Among the issues most commonly discussed are individuality, the rights of the individual, the limits of legitimate government, morality, history, economics, government policy, science, business, education, health care, energy, and man-made global warming evaluations. My posts are aimed at thinking, intelligent individuals, whose comments are very welcome.

"No matter how vast your knowledge or how modest, it is your own mind that has to acquire it." Ayn Rand

11 September 2009

The Essence of ObamaCare

First, we have to figure out what ObamaCare is. Is it something different than the various Democrat proposed bills before Congress? If we listen to Obama describe ObamaCare, we see that it is not consistent at all with the bills before Congress. For instance, he cannot resist saying that if you like your present health insurance plan, you can keep it. Nonsense, if HR 3200 is passed by Congress. So, this makes it seem plausible that his plan is different.

But, he also believes the debate has gone on far too long and Congress should hurry and pass a bill. It appears that whatever bill Congress passes, Obama will take credit for it and call it his plan. The plans now being considered by Congress, are apparently all this second-hander's bills, though he is said to favor HR3200. This, of course, makes Obama an out and out liar, given his description of his plan to the People.

What does Obama's plan consist of?
  • Everyone must have basic approved health insurance, though some covered by a company plan may have 5 years before that plan must meet approval criteria and union-negotiated plans may be exempt.
  • A basic plan is really a very comprehensive plan covering hospital expenses, doctor visits, prescription drugs, mental health, preventive care, substance abuse, and much, much more, with boards set up to add still more benefits as lobbyists make a political case for them. Plans cannot discriminate against those who are older or already diseased, obese, or with unhealthy lifestyles, so the young and the healthy will subsidize the older and the unhealthy. Obama says it is their duty to pay for such a gold-plated and charitable plan.
  • Low deductibles and co-pays are required. High deductible plans are outlawed. No co-pay or deductibles are allowed for preventive care. Health Saving Plans are effectively ended.
  • Low to moderate income individuals will be given a subsidy toward buying a qualifying health insurance plan to be paid for with new taxes and supposed savings from Medicare.
  • Additional very low income individuals will be qualified for the Medicaid program, which is already a huge burden on state and federal taxpayers.
  • Employers not offering an approved health insurance plan and paying a sufficient, but as of yet unstated, portion of the cost will be fined or taxed. HR 3200 makes this a tax of 8% of payroll.
  • Insurance companies will be taxed more, which they will have to add to the cost of their insurance plans.
  • High value health insurance plans will be taxed, unless they were negotiated under union contracts.
  • Taxes on high income individuals will be increased. The revenue increase is overestimated greatly.
  • Taxes on corporate foreign profits will be increased. The revenue increase is also overestimated.
  • Taxes on soft drinks may be increased.
  • Cost savings are to be found in the Medicare program to pay for part of the subsidies for insurance for low to moderate income individuals. CBO says these savings will not be anywhere near as great as Obama claims. Medicare has the statutory authority to reduce the money it will spend on elderly and disabled patients, since it can deny services that are not "reasonable and necessary," but the meaning of that has not been determined. Obama's and HR 3200's Independent Medicare Advisory Council has been tasked with defining "reasonable and necessary," so Medicare can start saving money on the elderly and disabled as Great Britain does with its NICE agency.
  • Obama claims preventive medicine will save money, but medical expert studies and CBO say it will cost more money.
  • Many new commissions and agencies are to be formed to watch over the health care system. The IRS will examine tax forms to see who qualifies for insurance purchasing subsidies. Other groups will study effective treatment procedures and require their use.
  • The government will set up a system of universal electronic medical records, presumably with the same success the Civil Aeronautics Board or the Immigration and Customs Enforcement have demonstrated with decades worth of failed computer and records systems. What will happen when they lose our records and there are no written records? What will happen when thieves steal our records?
  • Illegal aliens will not be covered, but no government agency or medical care facility will be allowed to determine who is legally present in the U.S. or not, so they will be added to the Medicaid roles or even be given insurance purchase subsidies, if they are paying taxes.
  • The CBO says the cost will be over $1 trillion in the next 10 years, but most of the expense is in the last 7 years. The CBO does not include $300 billion in additional interest payments on increased debt or the cost of the added federal and state bureaucracies to administer ObamaCare. The expense per year is to go up rapidly and there is much less expense for the first few years as the bureaucracies are set up and the interpreting regulations are issued. Obama now says it will cost $900 billion, but this is only to avoid using any number in the trillion range.
  • Obama said 30 million Americans who cannot afford health insurance will have coverage. CBO says only an extra 16 million Americans will have health insurance, since many who now have it will lose it when their companies decide it is cheaper to pay the tax than to insure them with the Obama gold-plated qualifying insurance plans. If the cost per year is as little as $190 billion/year when the program is underway, the cost per additional insured person will be $11,875 per year. That is 2.56 times what my company presently pays for the entire cost of health insurance per employee per year. Some may quibble with my $190 billion per year cost, but given underestimates of program costs in the past for Medicare and Medicaid, this is a very conservative cost estimate.
This is the essence of the ObamaCare plan. I will have more to say about its consequences in the future. It is guaranteed to result in higher health care costs, rationing of health care, a refusal to allow Americans to pay for additional services out-of-pocket, a loss of jobs, unhappy and less professional doctors, more unionization of the health care industry, and even more massive government deficit spending.

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