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Obama healthcare proposal raises some questions

By Jason Gillman on September 14, 2009 2:10 am in Columns / 3 comments

 
Obama healthcare proposal raises some questions

I was going to try and use a semi-witty, oversimplified example to analogize how ate up House Bill 3200 (America’s Affordable Health Choices Act of 2009) is, but it just wasn’t going to work.

There are way too many things wrong with this bill to address.

Yes, there has been coverage of the bill, but I think it’s imperative for people to actually know some of the things in it and why they are wrong, economically or morally. It’s just an issue of deciding where to start.

In homage of a Wall Street experiment, I’m going to throw darts in deciding the various improprieties H.B. 3200 would give us.

One of the core things to know is that if this bill becomes a law, you will get taxed for not maintaining health insurance (http://tinyurl.com/r65674). That means that despite the fact you’re a health nut looking to save money by choosing not to have coverage, Uncle Sam is going to punish you.

Yeah, really sounds like you have choice, doesn’t it?

Another thing to note about this legislation is that it would impose additional taxes upon high income individuals and couples (http://tinyurl.com/qjmhdm). Couples filing jointly making $350k-500k get hit with an additional 1 percent, $500 thousand to $1 million dish out an additional 1.5 percent, and those really successful individuals who make more than $1 million get popped with an additional 5.4 percent!

If an individual files, the income triggers are 80 percent of joint, and couples filing separately get triggered at 50% of the joint income level.

There is, of course, the fact that the industry itself will dry out a little if this thing passes.

The bill would force insurance companies to provide certain services (even if you didn’t want or need them), and do so without allowing out of pocket costs to exceed $5 thousand for an individual or $10 thousand for a family (http://tinyurl.com/pche4f).

Of course, one would assume the logical course of action on the insurance company’s part would be to raise premiums on those who constantly require care or are higher risk.

*Bzzzt* Wrong! H.B. 3200 would prevent that! (http://tinyurl.com/r8wjzf)

And, of course, if the companies still figure out how to make a decent profit (of course we can’t have that), don’t fear! Obamacare will put the kabosh on that!

The legislation would empower “the commissioner” to set an arbitrary medical loss ratio that companies can’t fall below. If they do, they have to refund premiums.

For clarification, a medical loss ratio is determined by dividing payments by premiums.

Essentially, a lower ratio is better as it helps result in increased profits. This legislation in effect limits the profits that an insurance company may get for a given client base. (http://tinyurl.com/r6nr5v)

I suppose one last thing to make notice of is the fact that most of the legislation’s changes won’t take affect until 2013 – conveniently after the next presidential election.

After all, we can’t have Obama losing the next election, because the truth will be shown once the effects of Obamacare are in play.

 

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  • Joe M.

    It’s remarkable how willfully misinformed you seem to be. I’ll address only one point– mainly because your writing is murky and imprecise on all the others. Major changes to our beauracratic system of health care will not, and should not, happen overnight. The few years between the passage of reform and its enactment will provide barely sufficient time set in place the new structures. Reforming health care is not a beer run, Mr. Gillman. You can’t simply decide to do something, then snap your fingers and have it magically appear. It takes time to lay the groundwork for major changes (see: Iraq, Afghanistan).

    If anything, it hurts Obama to pass something that won’t happen for four years. The benefits of major change will not be felt for years, during which time Congress may change hands. The four year gap provides opportunity after opportunity for the legislation to be reversed or amended. Ask yourself this in a quiet moment: Is there *any* political upside to Obama placing his entire presidency on a single issue? He is taking the risk of becoming a one-term president by tackling this issue, losing any momentum he had, alienating members of his own party. He’s not doing this for political gain. It would be stupid to start this fight when it can only hurt him, unless he’s actually committed to enacting meaningful change.

    For all the ignorant protests I hear, there is virtually no one questionaing two basic things: 1.) our health care system is badly in need of reform, and 2.) the president sincerely wants to fix it.

  • Rachel T.

    So what you’re saying, Joe M., is that the president is willing to play the martyr, sacrifice his second term, all for health care reform? That’s precious. If President Obama were truly interested in bettering this country, he would be focusing all of his efforts on the economy and the 10% unemployment rate, not a ridiculous health care reform bill that focuses on 47 million uninsured, 35 million of which are either non-citizens or are eligible for either a government or employer-sponsored program and are simply not enrolled. That leaves less than 4% of the population considered “Americans without affordable insurance options,” so let’s not throw the baby out with the bath water when we consider health care reform. Yes, it needs to be done, but not in the radical, hyper-expensive way this president is proposing. As James Carville once said, “It’s the economy, stupid.”

  • Joe M.

    Yup, it *is* the economy, stupid. Health care costs now account for 17 percent of the economy. Nearly one in five dollars. Fixing that huge portion of the economy will have tremendous long-term impact. If we’re not spending that much on perishable, one-time-only medical care, we can use the savings on durable goods, infrastructure, or, gasp, savings.

    It’s a red herring to throw out numbers you can’t prove (35 million non-citizens and others who could be buying their own insurance) and downplay reform as “something that needs to be done”. Double digit premium increases. Insurance company purges for “pre-existing” conditions. 90 percent market shares for single companies. Health care rationing by insurance companies.

    So, okay, take away the uninsured for now. Just deal with the enormous problems presented by an industry that makes money primarily by limiting the amount of care they pay for. Not provide, because that’s what doctors do. The insurance industry is nothing but a callous middle-man that literally uses formulas to determine how many of their sick clients they need to get rid of for a profitable quarter.

    I absolutely think that Obama is thinking about the country’s welfare. If he wanted to win again over anything else, he would simply sit tight, appease the union base by pushing through the card-check bill, make a few token revisions (weak regulations of the insurance and pharma companies), and play golf with big donors. He’d play it safe and try to get this stuff done in the second term. The economy is goint to be in recover in the next few months, so he could simply claim that the stimulus bill (which I actually have a host of objections to) did its work. Why put it all on the line for something that a number of his allies don’t even want? Really, why? It’s either because he wants to go home and relax in three years or because he actually wants to help solve a huge problem before it becomes a millstone around our collective neck.