WASHINGTON, Oct. 19, 2015 − In 2010, when the Affordable Care Act (ACA) was passed − with every Democrat in Congress voting in favor and every Republican in Congress opposed − numerous promises were made to the American public. Americans could keep their plan if they liked it. They could keep their current doctors. Their premiums would fall by an average of $2,500 per year. And by 2015 more than 10 million uninsured Americans would have health insurance.
Now, as 2015 slowly draws to a close, we see that each and every one of those promises was broken, and the problems with Obamacare seem to be getting worse − although there are almost 10 million more people insured. But at what cost?
Tens of millions of Americans have been forced to change health care plans, change doctors, incur significantly higher premiums, pay much higher deductibles and often skip routine testing because it must be paid out of pocket. All of this, the president tells us, was necessary to provide insurance for an additional 10 million people by 2015.
About 85 percent of the previously uninsured receive a subsidy reducing their premiums by an average of $270 per month. That’s a cost to taxpayers of more than $27 billion annually. This is added to the higher premiums and higher deductibles that the average American now already pays for Obamacare coverage.
There are additional costs that taxpayers incur. The ACA established 23 health co-ops. These are essentially non-profit insurance companies that were supposed to provide health coverage at the lowest possible cost to consumers and keep a lid on prices charged by commercial health insurance companies, thus adding an element of “competition” to the coverage pools.
But one by one, these co-ops have been failing. Recently, Health Republic Insurance of Oregon and Colorado HealthOP said it will cease operations at the end of the year. Just days before, the Kentucky Health Cooperative and the Tennessee Community Health Alliance said they would also shut down.
All told, eight of the original 23 cop-ops that received a whopping $900 million in federal loans and provided service to more than 500,000 Americans have failed. Worse, a recent report by the Department of Health and Human Services inspector general said the remaining co-ops are “in deep financial trouble,” with more expected to close.
It gets even worse for Medicare recipients. When the ACA was passed, it included a provision that transferred funds out of Medicare to pay for the exchanges. The result is that about 30 percent of Medicare beneficiaries will see their Part B premiums rise by as much as 52 percent in 2016.
In 2016, the penalty on individuals who choose not to purchase health insurance will increase to at least $625 per year. But that figure could be even higher, based on an individual’s income. This tax − which President Obama refused to call a tax until the Supreme Court said it was a tax − will be paid by every American who freely chooses not to purchase health insurance.
In 2018, the situation will get even worse. Millions of Americans who are able to negotiate a high-quality health care package as part of their benefit package will discover they have incurred an additional tax. If an individual employee negotiates a “Cadillac” plan which costs his employers more than the Obama administration says it should, that individual will pay a 40 percent tax on the amount above Obama’s arbitrary limit. This could cost such individuals another $1,500 to $2,000 per year in taxes.
All this added expense is effectively penalizing several hundred millions of Americans just so that less than 10 million people can receive free or nearly free health insurance. Such a policy seems grossly unfair. But in addition, many Americans are receiving poorer, not better health care as a result of the ACA. Nearly every doctor and hospital administrator that I have spoken to about Obamacare speaks negatively regarding the results. Doctors are working more hours and are receiving less pay, hardly an incentive for providing quality care.
Obama also made sure that health insurance companies would be profitable, eventually coming up with payment guidelines that resulted in increased profits and a reduction in competition for ACA-compliant policies. The recent wave of health insurance company mergers have come about due to the largest companies’ ability to greatly expand profits by acquiring smaller competitors.
Anyone just looking at the big picture could have seen in advance that these results were inevitable. Adding 10 million people to the insurance rolls without adding more doctors to the system de facto had to result in poorer quality care for all. Eliminating competition had to result in higher prices. And allowing the grossly inefficient Federal government to essentially manage revenue that amounts to 1/6 of all revenue generated annually in the entire economy, was a prescription for the disaster we are experiencing now.
Repealing and replacing Obamacare or at least significantly overhauling what’s already there simply must be accomplished as soon as possible. Ultimately, the health and welfare of all Americans depend on it.