This Is What a Health Insurance Death Spiral Looks Like



A handful of reports last night suggested that the Obama administration had moved to delay the health law's individual mandate—the penalty the law imposes on those who are uninsured. That's not quite right: Instead, the administration will align the 2014 penalty date, which had been February 15, with the end of Obamacare's open enrollment period, March 31.

It had been possible to buy insurance between February 15 and March 31 next year and still pay a pro-rated uninsurance penalty—something the Obama administration only found out a few weeks ago when a tax prep firm let them know.

Delaying the individual mandate might seem like an obvious response to the ongoing failure of the federal exchange system. But it's a rather drastic step. And, in isolation, a potentially problematic one.

That's because the premiums that health insurers calculated for the exchanges this year were determined based on the assumption that the penalty for remaining uninsured would be in effect, and would encourage people to buy into the market.

If you change the enrollment requirements—by, for example, ditching the mandate—while leaving the law's preexisting condition rules in place, health plan participation will likely be lower. The result, as one insurance official told NPR yesterday, is that insurers will want to change their premiums. And in this case, "change" means "raise."

That's where the real trouble starts. Insurers raising prices as a result of lower than anticipated enrollment is an early step toward an insurance death spiral, in which premiums spike and enrollment figures drop until the only participants who remain in the market are very people paying very high premiums. We know because we've seen it before—in New York, Washington, and handful of other states that enacted preexisting condition regulations similar to Obamacare's but without an individual mandate.

New York state's guaranteed issue and community rating rules—the two regulations that limit how insurers can charge based on health history and require them to sell policies to all comers—took effect in 1994. At the time, there were about 752,000 policyholders in the state's individual market, or about 4.7 percent of the non-Medicare population. But by 2009, according to a Manhattan Institute report by Stephen Parente and Tarren Bragdon, the state's individual market had practically disappeared, leaving just 34,000 participants, or about 0.2 percent of the non-elderly population. Individual insurance premiums, meanwhile, were among the highest in the nation—about $388 on average in 2007, compared with just $151 in California, another big Democratic-leaning state. In New York City, the annualized premium cost for individuals was more than $9,300 and more than $26,400 for a family.

The result, in other words, was a combination of sky-high premiums and far fewer insured individuals. 

Around the same time that New York was overhauling its insurance market, Washington state was implementing a similar set of health plan rules. Insurers faced new regulations regarding plans sold to individuals with preexisting conditions, and the requirement that they sell to everyone. For a brief period, there was a coverage mandate, but that never went into effect. The state's individual market deteriorated. One insurer raised premiums by 78 percent in a three year period. As premiums rose, relatively healthier people left the market, and insurers were left covering a lot of very sick, very expensive individuals. In the end, many insurers simply dropped out of the market rather than lose money. According to a report on the reforms commissioned by the insurance industry, there were 19 carriers in the individual market in 1993. By 1999, there were just two—and they weren't taking new applicants.

The individual market was effectively killed off by the reforms.

A delay of just the individual mandate would likely put the federal exchange system—which facilitates the sale of guaranteed issue, community-rated plans—on the same track.

(The administration, it should be noted, has made it quite clear that it thinks the mandate is absolutely essential to the larger insurance scheme, arguing repeatedly in court that the law cannot function without it.)


Now, it's true, as The Incidental Economist's Adrianna McIntrye points out, that there are risk adjustment mechanisms built into the law designed to protect insurers who end up with too many sick individuals. But as a Health Affairs brief on the law's risk adjustment provisions makes clear, those provisions are designed to make sure that no one plan gets stuck with too many sick individuals. Plans with fewer sick people pay into a fund that creates a backstop for plans with a greater than expected share of sick policyholders.  That helps mitigate individual plan risk. But it doesn't really solve the problem if the entire pool, across most all of the insurance plans, is smaller and sicker than expected. A death spiral that shifts some premium income around is still a death spiral.

The larger worry is that we may be on track for an insurance market meltdown no matter what happens with the individual mandate. If too few young and healthy people sign up for insurance through the exchanges, for whatever reason, insurers will have to adjust their prices eventually. The access problems in the exchanges exacerbate this risk by making it more frustrating to buy policies; as a result, only the most motivated people—which is to say, the sickest and most desirous of coverage—will end up buying coverage. The same goes for the high individual market premiums that many young adults will be faced with. A mandate delay would make the risk even higher. But it may be the case that Obamacare is heading toward a death spiral no matter what, and that if it remains in place, no plausible policy response will avoid it.

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  1. Defective by Design. Single-payer here we come.


    1. I don’t think anyone in the government is carrying out 3d Health Care Chess. They just don’t understand that the ability to make laws does not allow them to force the market to do whatever they want it to.

      1. They just don’t understand that the ability to make laws does not allow them to force the market to do whatever they want it to

        Exactly right.

        1. Wrong. You can make the market do anything as long as you put a lot of smart, Ivy-League-educated progessives in charge of it. It’s the whole foundation of the Left’s utopian vision.

          1. The problem is that even if you bring in all these TOP MEN to do the job, and even if it were possible for them to design an equilibrium to be imposed via central planning that matches a market result, it would never be implemented successfully because it needs to be fed through the legislative process first. So sanctions will be reduced, more free stuff will be added, and the result is a cluster-love of mismatched policies.

          2. ”The free market is not a creed or an ideology that political conservatives, libertarians, and Ayn Rand acolytes want Americans to take on faith. The free market is simply a measurement. The free market tells us what people are willing to pay for a given thing at a given moment. That’s all the free market does. The free market is a bathroom scale. We may not like what we see when we step on the bathroom scale, but we can’t pass a law making ourselves weigh 165. Liberals and leftists think we can.” ?P. J. O’Rourke

            1. The drug war is, I think, a perfect example of statist opposition to free exchange and their utterly ineffectual attempts to quash it. It’s bipartisan, half a century in progress, utopian, generally unpopular, spun off countless unhealthy consequences, is obviously and undeniably destructive, and above all an inexcusable failure.

            2. All you glibertarians, praying to your god of the bathroom scale.

            3. That is it in a nutshell.

      2. They just don’t understand that the ability to make laws does not allow them to force the market to do whatever they want it to.

        Of course, it does. And when the unintended consequences emerge, they will just write more laws. That’s exactly how we got to the point we are at now.

      3. Isn’t the issue that the outcome could be the same either way? Even though the picture of Obama and Pelosi coming out and issuing commands to the software is hilarious, the software not working will probably conclude in demands for single payer.

        1. It already is. That’s all they’re saying at Daily Kos and the NY Times comments section.

        2. And so what? Nowhere near a majority wants singles payer. If they couldn’t get it through when they had the house, senate, and the executive, why would they ever be able to get it through when their half measures, which they voted for every step of the way, are such a dismal failure. No way single payer goes through in this generation. And in the next, single payer, along with other parts of the social welfare state, will have bankrupted much of Europe. The minute Obamacare passed, that was the death of socialized medicine in this country.

      4. But, it’s a distinction without consequence, isn’t it. I have no doubt you’re right that there was no evil mastermind plotting to destroy the health insurance market and push single-payer. But, when the consequence of their policies comes to pass, are they going to have a Saul-on-the-road-to-Damascus moment? Or is it an order of magnitude more likely that they’ll claim that this proves the need for the “public option” that will fill a critical need?

        It’s strange. I agree with you that statist policies tend to be simply ad hoc and ill considered. But, the process winds up playing out as if it were a deliberate and diabolical plan.

      5. So they’re blundering into single-payer rather than cleverly arranging to make it necessary? That’s not a whole lot more reassuring.

        1. “We think this is gonna work, but it’s good either way. We’ll just do single payer if it fails!”

        2. I’m sympathetic to some arguments for single payer. The main disadvantage is it being run by the government. It would end up loaded with more benefits to essentially buy off the votes of those benefiting. Some would say this is an acceptable price to pay. I don’t. It would eventually run into the same financial problems as SS and Medicaid will.

    2. Obamacare is only broken because of the Republican obstructionists and market failures! We can say for sure that the law is thousands of pages of perfection because the intentions are good. /derp

      1. There is always going to be stupid people. Just show them they are stupid so the less stupid don’t follow.

        1. Charlotte, when has that EVER worked?

          The first group won’t understand that they’re stupid and the second tier of stupid people won’t believe you OR anyone else that the proof was valid.


  2. Does Obamacare cover burn injuries incurred by public employees from their pants bursting into flames?


    1. What about coffee burns when one reflexively dumps hot coffee on ones self after viewing yet again a picture of THAT WOMAN?

      1. I heard she smiled once, back in 1892, but unfortunately there were no cameras quick enough to capture the moment.

        1. She’s just upset because she hasn’t made out with Obama since the rollout.

      2. Alt alt text: “At least I made sure that the new insurance mandates now cover Grecian Formula For Women.”

      3. I’m thinking I might change my Halloween costume form “slutty Hillary Clinton” to “slutty Kiki Sebelius”.

        1. And what, pray tell, does a “slutty Hillary Clinton” costume consist of?

          1. Hillary Clinton face mask with a Monica Lewinsky wig.

          2. And make sure that Randy Bill Clinton is at least 1,000 miles away.

            1. I’ll never be able to unsee that. Thanks.

    2. Personally, I am more concerned about the ocular injuries that are certain to result from all of the finger-pointing. Not including safety goggle coverage in BarryCare was a grievous oversight.

  3. One insurer raised premiums by 78 percent in a three year period.

    ACA raised my premiums by over 80% in a single year and that is WITH in the mandate.

    Im failing to see how not having the mandate could be worse based on the evidence presented here.

    1. I don’t think he’s saying it would be better or worse with a mandate. He’s saying that the whole law is built upon a series of faulty assumptions, with the efficacy of the mandate-preexisting condition clause being chief among them.

  4. This is such an incredible joke. As is this government. We need to repeal and replace. This government, I mean.


      1. I just meant the current officeholders, but I’m good with a total restructuring, if available.

        1. I suggest a combination of term limits and sunset provisions. All laws must be re-upped by a different set of politician slime on a regular basis. I also suggest a monarchy with me in the big chair and which dies when I do.

            1. You do seem equipped for the job. Your credentials are substantial, and your references more than adequate for the position. Now let’s discuss your compensation.

        2. It’s Hillary in 2016. You think she’s going to clear out the current Democratic infrastructure in DC when she takes over?

          1. Bet she doesn’t even win the nomination.

            1. I bet not either. When the full force of this hits, some Dem somewhere will go full on populist. That Dem, whoever it is, won’t be Hillary. I bet the Dems suddenly rediscover their love of the middle class and their hatred of the rich after this. I am thinking that the gentry liberals who basically sold Obama to the country and are going to try to sell the Dems Hillary are going to be the real losers in all of this.

              1. Republicans tend to nominate the next in line (aka *barf* Santorum). Democrats tend to nominate a blind date like Obama.

                Based on history, Clinton is not the best bet to win the nomination.

                1. Few outside of the DailyKos crowd think Santorum is “next in line.” I keep telling people: Scott Walker/Rand Paul in 2016.

            2. Hillary is DOA in 2016. The left is stagnant and stale, but that doesn’t mean the leftoid propaganda matrix won’t try to create another Barry for the sheep.

              1. That’s what I think, too. Always fighting the last war.

          2. The Republicans, after a two-year search, put up the worst candidate they could find in 2012, and they still got 48% of the vote. If they find anyone for 2016 with the slightest bit of charisma, it will be a Team Red landslide.

            1. I have it on the intuition of my former lefty, former Hillary-following friend that she will lose miserably to Chris Christie.

            2. The Republicans, after a two-year search, put up the worst candidate they could find in 2012

              Perhaps you have a short memory of who else was running for the Republican nomination. Romney was arguably the third or fourth best choice (after Paul and, briefly, Gary Johnson).

              Not an endorsement of Romney, BTW, more like damning with faint praise.

            3. I thought None of the Above had a lot more charisma, and I definitely supported their platform.


      3. Can’t believe you forgot “anarchist”.

    2. I’d prefer to just kick everyone out, then randomly choose their replacement. You can do this every year. No more primaries are elections. (Of course, who would control the selection process?)

      1. ‘or’, not ‘are’

  5. I eagerly anticipate reforms in the home insurance industry which require all insurers to sell policies, with no discrimination in price, to people whose homes are on fire.

    1. I want to sign up for car insurance right after I crash.

      1. I was online signing up for car insurance WHEN I crashed. Am I still covered?

        1. Only if you’re the widow of Frank Lautenberg or were driving a Chevy Volt.

          1. Oh, good. I crashed my Volt into the hearse carrying Frank Lautenberg so my claim should sail right through.

      2. I want to INVENT some kind of insurance and immediately qualify for a big payout. How about computer owner’s insurance? If you’re on Windows 8 it’s a catastrophe.

  6. something the Obama administration only found out a few weeks ago when a tax prep firm let them know.

    These are important people with a lot of important stuff to do. They’re very very busy, cut them some slack.

  7. Well Obama’s the great uniter who listens and understands all. I’m sure he’ll take stock of the situation, assess it and agree that there is no way this things can succeed. Only pain and suffering can follow.

    Christ, what has he accomplished? Everything, across the board, is worse. It stuns me to talk to the morons who still give him glowing reviews. The only thing they can bring up that I agree with is that Romney was a hopeless lump of shit.

    1. Christ, what has he accomplished?

      What about his Nobel Peace Prize that he has followed with his drone campaign?

    2. I’m glad Romney lost, otherwise we would have some “reaching across the aisle” compromises that would have left us even worse off. At least now Obama won’t get anything done anymore.

  8. If you change the enrollment requirements?by, for example, ditching the mandate?while leaving the law’s preexisting condition rules in place, health plan participation will likely be lower.

    The entire purpose of government is to change the rules mid-stream, thus intentionally screwing some people and intentionally assisting others.

    Usually it’s the fractionally-reserved financial pyrami-, I mean businesses (banks and insurance companies, ) that get the assistance.

  9. Single payer is a good idea. Doctors should expect payment from only one entity: patients.

    1. But some people might want to hedge against the risk of enormous bills, so they might want to buy “insurance” policies.

      1. I’m hedging against the risk of enormous bills by saving for a rainy day.

        1. Get a medical savings account. And insurance would work if the market were freed. The reason 3rd party payer is broken is because the incentive to mitigate costs is obliterated by the AMA-Medicare price fixing committee and the system of insurance cartels imposed on the market.

          1. “Medical Savings account” sounds a lot like “saving for a rainy day”.

            I understand people want to pool their money on the off chance THEY might be one of the 1 or 2% that needs more money for medical work than they could possibly earn in a lifetime. And that worked great back when insurance companies were mutual societies because every customer was a shareholder and got a portion of the society’s profits. And all that was flushed down the shitter of progressivism when Nixon killed the gold standard and FedGov wanted access to a lot more of that insurance company money.

            Medical concierge services are trying to get back to that model, but progressives will try to kill it, just like they kill every economically sensible idea. Because we have to keep anti-social assholes alive at all costs.

            1. They won’t kill it because half of them will be on it.

            2. No not really. There are plenty mutual companies still in existence. It’s one of the 2 or 3 more common ways to organize an insurance company.

              The problem is that insurers are cut out of the equation when it comes to cost mitigation. A fair price is one that is mutually agreed upon, but in the present healthcare system costs are dictated by Medicaid who “take advice” from a committee of technocrats in the American Medical Association. Google the “Relative Value Scale Update Committee”. They fix prices and Medicare/Medicaid pass on those price recommendations to insurers who must either comply or run the risk of being found out-of-compliance with Medicare/Medicaid.

        2. I think a combination of HSA for routine checkups, shots, and whatnot and then catastrophic insurance for like if you get cancer or have a heart attack or something would be the perfect combination.

          Too bad Obamacare killed both of those things.

          1. HSAs still exist, they have just been weakened.

            1. Thanks, I’d hate to go off half-cocked on one of my liberal friends to have that thrown back in my face.

        3. How much are you saving for your kid’s $250K cancer treatment?

          Saving is not a replacement for insurance against catastrophic events.

      2. The insurance company can send you a check after you pay the doctor.

        1. Or before, whatever.

          When my house was damaged by a tree falling on it, the insurance company didnt pay the repairs directly, then sent me a check and I paid the repairmen.

          1. My truck rolled backwards into a neighbor’s fence. My totally awesome neighbor went out and repaired it himself. When the insurance company contacted him, he gave them the bill for $25 (I think it was actually like 23.75 or so) for the materials. The insurance company finally gave up on trying to get him to take more, called me and asked me to give him the $25 so they could just forget about the paperwork. All’s well…

  10. The larger worry is that we may be on track for an insurance market meltdown no matter what happens with the individual mandate.


    We should be CELEBRATING the blessed event!

    1. I know that’s what’s letting me get a bit of sleep at night. This isn’t failing quickly enough for me.

  11. Cut them some slack, Rome wasn’t burned in a day you know?

    1. Neither was Detroit, though valiant attempts were made.

  12. They’ll just up the subsidies to bribe people into signing up. Or they’ll toss some money to insurers to cover their losses.

    Remember, folks, we are the only ones concerned with the budget. No one else gives a darn.

    1. They would have to get the website up and running to do that. You can only get the subsidies if you sign up. Tossing insurance companies money could work. But to do that you would also have to limit their prices. Not sure how you would do that since it is the states who control that. Also, we are talking big money here. Almost TARP money. How exactly do you get that through the House? The House can come back and say “just repeal the damned law and save the money”. Yeah, I know America is retarded and will believe anything no matter how stupid and will be demanding full communism in a few months. But work with me here. Before America demands full communism after the failure of Obamacare, what are they going to do?

      1. Yes, but when the time comes to toss around those huge sums, the public, media and Congress will be in panic mode similar to the financial crisis. They’ll all be demanding it, as it will be less odious then bailing out bankers.

        1. That is the flaw with the “this will really result in single payer” theory. To get single payer you have to let the insurance companies go bankrupt. That would be a financial crisis close to if not as big as 2008. So yeah, they would bailout the insurance companies. But that doesn’t end the death spiral or make them profitable in the long term. And you can’t bail them out forever. Even the Fed can’t print that much money.

          So you are left with the options of letting them go down and having another deep recession/depression as a result but maybe getting the beloved single payer, or gutting the law. Those are the only two options. Maybe they do go for single payer. But a lot of very important people are going to go broke if they do.

          1. Hopefully a lot of “important” people’s heads will roll for it.

            Figuratively of course (fuck you NSA).

          2. Unions vs Insurance execs. Epic.

          3. You are making the big assumption that the people who didn’t notice the coverage penalty hole will figure this out. Remember how stunned they seemed to be when they figured out there would be consequences to dismantling big banks? What if they could have done that unilaterally with the public cheering them on? Who would have taken the blame for the collapse? Them rascally republicans and Bush…

      2. Tossing insurance companies money could work. But to do that you would also have to limit their prices.

        Why are you trying to handcuff our public servants?

    2. The government can always borrow Sad Beard’s platinum coin. It’s worth a trillion dollars, so that should be good for several week’s worth of spending.

  13. At this point can anyone please give me any reason to not expect a death spiral? I can’t see one. There is a limit to everything. At some point you will hit an equilibrium where people have enough money and enough risk aversion where they will pay the obscenely high rates required to support the system. Where that point is is anyone’s guess. But I would think it would be near six figures. If nothing is done, I don’t see how this isn’t going to result in either a sizable minority or more probably a majority of the country losing their health insurance as they and their employers no longer have the money to pay. Remember, if you have a job and any kind of income, you are not getting subsidies. The political fallout from that is going to be epic.

    1. The political fallout from that is going to be epic.

      Don’t count on it. Change rests on the independents. What will they do?

      1. I await their declaration.

    2. Thanks John. Because this is exactly what I was thinking.

      You have young adults (up to 26) who are not paying for insurance because either their parents are paying, they’re clueless and don’t know they are required to purchase, or they will gladly pay the small fine instead. And I am guessing you not going to get the participation needed to support the system form the 26 and above crowd. And since these are the people that are subsidizing the fucking vampire elderly baby boomers, I don’t see how the system can do anything other than fail.

      1. Count me among the twentysomethings with no intention to purchase insurance, whatever the subsidy. Unless I find a policy amounting to $15/month, I’ll grudgingly fork over the $177 penaltax in April.

  14. As enjoyable as this train wreck has been, I’m sure the damage will be minimal to the Dems. Those who pay attention care, but your average herr-de-derr low-info voter doesn’t understand markets or what’s really happening behind the scenes. They just want their piece of the freebie pie, as long as the evil insurance companies or rich people get shafted, it won’t matter. Those rising prices – if it effects them – won’t be the fault of the wonderful politicians who want to help people – no, it’s always the fault of someone else.

    Okay, H&R is making me a cynical bastard.

    1. I was cynical before I came here. This place just helps me realize that it might not be me who is insane.

      1. Just because you are cynical doesn’t mean that the world isn’t a cold and meaingless place full of stupid people.

      2. No matter how cynical you are, it’s hard to keep up.

        1. Great quote from joe Jackson (the songwriter, not the other one) on cynicism:

          “I’ve always thought that cynicism is a disease of the young, contrary to what other people seem to think. I think when you’re young, it seems clever to be cynical, but once you get to about 40 or something, you start to realize that actually, things are even worse than you ever expected, so if you’re going to make it through this life, you actually have to be more positive. I don’t mean sappy, I just mean positive. Just not give up. Cynicism is giving up. Cynicism is close to pessimism; it doesn’t get you anywhere.”

          1. That is a great quote. On the recommendation of a friend I saw Joe Jackson in concert a few years ago. He is a fantastic musician and performer. I vaguely remembered a couple of his hits from the 1980s and nothing else. I was stunned at how good of a show he put on.

          2. I went through that realization and attitude transformation a couple years back. I call it the “fuck it” shift and highly recommend it.

            1. Usually, I cringe when confronted with a musician I enjoy talking about politics. “When will the Government get serious about solving all of mankind’s problems!”. But then, here is Joe:

              “I’ve gotten a lot of criticism for speaking out on some of these things, like the smoking bans, which I detest. I think they’re wrong on so many levels. I don’t know, it feels like I’m banging my head against a wall a lot of the time. I think a lot of people have bought into the idea, which I think is a false one, that anything done in the name of health must be okay. You can’t really criticize it. All that does is make people who speak or act in the name of health bigger and bigger tyrants. They just get away with more and more lies and more and more bullying. I think that’s really what’s happening. I think more and more people are starting to realize it, but I think a lot people are scared to challenge or question what is fed to them on the basis of health or safety. In a way, it’s the last refuge of scumbag politicians, because they know they can’t do it on the basis of religion or morality so easily anymore, at least. They can’t do it on the basis of political ideology. I think people have lost their faith in a lot of those things. So what’s left? What’s left is scaring the pants off us. Fear for our health, and our children’s health. I think a lot of it is really bogus.”

              1. same goes for Global Warming.

                With the collapse of the Soviet Union and it’s satellite governments in the eastern bloc, it became very hard to convince people to support nationalization of industry in order to create a more just society. Today they argue they must do it to prevent the destruction of the planet. Who could be against saving children from a fiery death?

    2. It didn’t seem to help the Dems in Congress in 2010. And it didn’t even get them back the House in 2012, despite getting the black Jesus re-elected. Maybe the Dems should have rolled out this disaster in 2011. People would have blamed the insurance companies and Republicans and given them back Congress. That is what you think is going to happen now right? So then too right? The Democrats sure seem upset about this for it being such long term good news.

      1. At this point I don’t know what’s going to happen. The “ZOMG-SHUTDOWN all Republican’s fault” certainly didn’t help my belief that America will wise up.

        1. Three things to remember about the shutdown.

          1. The media lies so much that most people have no idea how extreme the current crop of dems are and think Obama is a centrist.

          2. People have an engrained belief that the two sides in Washington should just get along and get things done, even though they really have no idea what that should be.

          3. Obamacare wasn’t rolled out until October 1. So even though people don’t like it, most people had no idea how bad it actually is.

          When you understand that, it is no wonder people thought the Republicans were wrong to shutdown the government over Obamacare. But, as people lose their health insurance or see their rates go up or get taxed for health insurance they can’t buy, convincing them Obamacare is a great thing is going to take a lie an order of magnitude above any of those three lies. Maybe they can do it. But if they can do that, I don’t see how there is much they can’t do.

          1. The media lies so much that most people have no idea how extreme the current crop of dems are and think Obama is a centrist.

            When you call for your opponent to be arrested for sedition just because they don’t want their great great grandchildren to pay so you don’t have to endure any discomfort, that is pretty fucking extreme.

    3. The problem is, this isn’t abstract. It hits individuals. Remember those pro-ACA morons in California who were shocked when their premiums and deductibles skyrocketed? “It was, uh, my understanding that, uh, _other_ people would be paying for this.”

  15. oh, and nice Almanian GILF pron shot there. *queues wacka-chicka-wah music*

  16. Pete, I love you, man, but can you please wield your massive influence and cease having pictures of THAT WOMAN attached to your articles? She puts me off my coffee. thx.

  17. Thus begins the blame assignment:

    “I think it’s a problem, I think the fundamental mistake that was made ? well, first of all, in fairness you gotta blame the Republicans for some of this because they delayed everything they possibly could, threw as many monkey wrenches into the process as they could, and there’s some success here,” (Howard) Dean said.

    1. Fuck you Howard “WoooHaa” Dean. The Dems own this lock, stock, and fucking barrel. For fuck’s sake, Cruz’s whole filibuster rant thing was about trying to delay this monstrosity and you all just picked up and ran with it anyways.

    2. Yeah, it was totally the Republicans who set this thing to go into effect in 2014. And putting it into effect earlier would have made all of the difference in the world. I mean, if HHS had just had LESS time to get the website up and working, they would have done a better job. Right?

    3. “in all fairness”? I do not think that means what he think that means.

  18. your average herr-de-derr low-info voter doesn’t understand markets or what’s really happening behind the scenes.

    When your average herr-de-derr Ameericano hears “Obamacare” it translates as, “Free Unlimited Health Care For LIFE”.

  19. At this point, why not just go full NHS and get it over with? Humorously enough, per capita healthcare spending by the U.K. government is significantly less than per capita healthcare spending by the U.S. government (U.K. government health spending is about 75% of U.S. government health spending).

    1. All numbers are per capita, even if I didn’t say that explicitly.

    2. Because maybe a few of us bitter clingers would like to cling to decent health care for as long as we can?

      I mean hell, at this point why not just start marching people off to the camps? It is going to happen eventually anyway.

      1. Well, you’ll still be able to get decent health care, you’ll just have to go to a private clinic. The poor and middle-class can camp out with the rats, NHS-style.

        1. Or go to another country. Yes, the rich will always be rich. But it will be more than the middle class who are screwed by single payer. It will be everyone but the very rich.

          1. Well, I didn’t say that my idea was economically desirable. It’s just going to be damn near impossible to stop the Free Shit Express, so you could try to divert it instead.

          2. Or the very poor, or just low income actually.

            One of the early success stories trotted out by the Dems was memed as a staunch Republican” who was paying $1050 for he and his wife. After signing up for Ocare he paid ZERO and had little or no deductible. The article went on to say that he and his wife had their house and two cars paid for but they had very low income. He was a rancher/farmer in Wyoming or somewhere in that region. The article didn’t mention if he owned his land or not.

            So, Ocare is designed such that people with assets and a paid for home can have their insurance paid for by people with ZERO assets but have a job and wish they could buy their own home.

        2. It is my understanding that private clinics are illegal in the U.K – thats why the wealthy come here for care.

          1. Nope.

            Thousands of patients are ditching the NHS in favour of a private clinic, run by Polish doctors.

            My Medyk, which has two centres in the capital [London], has around 30,000 patients on its books and around 6,000 of these are estimated to be Britons. It is open longer than most GP practices, offering more flexible appointment times as each practice opens from 9am to 11pm, seven days a week.

            And despite the ?70 fee for a consultation, Mr Przypis said the number of patients is constantly on the rise.

          2. You are confusing the UK and Canada.

            1. Private clinics are also allowed in Canada, with restrictions (of course):

              Restrictions on privately funded health care.

            2. Canada used to outlaw private practices, but some determined doctor fought it all the way up through the courts and got that rule thrown out

              I was in Canada recently, and they do have doc in the box private practices.

          3. They have urgent care type places, and you should use them if you have anything short of a bone sticking out.

    3. At this point, why not just go full NHS and get it over with?

      To go ‘full NHS’ in the USA, to reach similar costs in the medical industry, will require USA to also make medical malpractice similar to the UK.

      For every two doctors in the USA there is a malpractice shark to feed, and malpractice sharks have expensive tastes in cars, houses, and the like. And they are ultimately paid as a cost on everyone’s healthcare bill – or taxes with BarryCares.

      But the trial sharks are Clowncrats, so in Clowncrat paradise the world is single-payer with caps on all prices bar but what the shark gets in settlements.

      Sounds like a great system. Yikes.

    4. There are two sides to a transaction: getting a quality product or service at a reasonable price. The NHS may be spending 75% of what is spent in the US, but could also be delivering only 25% of the product. Would that be a good deal?

    5. This is a common misconception.

      1. These governments price fix, and much of the actual costs are carried over to us Americans.

      2. They do not have the FDA increasing the costs of everything exponentially. Sure they have something similar, but it is no where near as draconian as the FDA.

  20. Somewhat related: Conservative colleges “suing the federal government over a provision of the Affordable Care Act that requires employers with health insurance plans to provide birth control, according to a letter from university President Joseph Stowell.”


    1. “This filing is first and foremost an effort to preserve and protect our religious freedom as guaranteed by the First Amendment,” he wrote. “Given our conviction that life begins at conception and our commitment to the sanctity of life, we find the mandate to provide our faculty, staff and students with insurance that provides access to abortion-inducing prescriptions unacceptable.”

  21. None of this is a real issue. The President has brought in “Top Men” to fix his website. All of us will happily be enjoying Obamacare here in the next couple days !!!

    Where is my scotch ? *sigh*

  22. A death spiral that shifts some premium income around is still a death spiral.

    That concept right there indicates how little the DC gang understands insurance.

    Most insurance providers do not make money off premiums – the actuarial assumption is every premium going in eventually goes out. The idea is to make money off the premium ‘deposit’ until said premium is paid out. In the biz, that is called the ‘float.’ An insurance company that is making money off of premium income alone, in addition to investments, is an operation getting paid by folks to more-or-less sit on their money. They are quite rare.

    If premiums are being shifted around on the backend however, they are not in the low-risk/low-yield investments insurance companies like to stash their cash. Why anybody calls the scheme ‘insurance’ at this point is bizarre. The ‘insurance companies’ are just shelf corporations to hustle money towards political markets in Barrycares – with all the chances of actuarial success that implies.

    1. Yes. And gee fifteen years now of the Fed artificially suppressing interest rates and thus the rate of return on safe investments might have raised insurance premiums a bit, you think?

      1. I cannot be sure, but there is an angle there worth looking at.

        On a side note, the favorite Clowncrat retirement scheme – pensions – depend on stable, liquid assets a’la Treasuries. I am sure they have been getting hammered actuarially with suppressed returns.

        1. It is funny how they screw one another. If Greenspan hadn’t suppressed interest rates, the public employee pension funds would not be in near as bad of shape. But of course had he not done that, Obama could have never borrowed all that money.

    2. “Most insurance providers do not make money off premiums – the actuarial assumption is every premium going in eventually goes out. The idea is to make money off the premium ‘deposit’ until said premium is paid out. In “”

      OMG!! Someone who understands the evil mechanizations of the corporashuns and the investments and the insurances and time value of money and insurance cost versus hc spending and 1%!!1%!!! kill it with fire!


      This is, sadly, the absolute worst way to try to get through anyone’s head because almost *no one* understands what the hell the money being paid monthly is *for*. You start to explain it to them and they glaze over and start seeing cartoon Billionaires like Mr Burns sitting on bags of their Premiums, and wondering “but that’s my healthcares!”

      Even when the idiots start saying things like, “But if we get rid of all the insurance company’s profits then…”

      and then you explain to them that the *entire health insurance industry makes less than $15bn in profit annually*, while Medicare – by contrast – *loses* $50billion or more…

      and it still does nothing. Nope. Seriously, this is why people need really simplistic political piniatas to hammer at, because anything less simple dissolves on contact with their 1-dimensional universe.

      1. People don’t understand that buying an extended warranty on a car is buying insurance. How do you expect them to understand how insurance companies function if they don’t even understand what insurance is?

    3. the actuarial assumption is every premium going in eventually goes out.

      The actuarial assumption also assumes people have the same personal responsibility impulse as 150 years ago. Sadly, progressivism always and everywhere ruins the notion of personal responsibility and the failure/accident rate of 2% needs to be adjusted up to something like 33% to fit in with the moral hazards that statists have wrought.

    4. This is incorrect. There is not alot of investment income on health insurance premiums due to the short-term nature of the liabilities.

      Additionally, health insurers build op gain (profit) into their rates. Basically your health insurance premiums are made up of projected claims, admin expenses, selling expenses, premium taxes, ACA fees, and an explicit load for expected profit. Additionally, health insurers also build profit into their rating factors. For example, projected claims are based on experience claims that are completed (adjusted for claims run-out) and trended forward from the experience period to the rating period. The factors developed to complete and trend the claims are based on raw estimates of what those factors should be plus a margin. If the raw factors are correct, then the margin becomes profit.

  23. That’s because the premiums that health insurers calculated for the exchanges this year were determined based on the assumption that the penalty for remaining uninsured would be in effect, and would encourage people to buy into the market.

    I keep hearing about this but I don’t get it. Isn’t the penalty $90 a year or 1% of your income – at least in the first year? For most people that’s going to be negligible compared to the increase in costs for insurance. I don’t see how this mandate is going to have any kind of large effect unless/until it becomes much more punitive.

    1. I agree. I was about to say that I find this passage from the article very difficult to believe. If anything, I think they’ve raised premiums under the assumption that healthy people aren’t going to be coerced into this market by taxes. At least, not at first. It’s going to be sick people.

    2. they won’t make money on the up to 26 year olds on their parents policy.

      but they also won’t make any money on young to middle aged women who will all be demanding the expensive $200 a month birth control pills. a lot of women want them for reasons other than bc.

      btw, are they required to supply birth control to men?

      1. Of course men don’t get supplied birth control. Check your privilege.

        1. Condoms are still allowed to be purchased with HSA money. That and contact solution are about the only OTC things left.

          1. Anarchy! This will soon be remedied.

      2. Yes, thy are, but the loophole is that they send you a picture of Secretary Sebelius in a bikini, and trust that it will prevent anything from coming up, so to speak.

    3. I keep hearing about this but I don’t get it. Isn’t the penalty $90 a year or 1% of your income – at least in the first year? For most people that’s going to be negligible compared to the increase in costs for insurance.

      This system isn’t designed to ‘work’ from perspective of stable finance. It is designed to ‘work’ over a programmed set of time, to build a political constituency of dependents who will vote their ‘entitlement.’ Way to do that is gimme-dat for the first couple years, then scramble to pay the bills when they come due.

      The actuarial cleverness with Social Security and Mediscare was making the system age-based, it has literally taken a couple generations for those fiscal chickens to come home and roost. BarryCares depends is neutral on age, so the time horizon is only a few years before obvious insolvency, so they need to get peeps signed up stat.

  24. If too few young and healthy people sign up for insurance through the exchanges, for whatever reason, insurers will have to adjust their prices eventually.

    Unless they get a bailout.

    1. You can’t bail them out forever. A bailout doesn’t make them profitable or change the underlying economic reality. They could bail them out once. But that would only delay the inevitable.

      1. Or they could nationalize the insurers.
        That’s what happened in California when the state fucked up the energy market and drove the utilities into bankruptcy.

        1. I am not sure they could nationalize the insurers. That would be a very legally tricky thing to do legally. Yeah, I know you can always find a craven judge Roberts to ignore the Constitution, but that doesn’t make even coming up with a fig leaf for such a Justice easy.

          Beyond that, it would be incredibly expensive. Those companies have hundreds of billions in assets. You couldn’t just confiscate all of that without leaving their investors broke which probably torpedo the entire world financial system. So you would have to come up with something approaching a trillion dollars to do it. Again, a real tough sell.

          But say you do nationalize them. To make them profitable or even break even, you are going to have to massively ration care. And that is before you even think about cutting rates, which is allegedly the reason you asked the tax payers for all that money to nationalize them.

          So that leaves you going back to the voters saying “yes I took a trillion of your dollars to fix this and yes your health care is worse and your premiums are just as high, but vote for me anyway”. That seems like a pretty tough sell.

          1. To make them profitable or even break even, you are going to have to massively ration care.

            Well yes, that is what a lot of people are predicting as the inevitable consequence of socialized medicine.

            You don’t have to nationalize them, just de-facto nationalize them. They can still operate as individual ‘private’ companies, just private companies that can’t possibly continue to exist without a constant stream of expensive taxpayer life support. So like the financial industry or most colleges. There’s plenty of precedent for this kind of quasi-private backscratching between government and their big business monopolist friends.

            1. You don’t have to nationalize them, just de-facto nationalize them. They can still operate as individual ‘private’ companies, just private companies that can’t possibly continue to exist without a constant stream of expensive taxpayer life support.

              But there is no money for that. And that money would be huge. And for that to work, you would have to get the money in now or soon so that people are not affected. Once the spiral happens and millions lose their health insurance or see their rates double, it will be too late. Bailing out the insurance companies would just keep things from getting worse. It wouldn’t fix anything or get anyone their insurance back.

              Even you believe people have absolutely no ability to understand the world around them, they might notice that they didn’t get their health insurance back.

              1. there is plenty of money for this the problem is that those pesky “private citizens” have it all, someone really ought to do something about that.

          2. So that leaves you going back to the voters saying “yes I took a trillion of your dollars to fix this and yes your health care is worse and your premiums are just as high, but vote for me anyway”.

            You make the mistake of assuming elections will actually be decided by issues, like who’s health policy fucked up the country.

            Our elections hinge on big bird and birth control. On virtually any issue, running on actual policy results is always a tough sell for our incompetent rulers in both parties, which is why politicians largely don’t do it. Tweedles Dee and Dum will conspire to spend the whole campaign arguing about who hates babies more and make the whole election a giant Argumentum ad Chewbaccium.

            Voters will not vote on policy, they will vote because they do not understand what a wookie who lives on endor has to do with policy. This will make them confused and angry, for which they’ll either blame one shmuck or the other or stay home. Thus, a president is selected.

            1. People only decide issues on bullshit because they basically are fat dumb and happy and don’t have a lot of other things to do. If they nationalized the insurance companies, people would hold the government responsible for their personal health care and costs.

              Maybe people are as stupid as you say. Maybe the government could just start rounding them up and gassing them and the people would happily vote for more of it. But I kind of think that they tend to care just about as much as the situation requires. And as long as things are good for them, they go along and get along and fight about other issues and are easily distracted. But your life getting worse has a way of focusing the mind.

              To take your view to be true, you have to assume people have somewhere around animal level intelligence or maybe that of a small child. And maybe they do. But if that is true, we have a lot more problems than Obamacare.

              1. It is not that they must be as stupid as a child. The government is actually built to be indecipherable.

                No one would vote for gassing people, but they will not run on gassing people, they will run on big bird.

                Let’s say the public gets outraged because they realize there are gassings going on. Who’s fault is it? The bureaucracy is unresponsive and incoherent. The democrats will say it’s all the republicans fault gassing people because they hate minorities. The republicans will say it’s all the democrats fault gassing people because they hate decency.

                Who are the voters to believe? At the end of the day most of them will choose to believe someone out of desperation, even though they probably know that you can’t believe any of them because they’re all lying and this is a trick question. There isn’t a good guy and a bad guy, just 2 bad guys.

                So you’re right – the public will be outraged and want to stop the gassings. However they will have no idea how to do it or who’s actually responsible for it, because the whole system has been tailored to obfuscate that.

                Some will vote democrat to stop the republican gassings, some will vote republican to stop the democrat gassings, whoever wins either way the gassings continue.

                1. Entropy,

                  There is some truth to what you are saying. But that is more of a long term thing. As I say below, I am willing to believe that the progs will come back and get even more after the Republicans fuck things up and the media works overtime to blame them for everything. But in the sort term, that won’t save these Dems. Everyone knows who built this gas chamber. The fact that the obama was dumb enough to try and do this without a single Republican to share the blame, makes this a bit of a unique situation. Unless this gets a lot better soon, the immediate prognosis for the Democrats in Congress is very bad.

              2. “If they nationalized the insurance companies, people would hold the government responsible for their personal health care and costs.”

                To which the LIVs would demand the government “tax rich people” to pay for it. Sorry, John, but we haven’t even begun to touch peak retard.

            2. I am totally willing to say that a scenario where the Republicans come in, get brow beat and are generally feckless assholes and manage to either fuck the situation up more or not improve it enough and that results in the Progs making a come back and selling people on single payer or God knows what is possible and may even be likely.

              But no way in hell is the public not going to hold the current Dems responsible for this mess. They personally are fucked if this disaster is somehow miraculously avoided. They own it. Maybe after the Republicans get in and manage to take some of the blame and people forget, the progs will come back even stronger and get even more. But in the short term, this is a total disaster for the Dems. No amount of “but the birth control” is going to save these Dems regardless of the long term prospects of their cause.

              1. But no way in hell is the public not going to hold the current Dems responsible for this mess.

                But, look how great they have it, even in this clusterfuck.

                If this was a George W. Bush clusterfuck, all we’d see on TV would be anecdotal stories of old people saying, “Oh, no, I can’t get Obamacare… I think I’m going to die if they don’t turn the website on… why won’t they turn on the website? I’m old… I remember playing in the backyard when dad defeated the Nazis… why does the government hate me?”

                Throw in some poor minority families and some preexisting condition people, and that would be the 24/7 news cycle mantra.

                As it stands, the media act like they don’t even know what to say. They just read agency statements and move on to something else.

              2. The dems are already shifting to “It WOULD have been awesome if the republicans hadn’t sabotaged it out of greed and spite and a racist desire to deprive minorities of healthcare!”

                You know as well as I do every progressive leaning voter in america will swallow it, because it’s what they want to believe. They didn’t fuck up, they were sabotaged by the Auld Enemy/Sabines.

                1. Not everyone or even a minority is a prog entropy. The Dem coalition is the progs plus a collection of various leeches and more than a few gentry middle class liberals who like to feel good about themselves. Will 35 or 40% believe that line of bullshit? Probably. But the other 10 to 15% of the public the Dems need to win elections are not. It doesn’t take every Dem to understand what is going on and hold them accountable. It just takes enough to ensure they lose an election. And that number is not very large. Hell, they only got 52% of the vote in 2012.

                  1. I don’t think it’s a done deal that dems suffer John.

                    They may, or they may not, depending on how things play out. There are scenarios where 15% of democrats realizing their party is insane makes no difference and they still end up with majorities.

                    Alternatively, there are scenarios where they do indeed lose, but it does not matter if the Republicans who take their place end up trying to turn it into Romneycare.

                    If the Tea Party took the senate, then maybe there are consequences for these fuckups and things don’t just continue, unable to overcome the inertia. But if the democrats or even the wrong Republicans grab those seats it’s a different story.

                    And those elections won’t just hinge on healthcare. Even if dem voters disapprove of Obamacare 50% you will still have these elections being decided on many other issues (including a large array of wookie issues).

                    We’ll see.

                    1. Alternatively, there are scenarios where they do indeed lose, but it does not matter if the Republicans who take their place end up trying to turn it into Romneycare.

                      That is a real possibility. But that doesn’t help these Dems. These Dems are screwed.

                    2. I don’t know if I’d call them screwed because what does “screwed” mean for a politician in this context?

                      They get a sweet lobbying gig?

                      Some assholes may lose their seats but most of the assholes will probably see it as a promotion that you get for going out in good standing with your party establishment.

                      Some individual douchebags may lose their seats, but that’s politics and people come and go. Will it hurt Democrats as a whole?

                      If democrats kamikaze their policy preferences into being, even if they lose their seats, if the GOP does not undo and repeal those policies then the democrats win, and eventually the pendulum swings back and they get to do it again.

                      Take Colorado. Democrats will probably lose that state quite badly and I doubt they’ll have majorities in 2014.

                      But if the republicans that replace them do not undo the gun bans and whatnot before the pendulum swings and democrats get back in to do it again, democrats win because in the long run the state turns into California regardless of who’s got control of the state senate. You may call this ‘getting screwed’ but to me it looks like ‘WINNING!’

                    3. For these creatures entropy, losing office and no longer being Senator or Congressman whoever is a fate worse than death. They thrive on power. No amount of money on K Street can replace the lost power of losing an election.

                2. The Dems should move beyond simply calling the Republicans saboteurs and go full Stalin on us by calling them “wreckers.”

          3. I am not sure they could nationalize the insurers.

            They can do anything they want. Pretty much all mortgages are via fedgov, only the people in the top 10% of earnings are getting mortgages via private parties.

            What they WON’T do is pay claims indiscriminately once they nationalize the insurers. Just another step toward leftist eugenics.

            1. The problem is that you have to nationalize slowly so no one notices. That is how they nationalized the mortgage market. But, this is going to be an emergency. So they won’t be able to do it slowly and out of sight. Everyone will know they did it and hold them responsible for the results.

              These policies have gone on and on not because the public is retarded. They have gone on and on because the public doesn’t pay attention and the costs of the programs are hidden. The costs of obamacare are huge and out in the open and attributable. That changes the political dynamics of it.

        2. If you nationalize the power companies, you just have to keep the lights on and lower rates a little bit and no one will complain. You nationalize the insurance companies, you are now responsible for everyone’s healthcare and how much it costs them. That is a lot tougher problem.

          The thing people forget about the NHS is that it was created in 1946, when most people in Britain had never really had access to health care before then. So it had a really low bar to meet. People never notice what they never had. But in the US, the vast majority of the country has health care and is happy with it. That makes creating an NHS system here a thousand times more problematic than it was in Britain in 1946.

          1. you just have to keep the lights on and lower rates a little bit and no one will complain.

            But the whole point of government is to mulct other people. There is no reason to lower rates, especially since that will only exacerbate global warming.

            Nationalized energy means rationed energy.

      2. You can’t bail them out forever.

        Does GM know about this?

        1. Have we bailed out GM again?

          1. We probably will, and I think we have before. Chrysler has definitely had multiple bailouts now.

            If you want a better example, how about the post office?

            1. Do subsidiaries of multinationals qualify for bailouts?

              It will be a glorious day for the motherland, indeed, when government bailouts go to foreign corporations to save good ol’ union manufacturing jobs right here in the US of A.

              And they say markets are a race to the bottom.

              1. See Chrysler – bailed out and sold to Daimler.

                Chrysler II – given to Fiat, who took it on so they could get the bailout money attached to it.

            2. Wow. Someone needs to write an article on that, the post office model for medical care. Offices open in strange places, at inconvenient hours. Surly staff that would rather do anything but help you. Incompetent and slow service, without regard for outcomes or accuracy.

              Or is that the VA?

  25. I’ve been advocating that the GOP push for allowing any health insurance plan to qualify to avoid the penalty, including catestrophic and hospital-only plans. That would stop the death spiral, but only for the most minimal plans.

    But given how badly things are going I’m wondering if they shouldn’t just let the death spiral happen and push for a full repeal.

    1. I think the Dems themselves are going to repeal it. Suppose this thing does get bad over the next year. And the Dems get hammered in the midterms. What then? There are a lot of Dems in Congress up for re-election in 2016 and Obama would be the lamest of lame ducks. I think it is at least conceivable if things are really going badly that there develops a veto proof majority to gut this thing? Then all but the hardest left of the Dems wash their hands of it and go on to 2016 pretending the whole thing never happened.

      Yeah, that sounds crazy. But I can’t think of a single possible outcome of this that doesn’t sound crazy.

      1. I doubt it’s going to happen… I think these idiots will burn the government down rather than admit a mistake.

        The only branch that can save the govt are the courts. If it develops into a huge cluster fuck they may use the excuse of the other challenges wending their way through the system to kill the law.

        1. But they own this disaster. The public is going to hold them accountable for it. Sure maybe eventually the Dems will manage to blame the insurance companies and convince people that Obamacare was the free market’s last chance. But that won’t happen until after the public calms down and the Republicans take control and assume some of the blame. So even if the whole thing does have the Prog happy ending of single payer for all, these Democrats, or a lot of them, won’t be in office to enjoy it.

          Are they really going to go down to electoral defeat so that no one has to admit Obama, a guy who isn’t running again, fucked up? Perhaps. But isn’t it also at least possible, they will say to hell with it and do whatever they think is necessary to stay in office? They are already thinking about delaying it. That was treason last week.

      2. But every repealed aspect of Obamacare, every needed fix to health care in general, is in a free-market direction. The left will howl, and the independents squirm, and even many Republicans don’t want to see free market reforms that might cost them inconvenience or higher costs in the short run. Everyone still wants someone else to pay for their health care.

        1. That is hard. But letting the insurance companies go broke or telling people too bad you don’t have insurance or your premiums have doubled is a lot harder.

          The left’s bullshit only sells because everyone thinks someone else will pay for it. The issue is going to be “do something about my insurance” not “oh help the poor”. No one gives a fuck about the poor. They just like feel like they do. Independents are not going to squirm about anything except their own costs and reduced standard of living.

          1. But again, John, doesn’t that all assume some kind of financial sustainability to healthcare is your goal? If you get to push the “tax rich people” (in practice, borrow from China or print more scrip) button to subsidize it, the illusion that the system works can be sustained until everything comes crashing down.

            1. We will see. All I can say is that the Democrats don’t seem to be looking at this as such a good thing. If what you and entropy are saying is right, the Democrats should be euphoric right now. They are on the verge of single payer and a golden age of power. They don’t seem to be too happy though. They seem to be really panicked and upset.

              1. Valid point.

                I still have to disagree. I think a lot of the discussion is happening amongst relatively intelligent people. They tend to overestimate the general level of intelligence. And anyone with a modicum of intelligence is going to see both where this entire scheme winds up going and what a disaster tacking mass healthcare subsidies onto the general budget would wind up being. But, that ignores the pure level of idiocy out there.

                1. Let me just follow up. Most of us here harp on Sadbeard’s economic illiteracy. The scary thing is that he probably has a level of economic understanding at least a standard deviation above the mean.

    2. No that wouldn’t. The insurance needs the young invincibles to overpay for coverage that they won’t use – that is how they subsidize the sick, older and pre-existing customers – by screwing the young generation, just like SS and Medicare. Without that, the whole thing collapses.

      1. I would just add that I remain skeptical that enough of those younger generation people will buy into the system, anyway–given where the penaltax is at the moment.

        If you really want their participation, then you have to make it more expensive for them to stay out than it is to buy in, and that little penaltax isn’t anywhere near enough to get us there.

        And what it would take to get us there would be so unpopular, I’m not sure anyone outside of New York, Massachusetts, or California would vote for it.

    3. Here is another thing to remember about Obama. The only reason his sorry ass hasn’t been impeached and any number of people in his cabinet are not under indictment is because every single Democratic Member of Congress has show 100% loyalty and refused to even consider supporting any oversight or investigations into his administration. If a significant number of Democrats in Congress ever decided that “hey this IRS scandal or Bengazi or Fast and Furious and probably a lot of other things we don’t even know about is a big deal” the press could no longer play the scandals off as Republican lies. Obama would be finished. So, they might not even need a veto proof majority. Obama might sign a repeal himself if enough Dems in Congress told him to.

      1. Ummm … the House has the power to impeach and to conduct investigations, and the Rs control the House.

        Obama hasn’t been impeached because enough Rs think that won’t turn out well for them politically.

        1. A few Democrats joining them would change that political calculus completely.

  26. I’m wondering why I still get a property tax bill for Parkland Hospital. What am I paying for?

    1. Their fancy new expansions?

  27. On a side note, the favorite Clowncrat retirement scheme – pensions – depend on stable, liquid assets a’la Treasuries. I am sure they have been getting hammered actuarially with suppressed returns.


    “Assume a can opener an eight percent annual return.”

  28. Oops.

    “Assume a can opener an eight percent annual return.”

  29. “That’s because the premiums that health insurers calculated for the exchanges this year were determined based on the assumption that the penalty for remaining uninsured would be in effect, and would encourage people to buy into the market.”

    I maintain that this was probably an erroneous assumption.

    The people they’re going for, the young and healthy, just don’t think that way. They’re unlikely to start buying expensive insurance in Q1 2014 that they don’t think they need and wouldn’t buy otherwise–just because they’re afraid of paying a small penaltax in April of 2015. …especially when the penalax is so small.

    Even families with older children (under 26) who might consider starting to buy insurance for their slacker children, of those that haven’t been buying it for them presently because they didn’t think their kids really needed it, why would letting their children pay such a small penalty in 2015 scare them into buying insurance they wouldn’t have bought otherwise?

    Meanwhile, the sick and uninsured are gonna be all over this. Might be time to start thinking about shorting some health insurers through the end of Q1 2014.

    1. If Barrycares survives long enough to show its costs, the political football will be the penalty. 3.5% penalty will snag rich folks, who already have insurance.

      But what about guy making $40,000 with two kids? He’s right in the middle of the vise; gets to pay $1,400 in penalties or $5,000 for healthcare he can’t afford.

      Of course Barrycares is supposed to send him a check, but do you think the Clowncrats ran the numbers to make sure the subsidy + subtract tax checks out relative to out of pocket? Silly Clowncrats didn’t think of that part.

      1. I don’t think we’re going to have to wait that long.

        If the insurers start hemorrhaging cash come Q1 2014 or Q2 2014, because they’re paying so much out for people with preexisting conditions but there isn’t enough new money coming in from the young and healthy, then we’re not going to have to wait for reform until people get mad after April 15, 2015.

        If the insurers start hemorrhaging cash from the get go, it’s game over. You know what happens to companies that lose more than they take in? Do you know what happens to their multiples? …and it doesn’t take very long. From the moment the insurers announce their earnings to how long it takes enter a sell order–that’s how long.

  30. Its been said a million times that =

    “The Federal Government Is Really Just an Insurance Company With Guns”

    (e.g. take “Medicare/SocialSec/Medicaid + Defense” and not much else of significance is left over)

    My point =

    Will nothing else prove to the American public that – at least on the “insurance company” front* – … the federal government is completely and utterly incompetent?

    It would seem to me that the utter idiocy of the Men In Charge has finally risen to the surface in the form of the ACA, and should force people to contemplate just how badly-run EVERYTHING ELSE must be as well…

    I’d think this would be the natural reaction. But… no, I guess not so much. At the very least it should puncture *some people’s* bubble world.

    *is the US less incompetent on the National Defense/Military side?… separate debate perhaps. I have been recently dwelling on the idea that the US developed a severe misconception of its own military competence following WWII, such that we’ve repeatedly excused “lack of completely awesome results” in various engagements as ‘deviations from the norm’. As though WWII was forever to be ‘the norm’. And I think maybe Gulf I provided a very-bad booster-shot to this mental state, occurring just after the fall of the Soviet Union… basically, setting us up for another half-century of bungling interventions where we never can seem to get all the toothpaste back in the tube. (this thought may have originated w/ WarNerd GaryB.)

    1. When we were sticking by the Powell Doctrine, I think we did pretty well.

      From Post-Vietnam and the Carter Administration, overconfidence in our military was not a big problem.

      I J

      1. That wasn’t ready for posting yet…no “I J” doesn’t stand for the Institute for Justice. I meant to add…

        I just wish we’d become overconfident in exporting our culture, free trade, and economic prowess after the Cold War.

        Somehow we seemed to end up with, “Capitalism was great so long as the Soviet Union was a threat, but now we don’t need that shit anymore”.

        1. “‘Ken Shultz|10.24.13 @ 1:37PM|#

          When we were sticking by the Powell Doctrine…

          Meh. I don’t know about that. In my limited opinion (informed by a number of NatSec wonks, ex field officers, and a very few general officers’ books) “Powell Doctrine” equated to “make war so expensive that it either wont happen, or be over in 2 seconds”. And that ‘doctrine’ perhaps had applicability in basically ONE situation and never again after that.

          I never thought powell anything of a military mind, FWIW. Keane, Hammes, Nagel, more so.

          re: exporting capitalism… in theory, we did. that’s not really a top-down program. Also – you might want to read the PNAC doctrine about exporting America… probably in hindsight not the best thinking.

          1. To clarify – ‘powell doctrine’ as applied to the “once you’ve already decided to apply military force”… the ‘lead up’ to the decision being the ‘weinberger’ tests, e.g. (Wikipedia)

            1.Is a vital national security interest threatened?
            2.Do we have a clear attainable objective?
            3.Have the risks and costs been fully and frankly analyzed?
            4.Have all other non-violent policy means been fully exhausted?
            5.Is there a plausible exit strategy to avoid endless entanglement?
            6.Have the consequences of our action been fully considered?
            7.Is the action supported by the American people?
            8.Do we have genuine broad international support?[1]

            What I’m talking about is the “Overwhelming Force, Limited Specific Objective, Short Timeline, Maximum International Coalition Input, etc.”

            So restrictive as to be inapplicable except for extremely specific circumstances. For fighting “Al Qaeda” type situation? Useless.

    2. The military is overlarge and overpriced, but is very good at breaking things. If a regime needs deposed or some upstart needs a whoopin’, there’s no problem.
      It’s the politicians’ overconfidence that the military can do nation building that’s the real problem and shows where our limitations lie.

      1. “‘It’s the politicians’ overconfidence that the military can do nation building…”

        This word, ‘nation building’…

        …its a made-up idea that has never existed in any military or political realm at all.

        It was invented in the 90s to provide some kind of label for Clintonian interventions, which were thought of as ‘post-colonial/cold war stabilization’ efforts. No one has ever, or will ever intend, use the military to “build” a nation. The idea itself is a myth.

        At best its a catch-all phrase for any sorts of military application outside of full-blown Axis vs Allies type of WWI-WWII multinational global conflict. Which is a sorta silly dichotomy. Military power has always and will always be used in a spectrum of situations. People have short memories and are constantly re-naming the same old shit.

        That said… Did the US fail at ‘Nation Building’ in Japan, post WWII? Because that’s probably the only proper example of it I can think of in the 20th century.

    3. And we “won” WWII because while we were creating a diversion at Normandy, the Soviets were burying the bulk of the Wehrmacht on the steppes. We basically cleaned up against the JV team on the undercard.

      1. Simplicius Simplicissimus.

        Also a good book.

  31. “Most insurance providers do not make money off premiums – the actuarial assumption is every premium going in eventually goes out. The idea is to make money off the premium ‘deposit’ until said premium is paid out.

    Not quite. I’ve worked as an underwriter for some health insurance companies, and the actuarial department always tries to price based on getting a profit. But, it’s a competitive business, and the net result is that while you have good years where you make money and bad years where you damn near go under, over time the profit margin tends to be pretty tiny.

    1. And as has been mentioned around here in the past, the idea that the government make health care “more efficient” by eliminating profit is disproven by the fact that Medicare loses about four times much in waste and fraud as the total profits in the health insurance industry.

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  33. I think that Obamacare mandate could be delayed for a few months without significant costs. The reason being that it takes time for people to start using their insurance. It takes time for people to find a doctor that is in network. It takes time for prescription approval and such. And it takes time to start setting up hospital appointments and get procedures done. This of course assumes that the actuaries haven’t taken all that into account. If they have then the next years premiums should be even higher to accommodate the initial year slow start.

  34. like Walter explained I am taken by surprise that a single mom able to profit $5487 in four weeks on the internet. visit their website

  35. I suspect Obama’s priority now is the 2014 elections. It seem to me tHe’d prefer to at least keep a Democratic Senate, though a Democratic House would also be nice.

    1. When was the last time a President’s party picked up House seats in the sixth year of his term?

  36. I sure wish I could find out what the real penalty/tax will be for not signing up at all. This figure of $95 or a percentage of your income they were talking about earlier – is that still the way it’s going to be or has all this delay stuff changed any of that? I have no intention of signing up for it, so I wanna know what will happen.

    Comments anyone?

  37. If Demicrats are serious about avoiding the health insurance death spiral, they should do away with the three year phase in of the penalty and go right to $695 or 2.5% of family income..

    Given the premiums people are seeing, maybe they should just make it 10% now to show how serious the government is.

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