ObamaBux© Dwindling

As the bill we had to pass to see what was in it continues to unravel, another major stumbling block becomes apparent:

"If the health care law survives the current legal and political attacks, it will soon come up against the law of economics."

Come 2014 the so-called Exchanges are due to come on-line; these will (ostensibly) enable individuals to purchase health insurance regardless of whether or not they've previously been covered, and on a guaranteed issue basis. This means that even folks with pre-existing conditions will have automatic and immediate coverage. As one might imagine, and as we've long noted, this comes at a very steep price: premiums are expected to be (at least) 3 times current levels.

But no worries, ObamaCare© promises to subsidize those extra costs through the largesse of government printing presses (and fellow tax-payers).

As we've already seen, though, these new and expensive promises seem to run out of money (and steam) sooner than anticipated. And there's ample reason to believe that this will also be the fate of the Exchanges:

"But, starting in 2019, individuals would have to shoulder an ever-greater share of premiums as cost curbs kick in ... The law's shift of premium costs to individuals "may be difficult to sustain," opines Doug Elmendorf, director of the Congressional Budget Office.

Ya think?

Jed Graham, writing at Investor Business Daily's Capital Hill blog, makes this keen observation:

"[V]irtually no one understands what the law means or how premium subsidies will grow over time — and it’s a near certainty that the confusion extends to the members of Congress who voted for it."

Quite so, and he has a pretty devastating graphic to demonstrate what he means.

The key here is that the law does nothing to curb health care costs, which means that health insurance costs will continue to rise unabated. And they become quite substantial quite quickly, which will further exacerbate the underlying problem.

Or, as Jed succinctly notes:

"Because costs would continue to rise faster than GDP, the shifting of premium costs from the government to individuals would continue indefinitely."

So what's the good news?

Glad you asked:

"House Republicans are fighting to stop the federal government from financing state efforts to set up health insurance distribution exchanges."

The bad news, of course, is that it faces stiff (most likely insurmountable) opposition in the Senate. Still, it's a start.

Cavalcade of Risk #130, Naked beasts run wild edition: Now online

David Williams presents this week's round-up of risky posts - and hold on to your hat (and anything else you may or may not be wearing).

Also: A Very Special CavRisk Thank You to Tom at Canadian Finance for the new BC Workaround!

DIAM: That's May!

May is indeed Disability Insurance Awareness Month. One common adage is that disability insurance is sold, not bought. That is, many (most?) folks don't really understand how valuable this coverage really is, perhaps believing that their car and home insurance will take care of them if they lose income through sickness or injury.

Here's what I mean:

Inmates Running the Asylum

As we continue to march toward the precipice of government health care it is interesting to note the opinions of a practicing physician as well as a senior fellow at the Cato Institute that are being aired in public.

Michael Tanner of the Cato Institute renders his observations as quoted in the New York Post. His observation about the coming physician shortage is disconcerting. We already have a crisis of sorts even without expanded government health insurance but the trappings of Obamacrap will only worsen the situation.

The health reform bill signed into law last year is expected to significantly increase the number of Americans with health insurance or participating in the Medicaid program. Meanwhile, an aging population will increase participation in Medicare. This means a greater demand for physician services.

But at the same, the bill may drive physicians out of practice.

Why does he think some practicing physicians will leave their profession and go out of business?

Existing government programs already reimburse physicians at rates that are often less than the actual cost of treating a patient. Estimates suggest that on average physicians are reimbursed at roughly 78% of costs under Medicare, and just 70% of costs under Medicaid. Physicians must either make up for this shortfall by shifting costs to those patients with insurance — meaning those of us with insurance pay more — or treat patients at a loss.

As a result, more and more physicians are choosing to opt-out of the system altogether. Roughly 13% of physicians will not accept Medicare patients today. Another 17% limit the number of Medicare patients they will see, a figure that rises to 31% among primary care physicians. The story is even worse in Medicaid, where as many as a third of doctors will not participate in the program.

Cost shifting has been around for years, but when there are no more privately insured patients to make up for the losses then what will happen?

Michael Tanner is not alone in his observation.

Dr. Jane Orient shares similar views in her article published at AAPS online. She says that while physicians complain about low Medicaid reimbursement many also say the solution is higher taxes.

Say what?

Higher taxes will allow for, among other things, higher reimbursement for medical services.

Somehow I don't think that is in the cards.

But this observation about entitlement programs is revealing.

The very same left-leaning doctors had just finished agreeing that many Medicaid patients come to the doctor only because they are lonely or bored. They add that this is all right with them because they get paid even though the visit was unnecessary

Excuse me?

Some doctor visits are not medically necessary but rather, they are used as a sick social gathering place?

But of course she hits at the root of the problem. When something is perceived as free there is very little appreciation which can lead to abuse of the privilege.

She also touches on the much debated mandate portion of Obamacrap that requires everyone to buy health insurance if it is not provided for them.

Say that the court finds that it isn’t a tax, for purposes of invoking the taxing powers of Congress, but is instead a way of regulating interstate commerce, the alternate constitutional justification. Wouldn’t it be unprecedented for Congress to penalize inaction under the Commerce Clause?

One advocate for ObamaCare wrote to the Wall Street Journal that “countless” types of personal inaction violate the law. Most of these, however, are “if…then” situations, contingent on a previous action. “Failure to put out your campfire” assumes that you lit a fire. “Failure to wear clothes when out in public” assumes that you decided to go out; you are not required to wear clothes in the bath. “Failure to file a tax return” assumes that you have taxable income—and that one took a Constitutional amendment. The only thing close to “If you are alive, then you must buy a certain specified type of health insurance” is “If you are a male who has reached the age of 18, then you must register for the draft.” Is the insurance mandate a form of conscription? It forces us all to pay for care that we might not want to buy, or be willing to provide, without third-party payment.

You have to admit she makes a compelling argument.

With medical care, we have seemingly accepted the concept of collective responsibility—and entitlement. Under this concept, any person who is sick or injured is entitled to be taken care of. If others do not provide the care voluntarily—that’s called charity—then the government must force someone to pay.

It's the "forcing others to pay" part that really bothers me.

Why should I be forced to pay for your lack of personal responsibility? Granted, you cannot control all aspects of life by legislation but it certainly seems like the folks in Washington are going to try to force their will on us.

This is government OF the people but forsaking government BY the people.

Smaller cars, bigger government, Poppa Washington.

Where's the Beneficiary? (A Stupid Government Trick Update)

Last week, we reported on efforts in California and Florida to force life insurance companies to keep (better) track of their insureds. That effort has now expanded to at least 35 of the 57 states plus the District of Columbia, "to look at how life insurers determine whether insureds have died and how they go about locating policy beneficiaries."

Oh, puhleeze!

It is not, and never has been, the responsibility of a life insurer to track its insureds. If you move, then you darned well better let folks - including your life insurer - where you're headed. An insured has but three simple obligations in order to maintain coverage: pay the premiums, avoid fraud, and advise the carrier of one's whereabouts. As I said in the previous post, one can just imagine the hew and cry if carriers even tried to track insureds (and/or beneficiaries). This is nanny-statism run amok.

FoIB Matt H sent us an interesting link that answers at least one question: Cui bono?

"The audit indicates that Metlife did not take steps to determine whether policy owners of dormant accounts are still alive, and if not, pay the beneficiaries — or the state if they cannot be located, the regulators said." [emphasis added]

So the ugly truth is that the state does not, in fact, care about whether or not the rightful beneficiary benefits, just that the state itself gets (at least) a cut.

How banal.

Is the Pool Half Full or Half Empty?

Of course, an engineer would advise that the pool is twice as large as it needs to be:

"The insurance exchanges for people with preexisting conditions aren't living up to expectations ... [ObamaCare©] set aside $5 billion to help those folks. But one year later, few people are taking that help."

Nice that the folks at the taxpayer-funded "news" organization finally noticed this; as Bob noted several months ago, " [t]he government sold 12,500 health insurance policies in 8 months and 700,000 cars in 6 weeks."

Bob pointed out several plausible, rational explanations for the underwhelming response. NPR, not so much:

"The high-risk pools enrolling the fastest are almost all in blue states."

So it's all about politics?

No, not really: the reason that so-called "blue states" are having so much "success" with these pools is that their population is already primed for the expansion of government into the health insurance biz. And, as Bob noted, it's not like folks have been beating down the door to sign up in any state.

This particular NPR piece, by the way, suffers from what we've come to call LRS (Lazy Reporter Syndrome). We've seen this before, of course, but NPR seems to have refined it to an art.

■ Example #1:

"Jose Cortes was a Spanish teacher at a college in North Carolina until strange things started happening ... By the time doctors figured out why he'd been acting so strangely, he'd been fired. Lost his benefits."

Really? What kind of college employs less than 20 people (the threshold for COBRA compliance)?

■ Example #2:

"[H]is wife, Anne ... says he had two options: Join her health plan at work, but that would take a year because of his preexisting condition."

Hello, HIPAA anyone? As long as there was continuous coverage (and the reporter never questions this), then there's no such wait.

These are such obvious, simple holes that I find it difficult to believe much else of what's being "reported" here. It's reminiscent, as well, of Bob's expose of the Baltimore Sun; that is, these are (or should be) routine parts of the fact-check process.

Or are "reporters" absolved of these?

[Hat Tip: FoIB Holly R]

Green Mountain State Shenanigans

Courtesy of FoIB Jeff M comes this rather bizarre news from Vermont:

"At least one roadblock stands in the way of Vermont's path toward becoming the first state to adopt a single-payer health care system: coverage for illegal immigrants."

As we've noted here before, illegals make up a disproportionate share of the uninsured (d'unh!), but it doesn't seem to occur to the fine folks of Vermont that there's a good reason for this. Namely, illegals are here, well, illegally. Since criminals are not particularly well-known for playing by the rules (hence the term "illegal"), it stands to reason that they're not rushing out to buy health insurance (well, along with the fact that they couldn't if they tried).

So the solution - natch - is to simply put them on the rolls, thus shifting the cost of their health care to the actual legal citizenry. Now, we're on record as supporting the "57 state laboratory" model of health care, so of course we recognize that Vermont is free to experiment with this notion at its own cost.

There's a deeper problem here, though, and it's neatly summarized:

"When we say health care is a human right, we mean for everybody"

That is so wrong, on so many levels, that it's challenging to know where to begin.

Of course, that won't stop us from trying.

First, folks who bandy about the silly notion that health care is a "right" overlook a fundamental issue: at whose cost? That is, if the delivery of health care is a "right," then that means that the state has the power to compel providers to treat anyone and everyone, regardless of whether or not they'll be paid for doing so.

Note that I'm not saying "paid fairly" ; after all, that's a judgment call. No, I meant what I said: that they be paid at all. That is, the right to health care would trump the expectation of payment for services rendered.

Of course, what these thoughtless individuals most likely mean is that the payment for health care should be made by the state, which means thee and me. That's really the underlying premise of "universal" health "care" (to use the disingenuous and patently false terminology of its proponents). Note that there's no talk here of personal responsibility or accountability: it just "feels good."

Not a promising premise.