a matter of much hand-wringing but little action.

    I do feel compelled to point out the absurdity of the footnote implying government “debt” with China as a problem (and this is an example of the problem with the entire post that though the author may deny it, the words here are not sterling logic but intended to scorn and to entertain those who would tend to agree with the author’s views, and thus it should not surprise the author for the same words to attract scorn for those like me who do not).

    Nations are not households. They do not incur debt by mortgaging assets (say, highways, warplanes, or national parks). No, the reason others, like China but mostly corporations doing business globally, buy our debt is to have a place to park their dollars safely. Since corporations are often touted in this blog as superior economic structures guided by pragmatic principles, their choice to hold our debt should itself be sufficient to underscore the superiority of our Nation. But since the author obviously feels troubled by the debt, let’s continue. These entities park their dollars here because they trust in the strength of our Nation and our economic prowess. Since our debt is denominated in dollars and we can always print as many dollars as the Treasury requires, it is always an illusion that the debt cannot be repaid. But, again, these debt holders do not invest here because they hope to someday own chunks of the country if we “default”. They park their dollars here because they trust it is the safest place to do so. When we provide through U.S. securities a place for the dollars washing around the globe, and rational economic players buy that debt, it becomes possible to use those dollars for purposes that enhance the Nation’s core strengths: investments in our infrastructure (capital) and the health and welfare of our citizens (labor). If we fail to make these investments, we do gradually erode the faith and credit others have in the United States so it really is an imperative that we are good stewards of this responsibility. However, conservatives and libertarians alike seem unable to understand how modern economies actually work and seriously consider returning to artifices such the gold standard or worse equate their own household budgeting around the kitchen table with matters of state, losing any real perspective.

    Consider this simple example.

    Say, you have a business idea. You draft a business plan and seek investors. Part of that plan involves going to a bank to get a loan for the business. How does the bank decide whether to give you a loan? They look at you as a person. They look at your business plan, your backing. They look at your credit history. If these intangibles look promising, they will probably invest. They will then type some key strokes into a computer and magically dollars will appear in your account. They will not check to see if they have enough cash left over after considering the Federal Reserve’s reserve requirements. They will simply invest in You. That is essentially what China does when it decides where to park its cash. It looks at our character as a Nation, the solidity of our planning, the views of other investors, and our history of repayment and they say, this, this is the place to invest in. Debt is not a burden for the modern nation-state unless it fails to make desirable investments in itself, in its capital and labor, in its infrastructure and citizens’ well being. In fact, it is a testament to our strength and prediction of the likelihood of our future prosperity.

    Stop playing games with words and using simple notions to make gratuitous points to entertain the like-minded. Our Nation’s health and prosperity deserve more than sideswipes and superficialities.

  2. rationaloptimist Says:

    1. Conservatives made single-payer unachievable? Not a single Republican in Congress voted for Obamacare. It was not some sort of compromise with conservatives. Democrats bear the total responsibility for what they chose to enact or not enact.
    2. As to borrowing from China, I was merely pointing out that since we have such large deficits, to say taxpayers are paying for any new spending is inaccurate. In fact, taxpayers are not paying; the money is being borrowed.
    3. Is that a bad thing? Not if it’s within reasonable limits. But WhamaJama seems to argue that there are no limits; that it doesn’t matter how much we borrow. That’s dreamland economics. We can argue about how much we can actually borrow with no ill effects, nobody really knows, but we’ll be testing it in the years ahead, as entitlement spending inexorably climbs. And to say we can just print money to pay any and all debts is frighteningly stupid. If it were true, why don’t we do it and pay off the whole $17 trillion or so? The reason is that it would destroy the value of the dollars printed. Your savings, WhamaJama, would become worth squat.

  3. bruce Says:

    Damn, I am so perfectly normal, I am the absolute center of health care’s wealth creation. Please congratulate me on being the focal point of the law’s fiscal calculations.

  4. Bumba Says:

    I’m still pissed off about having to have car insurance. And if people don’t have insurance, why should the government subsidize it? I mean the state governments pay for it already at the emergency rooms, hospitals, public clinics etc. Oh , well I suppose the govt/the taxpayers are already paying for it. Oh, I get it.
    As for myself, I pay high premiums. and I’ll continue to have high premiums as long as health care is a for-profit enterprise. The fee for service model inherently generates high costs.

  5. rationaloptimist Says:

    It’s not that health care is “for-profit,” or that fee-for-service “inherently generates high costs.” Rather, the problem, causing high costs, is that health care does not work like a market, where suppliers compete for customer dollars on the basis of price and service quality. This is the fundamental problem Obamacare sadly failed to tackle. See my past post on this subject; particularly the linked Steve Brill article on why prices for health care are what they are” https://rationaloptimist.wordpress.com/2013/07/26/how-we-can-be-healthy-wealthy-and-wise/

  6. Greg Says:

    I don’t like paying taxes either, but I understand the need to do so up to a degree.

    What Obama should have said is “you can keep your existing insurance plan if it meets the minimum coverage requirements in the law, and if your insurance company decides not to change it for a better one.” Bad bad Obama for not being precise. Three lashes with a wet noodle … now get on with being our President.

  7. zjmsdnudit@gmail.com Says:

    In fact, – unless we learn to think for ourselves, look after ourselves and be accountable – nothing is going to improve. My ex-husband was like this – inactive, infantile and demanding, now he’s sitting on imgur day adn night upvoting jokes about jerking off. In case you don’t fight, you lose it. Great article. xOxOx Sarah- http://phytoceramidesreviewstv.com/
    Sarah http://phytoceramidesreviewstv.com/

  8. จัดหาแรงงานต่างด้าว Says:

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