Obamacare | The Government's Takeover of Health Care
Obamacare's Affordability Glitch Introduces a Nasty Side Effect
Monday, 18 February 2013 08:05
Written by Justin Credible
The politburo behind the crafting of Obamacare had a desired outcome for the government to control the individual. This is apparent everywhere in Obamacare, as the law puts more people into state insurance exchanges. Additionally, since the public option approach would have never passed Congress, Obama's team set up Obamacare so that it would be too costly for employers, forcing them to drop coverage, leaving individuals no choice but to join the government system. And this is where the "affordability glitch" causes huge problems.
Last week we reported that the CBO estimates that seven million Americans will lose their health insurance under Obamacare. We fully expect this number to increase substantially. This increases the number of people that will be forced to join the government state exchanges.
The details from FOX News:
Advocates for the poor are now suddenly concerned about a new oxymoron, the so-called “affordability glitch,” where your employer can no longer afford to cover you and your family, and you will be forced to go to the state exchanges for your health insurance only to discover that you can’t afford the rising premiums there and don’t qualify for a federal subsidy. The only “good news” about this glitch is that new IRS regulations may exempt you from paying the 2.5% tax for non-compliance, which is hardly a consolation when you still lack insurance.
Employers simply can’t afford to pay these health insurance premiums, especially for family plans, and remain in business. And you are no longer allowed to pick up the slack. Consider that ObamaCare will allow you to pay only 9.5% of your income towards an employer plan.
So what will your employer do? It is becoming more and more likely that he or she will drop your policy and pay the penalty, or reduce you to part time hours to avoid the penalty. According to new estimates just released by the Congressional Budget Office, at least 7 million people who now receive health insurance from their employer will not be covered by their jobs a decade from now. This is double the number the CBO previously predicted.
Twenty-three million of us will go to the state exchanges, according to the CBO, leaving 30 million non-elderly people still lacking health insurance by 2023.
How ironic are these estimates when you consider that ObamaCare’s stated purpose is to provide affordable insurance for all. So why the glitch? The answer is that premiums are rising to the point of unaffordability, something that the new law should have anticipated given its taste for comprehensive plans with low co-pays and limited deductibles ($2000 for an individual, $4000 per family maximum).
Consider the state exchanges, where beginning this October ObamaCare will offer four basic types of plans; Bronze, Silver, Gold, or Platinum. Bronze is considered a basic, catastrophic-type plan, but this is simply false advertising by the Obama administration when you consider what the plan must cover; ambulatory and emergency patient services, hospitalization, maternity and newborn care, mental health and substance abuse services, prescription drugs, rehabilitation, laboratory, preventive and wellness services and chronic disease management, and pediatric services including oral and vision care.
Sounds great until you consider the cost of all these non-catastrophic services. Traditionally, high deductibles have kept premiums down by promoting cost-sharing; you pay out of pocket for basic well care and utilize a health savings accounts to provide you with a tax deduction for most or all of these payments. ObamaCare doesn’t believe in this kind of common-sense cost sharing and is trying to decrease out of pocket payments. When you take away these proven disincentives for overuse, you are left with an entitlement behemoth.
Rising premiums automatically accompany comprehensive insurance plans in an age of expensive medical technology. Insurers transfer costs to the consumer. The bronze and silver plans on the state exchanges will limit the amount you can pay for premiums to 9.5% of your income if your income is 300-400% of the poverty line, but on average, the IRS estimates that a family of 5 will be paying $20,000 for a bronze plan. This is simply unaffordable to most families.
There’s that glitch again. And here’s the main oxymoron; The unaffordable affordable act.
There are so many unknowns about Obamacare that the worst won't be realized until the law is fully implemented. And this is when reality kicks in and the devastating effects of the law will be a daily occurrence for Americans.
Justin Credible is a contributing editor for Habledash.