Obamacare

The Costs and Consequences of Obamacare

With universal coverage comes widespread costs.

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“We have to pass the bill so you can find out what’s in it,” said Nancy Pelosi during the debate over Obamacare. The Affordable Care Act passed, and Americans are now finding out. It’s not a pretty picture. 

Take employment. “Medical device makers in Massachusetts and elsewhere are warning of potential job losses,” reports The Boston Globe, because of a 2.3-percent tax on medical devices imposed by law. Even liberal-heartthrob-turned-Massachusetts-Senator Elizabeth Warren, a supporter of the law, says repealing that tax is “essential.” (To paraphrase a cliché, if it saves one job â€" hers â€" it’s worth it.)

But the ACA’s effect on jobs goes well beyond medical device makers. Reporting on January’s employment numbers, Investor’s Business Daily notes an “apparent shift to part-time work ahead of a key Obamacare deadline.” Although more people are working in the retail sector, they are working fewer hours per person â€" now just a hair above 30 hours a week. “A similar trend,” IBD notes, “showed up in leisure and hospitality.”

Why? No great mystery: Under the ACA, companies with 50 full-time employees or more must provide health insurance or pay a fine. As Paul Christiansen writes in The Wall Street Journal, “thousands of small businesses across the U.S. are desperately looking for a way to escape their own fiscal cliff” through layoffs or shifting to more part-time employees. (He advises a third route: “going protean,” an approach in which a small cadre of managers sets strategy and outsources everything else â€" from accounting and IT to product development and manufacturing â€" to contractors.)

This employment shift may frustrate one of the aims of the Affordable Care Act: increasing the percentage of Americans who have employer-based health insurance. Won’t the downsized be able to buy subsidized health insurance through the new state exchanges, though? Sure. In fact, they will be forced to, or pay a fine. But that only highlights another area where the law is falling short: cost control. Back in 2010 the Congressional Budget Office estimated the average subsidy at $3,970 per individual. It’s now up to $5,510 â€" bringing the overall cost between now and 2022 to more than $1 trillion.

This is the trajectory of a law President Obama insisted was necessary to “bend the cost curve downward.” Indeed, three years ago Health and Human Services Secretary Kathleen Sebelius explained the “urgency” of health-care reform this way: “Working families have been saddled with huge rate increase in their health insurance premiums” â€" 39 percent in California, 56 percent in Michigan, and so on.

Yet as Michael Cannon of the Cato Institute notes, a recent survey of insurance companies finds that “if the law’s insurance rules were in force [now], the premium for a relatively bare-bones policy for a 27-year-old male nonsmoker on the individual market would be nearly 190 percent higher.”

Okay, so maybe the conservative group that conducted the survey cherry-picked that case. What about other sorts of policies, and other people? The news isn’t much better: Wisconsin predicts “an average premium increase of 41 percent.” Ohio’s Department of Insurance says “the individual health insurance market premiums are estimated to increase by 55 percent to 85 percent above current market average rates.”

ACA defenders retort that consumers won’t pay the full cost of those big increases because of the subsidies. But those subsidies â€" soaring already, as noted above â€" merely shift costs; they do not lower them. The government is picking up the tab in the same sense that it picked up the tab for the war in Iraq: by handing it off to taxpayers. 

That’s precisely the story with regard to Medicaid, too: Washington is trying to bribe states to expand the Medicaid rolls by funding nearly all of the increases. From a state government’s perspective it looks like a sweet deal: free federal money! From the taxpayer’s point of view, it looks like a sick joke: Medicaid’s expansion could raise the cost of the program by $1 trillion over the next nine years. 

That’s on top of the trillion-plus cost of subsidizing insurance purchased through state exchanges. Speaking of which: Under ACA law, those exchanges will require thousands of “navigators” to help consumers select a policy. California alone expects to hire 21,000. (Virginia, which is letting the feds run its exchange, has no estimate.)

The insurance industry is supposed to foot the bill for the navigators through a surtax â€" just one of the many levies in the legislation that are now taking or soon will take effect. Others include a 0.9-percent Medicare tax increase, a 3.8-percent tax on investment income, a tax on indoor tanning, a tax on brand-name drugs . . . and of course the tax for failing to abide by the individual insurance mandate. 

Long story short: Less employment, higher rather than lower costs, higher taxes, and massive increases in government spending. The health-care law might not be working as advertised. But another law â€" the one about unintended consequnces â€" is working like a charm.

This article originally appeared in the Richmond Times-Dispatch.

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92 responses to “The Costs and Consequences of Obamacare

  1. Costs are just a right wing myth from their bubble. We need to think of sacrifices for the greater good, not costs. Costs are bad, and sacrifices are noble.

    1. It’s an investment. Does someone who bought Apple in 1980 call his investment a “cost”?

    2. Costs, or if you want to call them sacrifices, can bankrupt us. The consequences of that are definitely not noble. No one buying our bonds, high inflation, paying more money for healthcare leaving little for other things, less employment. Less hope. Going back to the third world. Poor economic conditions that eventually give rise to a Hitler like persona who promises to set things right, but is a ruthless dictator.

      Remember, the bill had not a single republican cost control measure, sweet deals for pharma companies (eg. banning re-imporation of drugs), sweet deals for unions, waivers.

  2. Hinkle, Hinkle, Hinkle…

    You’ve been reading my prediction posts from over 2 years ago, haven’t you? Not to mention RC Dean’s…

    You’re a little behind the curve there, pal. You’re correct, but, “WE TOLD YOU SO!”

    1. But RC – who could have seen this coming? WHO?

      No wai! I can haz no teh troof an Prez Bama tellin teh troof! Az Ceiling Cat iz witness – Bama bendn teh cost curv and lwrs teh cost PRAYZ CEILING CAT!

      U rite wingrz wif gunz n byblz n stuffs jes wan Bama FAYL! Not happpnin.

      So bittr kligners lissen up – Bama reeeelectd; Cost crv bendin; tyms dey r a changn; get wif progm bud d kthxbai.

      /LOL!

      1. Alm, you are waaaaaay too good at that. Anything you want to tell us?

        1. Old man river is just trying to fit in with kids these days instead of telling them to get off his lawn.

  3. Foreseeable consequences something something, how did that go again?

  4. Obama and Pelosi did not cause the problem; all the additional costs are the result of evil KORPURSHUNS requiring further regulation of the medical market.

    1. Just like with everything else the government does, problems are created to be “fixed.”

  5. But another law ? the one about unintended consequnces ? is working like a charm.

    You really need to commit to memory The Iron Law, Hinkle. Nothing was “unintended” here.

  6. Now, this is FUNNY:

    “ACA defenders retort that consumers won’t pay the full cost of those big increases because of the subsidies”

    I think they mean pixy dust.

    1. So “sonsumers” must not pay taxes.

      But I DO pay taxes. Then if I’m not a consumer, what am I?

      *eyes widen, shrinks back in horror upon realizing….*

      IT’S A COOKBOOK!

    1. If we say things enough times, they become true!

      1. Consensus equals veracity, just like with global warming climate change. So if Obamacare doesn’t work, it’s obviously the fault of the nasty people who continue to oppose it.

    2. LOL! On Ceiling Catz naym I swer – teh yungsterz gun get it GUD N HRD, OK! Dey not waykin up soooon enuf. Won dey POOF – Bama cayr workin and dey is PWND LOL! kthxbai

    3. From the link:

      “Even if the existing under-35 cohort has relatively few health care problems right now, it’s still in our interests to set up a system that will provide for future needs”

      Who’s this “our”, bozo?

      1. that’s pretty stupid, even for Yglesis. The ACA really does nothing to fix Medicare’s long term financial problems.

        “the integration of information technology into the health care sector”

        RC has hit on this, but it’s not the cost saver it’s advertised to be.

        1. That’s because it’s exposing undercharging and other “hidden costs” that are supposed to be ameliorated by this pile of shit.

          RC also said, and I disagree with him at the time, was that HIPAA, as written, already addressed much of what this law is supposed to fix, but exposed early on how flawed government intervention is, so most agencies simply didn’t follow it (except all the privacy protections) as written, and I mostly agree with him now after talking with other stateside colleagues in the know.

  7. Intentions trump costs and consequences, just as hope and change trumps outcomes. Which is why I have pretty much lost all hope.

  8. “But another law ? the one about unintended consequences ? is working like a charm.”

    I’m not convinced these consequences were entirely unintended.

    The purpose of the tax on medical devices was to discourage care providers from investing in new technology–and using that money instead to do bread and butter care, hire more nurses, put more beds in the hospital, etc. Obama wanted less innovation, and that’s what he got.

    Likewise, Obama wanted more people on government programs–and he wanted businesses and taxpayers to pay for it. Now that businesses and taxpayers are being forced to pay for all those extra people on government programs, I’m not sure we can call that an unintended consequence.

    I think what’s happening here is that a lot of people are starting to clue in to the obvious consequences. A lot of people looked at the warnings about ObamaCare, and they didn’t take them any more seriously than a horoscope. Now that the predictions are becoming reality, people may start moaning about the consequences of ObamaCare, but that doesn’t mean the consequences were unintended.

    The Obama Administration knew what it was doing all along. What we’re seeing happen is what they wanted.

    1. Yep. Can you imagine if these people had been in power in 1950? A CAT scan would be science fiction to us.

  9. I’m finished with this article just at the title. This is the biggest hack piece I’ve ever seen. Every word of the title is a lie.

    First off, the “Cost” of the Patient Protection and Affordable Care Act (PPACA), was scientifically proven by the CBO (who are non-partisan!) to not exist, as the law will lower the deficit over ten years of taxes and 6 years of benefits.

    Secondly, “and Consequences”? That word has an impression of negativity, which is silly since everyone is getting better healthcare, cheaper, and more available as a result of this historic healthcare reform.

    Third “of ObamaCare”? It’s called the Patient Protection and Affordable Care Act, and calling it ObamaCare is just straight up racist and trying to discredit the PPACA by associating it with Obama’s name, via racism.

    Finally, since when is PPACA a “The”?

    1. A trifle testy this morning?

      1. You sayin’ Auric is playing “Small Ball”?

    2. Auric Demonocles is shilling for the Obama Administration.

      He says that ObamaCare reduces the deficit, but he accidentally somehow forgets to add that ObamaCare makes us more competitive internationally?

      I don’t think so!

      How much are the Koch Brothers paying you?

      1. Was supposed to read, “Auric Demonocles is shilling for the [Big Business].”

        I need more sleep.

    3. are you drunk?

      btw feel free the rest of the story, you have a “open” mind, right?

      1. Doctor, rush this man a new sarcasm detector.

        1. Can’t. The company that made the sarcasm detector has gone out of business thanks to the medical device tax in Obamacare.

        2. Crap. was that sarcasm?

          shit. I might be to old. I don’t think Obama will give me a new one

    4. As long as it was scientifically proven to reduce costs, I don’t have any problem with it. In fact Ive never felt healthier. I think obamac.. i mean PP something or other is really working!

  10. Obamacare is an anagram of “A boar came.” Not sure what this means.

    1. Oh Pro’L Dib, a word please…

    2. It is also an anagram of “A Bra Cameo.” I think I know what that means, but I’m not positive.

    3. It has the potency of Wild Boar semen

    4. Amoeba Car
      A Bare Coma
      A Bar Cameo

  11. Jesus FUCKING Christ.

    “Unintended” – STOP IT!

    “Method to get to single-provider through the back door.” They knew exactly what they were doing. The dumbasses who supported the liegislation don’t give a shit about any of this, because they’ll warmly embrace single pay fully socialized gummint healthcare.

    Those of us who are against all this?

    ELECTIONS HAVE CONSEQUENCES. Even for those who don’t vote. Or vote third party. Or voted for Mittens.

    1. “Method to get to single-provider through the back door.”

      And all our back-doors are going to be good and sore after they are through.

      1. That’s consistent with the “good and hard” clause of the PPACA.

    2. I work with a guy that used to be an actuary at an insurance company. He says that private insurance companies are the dumbest idea anyone ever had. The only way to do it fairly is to have the government do it.

  12. Can’t impose single-payer in one swell foop. It’s too much like socialism.

    No, first the private sector insurance companies must be crushed. Once regulations cause the cost of private insurance to be unavailable, the free market can be blamed. Then single-payer will be welcomed, if not demanded, to fix the failures of the free market.

    1. That, my dear sarcasmic, is what HillDawg is for in 2016.

      This abortion of legislation has to crash and burn first.

      Just like I predicted way back when to our own commenter, John.

      1. This abortion of legislation has to crash and burn first.

        Repeal and replace!

        1. No sarc, just “replace”. The infrastructure needed will be in place by that time. They just need to the stick to swing, and it’s not quite there yet.

          But it will be, and Pinkotarians who already are on board making noises about “Single-Payer” and their own medical social issue-y hobby horses will be pulling most of you with them.-(

          1. I think ima barf….

            1. *barf* you say?-)

              “Every Person has a Medical Hobby Horse”

              Done.

              1. “Every Person has a Medical Hobby Horse”

                What does this mean?

                1. What does this mean?

                  Simple, Sparky, every person has some medical concern either inherent to them or public (or private, and the lines have blurred almost completely) policy at large, a particular health or medical issue (or a multitude of them, but every person has at least one). In short, a “hobby horse.”

                  1. Is wanting to make my own choices and not have millions of other people involved a hobby horse? Otherwise, I’m not sure I agree with you 100%.

                    1. Is wanting to make my own choices and not have millions of other people involved a hobby horse?

                      Yes, because some other entity of some kind will be involved in that choice; even if you make all decisions totally on your own, that does qualify as a hobby horse.

                    2. It’s a bizarre statement and I’m not sure I can wrap my head around it, probably because I’m not a doctor and I don’t play one on TV. I guess I’ll just disagree with you about the everyone part and say it’s more like 98-99% of people.

                    3. I guess I’ll just disagree with you about the everyone part and say it’s more like 98-99% of people.

                      If you have a pulse, you have a health or medical concern, AKA hobby horse. The only time you don’t have one is if you are dead (EOL concerns are also a medical hobby horse, as is organ transplants).

                      Take you kidney stone (thought I forgot about that?)

                      You wanted:

                      1) The PX gone.

                      2) The problem DX’d correctly.

                      3) It was DX’d you had a kidney stone and got an ESWL to get rid of it.

                      4) It wasn’t all gone, so you pulled out the rest yourself out of your urethra with a paper clip.

                      5) You also felt the doc was not the sharpest, asking you to do some stretches to DDX lower lumbar problems, and was not listening to you describe your malady.

                      All medical hobby horses, and it’s a Medical Iron Law. (There are seven).

                    4. Also, I am still amazed you didn’t give yourself a UTI with the paper clip maneuver. Point is, you wouldn’t have known about the kidney stone had you not had a medical concern about it, involving someone else to fix it. The only thing you did yourself was pull out the remaining stone, and if you had given yourself a UTI or cystitis, you would have involved someone else yet again. All hobby horses. Got it?

                    5. All hobby horses. Got it?

                      I get what you’re saying, you and I just have different ideas as to what constitutes a hobby horse.

                    6. I am still amazed you didn’t give yourself a UTI with the paper clip maneuver

                      Guess I got lucky. I had a plastic coated paper clip which I held in alcohol for a couple minutes then rinsed with hot water before I used it.

                    7. 1) The PX gone.

                      I assume this means pain.

                      3) It was DX’d you had a kidney stone and got an ESWL to get rid of it.

                      Not sure what ESWL stands for, I suspect you’re talking about the stone breaker machine.

                      4) It wasn’t all gone, so you pulled out the rest yourself out of your urethra with a paper clip.

                      Different stone. I still get them now and then, some larger than others. I don’t bother seeing a doctor anymore about them.

                      5) You also felt the doc was not the sharpest, asking you to do some stretches to DDX lower lumbar problems, and was not listening to you describe your malady.

                      The first doctor I went to was just a family practitioner. I eventually got to a urologist once it was identified as a stone.

                      I guess I have a different definition of hobby horse that you do. I think it would be nice that doctors would be proficient enough to diagnose problems, but I have the freedom to see as many doctors as I need to until I find one that I’m comfortable with.

                    8. but I have the freedom to see as many doctors as I need to until I find one that I’m comfortable with.

                      There is your Medical Hobby Horse. Done.-)

                    9. There is your Medical Hobby Horse.

                      Hobby Horse: An unreasonable request made to a person who is under no obligation to fulfill it.

                      That’s my definition. If you still say my right to see as many doctors as I like is a hobby horse … I don’t know what to say. I’ll agree that any particular doctor is technically under no obligation to fulfill my request, but I can’t imagine that it’s unreasonable to seek health care/advice from a doctor.

                    10. Hobby Horse: An unreasonable request made to a person who is under no obligation to fulfill it.

                      If it’s important to you, it’s a hobby horse. Think about it.

                      If you still say my right to see as many doctors as I like is a hobby horse

                      It is Sparky. It’s a Medical Iron Law.

                    11. If it’s important to you, it’s a hobby horse.

                      So our disagreement is in the definition. In that case I will laugh at every putz who’s dumb enough to become a doctor. I can’t see why any sane person would want to put themselves into such a position.

                    12. Understand why I hold some of the views I do now? Just wait until I roll out all seven…

                      Look at the threads: Drugs (of any kind), medical; reproductive/social issue-y stuff, medical; ObmaneyCare, medical; medical insurance, medical; “medical access”, medical; surgery, medical; PERMISSION SLIP!, medical; fixing yourself on your terms, medical; sexual behaviour, medical; medical liability and TORTs, medical; assisted suicide, medical; gender stuff (including surgery), medical.

                      “Every Person has a Medical Hobby Horse”

                      I can’t see why any sane person would want to put themselves into such a position.

                      I’m sane and so is Dr. PG. Few people are cut out for it.

                    13. I’m sane and so is Dr. PG. Few people are cut out for it.

                      You had the freedom to become anything you wanted and you chose a profession that submits you to the whims of every other person you see. That is not sane.

                      Sorry doc, but if that’s the way you see things then becoming a doctor was just plain crazy. Even if you didn’t know beforehand what you were walking into, you still have the option to change your profession.

                    14. You had the freedom to become anything you wanted and you chose a profession that submits you to the whims of every other person you see.

                      My self-ownership, Sparky.-) And I’m not a slave. With few exceptions, I don’t have to TX you.

                      And speaking of self-ownership, I leave you with this Groovy Medical Iron Law:

                      “0% Liability of You is 100% Ownership of Yourself”

                      Good night.-)

                    15. My self-ownership, Sparky.-) And I’m not a slave. With few exceptions, I don’t have to TX you.

                      Absolutely. I still think it’s a crazy decision.

                    16. Groovus Maximus| 2.11.13 @ 4:12PM |#
                      “Hobby Horse: An unreasonable request made to a person who is under no obligation to fulfill it.

                      If it’s important to you, it’s a hobby horse. Think about it.”

                      GM, any reason the term shouldn’t apply to, oh, software design?

                    17. GM, any reason the term shouldn’t apply to, oh, software design?

                      If someone designs a kickass video game, and you are unable to purchase it, will it kill you? Probably not. Are we all end users of software design? I would say most people are. EVERYONE has a medical concern of some kind. Even you, Sevo.

                      If you have burning urination, a bad ticker, a persistent cough, weird spots or blemishes, a bunion, or some other medical concern of yours that directly affects you, then you have a medical hobby horse. Medical hobby horses do not have to be political, but with the politicization of medicine and the drive to collectivize risk, this is unavoidable.

  13. Government has turned healthcare into a Rube Goldberg machine. Expanding employer-provided coverage in order to make people healthier is like speeding up a golf ball in order to peel a banana.

  14. the one about unintended consequences

    No such thing as unintended consequences. One day my crusade jihad unholy war strong preference that this bit of language be done away with will succeed.

  15. It’s called the Patient Protection and Affordable Care Act,

    Yeah, by nerds currying favor with bureaucrats.

    1. I’m sorry, the correct response is “You’re twice the “The” he ever was!”

  16. The health-care law might not be working as advertised. But another law ? the one about unintended consequnces ? is working like a charm.

    Well then, congress will just have to repeal this “Law of Unintended Consequences”. I’m pretty sure it was just inserted into an ammendment by some Rethuglican to make the Dear Leader look bad. Same goes for the “Laws of Economics” and the “Laws of Thermodynamics”. It’s all a vast right wing conspiracy to take down our Dear Leader, His Supreme Beneficsence, Saint Barack the First. /prog-tard derp

  17. ACA defenders retort that consumers won’t pay the full cost of those big increases because of the subsidies. But those subsidies ? soaring already, as noted above ? merely shift costs; they do not lower them.

    Well, I guess it’s a matter of perspective. For many of those defenders, the costs are lowered. They aren’t the ones who’ll be paying those costs.

  18. “Long story short: Less employment, higher rather than lower costs, higher taxes, and massive increases in government spending. The health-care law might not be working as advertised. But another law ? the one about unintended consequnces ? is working like a charm.”

    Welcome to Canada, friends.

    It’s a nightmare we shall share together as one continent! After all, altogether now: We’re in this together!

    /Passes coconut cream, beaded neckless and homemade granola bars.

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  20. It need time some time to talk about cost & consequences of Obamacare. There are bad consequences and there are few good consequences.
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