With the Obamacare rollout in full swing, several things are clear:
- Washington will decide what kind of healthcare plan you need.
- The cost of your plan is likely higher than it used to be.
- Few Americans are actually purchasing health insurance through Obamacare.
- Most Obamacare buyers are in moderate to high-risk categories.
Obamacare has been discussed at length on this blog, so none of these realities should come as a surprise. Nonetheless, Obamacare defenders just don’t seem to understand why most insured young Americans are not flocking to the exchanges. The answer is simple: It’s a losing proposition.
Insurance is a gamble. Individuals consider it it when they believe a serious negative event—a fire, a major illness, or even a loss of life—could be devastating without outside help. They are willing to purchase it when the amount of the premium seems to justify the risk of the event and the payout that would follow if that event occurred. In everyday language, people buy a policy when they weigh the odds and premiums, and think it’s a good deal. For the young and healthy it’s not. This is true for a number of reasons, but one of them is the game-changer.
Obamacare is designed to subsidize the coverage of high-risk and low-income Americans through the premiums of the young and healthy. Many Americans seemed okay with this idea when Obamacare was originally proposed, but most figured that someone else would be the subsidizers. Collectivism is often appealing to the masses when they are told that “the rich” and “big corporations” will foot the bill. When it comes time to make an individual decision, however, most opt in only when they are on the winning side of the wealth redistribution. This is why social security is required, not optional.
Put another way, the financial losers in the healthcare game will only play if they are forced to. The fine that must be paid for noncompliance is trivial compared to the cost of insurance, especially when EMTALA guarantees emergency treatment, hospitals are always willing to negotiate with non-payers, and bankruptcy is always an option. While none of these three situations is desirable, they underscore the fact that Americans without health insurance will be treated, thereby reducing the incentive to buy a policy.
There’s only one way around this. Some call it single payer, but I prefer the term collective payer. The young and healthy must be forced to contribute to a losing proposition in hopes that they will shift to the winning side as they get older. However, collectivists view seniors as financial liabilities because they are no longer working and “contributing to society.” With government in control of healthcare finance, there’s no guarantee that you’ll get the care you need down the road.
The simple truth is that young and healthy Americans will not purchase health insurance at Obamacare prices unless they are required to do so. But don’t expect Obamacare to “implode” on its own. There’s too much emotion tied up in the concept of universal healthcare, and the left will propose as many costly band-aids as needed to keep this entitlement afloat.
What’s wrong with requiring everyone to get health care anyway? Everyone uses it so everyone should have to pay for it. If forcing young people to enroll will save the program then it will be better for everyone. Medical care is too important to leave to the corporations.
When you say “everyone should pay for it”, how would you propose to include low income people on Medicaid who pay nothing and elderly on Medicare who pay little or nothing? When you say “heath care”, I assume you mean health insurance, since very few of those not covered would be able to pay out of their own pockets. When you say “corporations”, you would presumably include mutual companies like Blue Cross which are owned by the policyholders, i.e., you and me.
Requiring everyone to carry insurance is what Obamacare sought to do. As John pointed out, the penalties are not sufficient to accomplish that. But it was all a bait and switch. Obama promised to leave people alone who already had insurance. But through the ACA he made insurance companies to cancel many insured, forcing them on to the exchanges. He may have thought that he could get the young people enrolled, but he forgot that he only makes the rules and does not set the premiums. But that is just a step closer to his ultimate goal of universal health care. Meanwhile, he has a problem and that is how to pay for it until he gets everyone turned against the insurance companies.
That is not easy. He already played the income tax card last year, so income taxes are off the table. Payroll taxes don’t count and anyway he wouldn’t dare. The health insurance penalty is a pittance so he has to look for something bigger. Enter Ray LaHood, Chairman of Transportation, who has become his shill for raising the gas tax, ostensibly to save a crumbling infrastructure. LaHood, well schooled in liberal theology, skillfully avoids questions on where the $40 billion collected each year is spent.
So health care for everyone may be be a noble idea, although I doubt it, but the truth is we are out of money. I know this website is devoted to discussions of liberty and freedom, but we can never get away from the political implications. We should always realize that Obama’s legacy is at stake and read this into all his actions.
According to the law, young Americans, until the age of 26! don’t need to buy insurance and they can enjoy the benefits under their parents coverage. This is huge! Even if they work and independent they can still live on their parents’ insurance.
For those who are older than 26, it is still make sense to have an insurance, because they may be involved, like everybody, in car accidents and may need expensive medical treatments. Another major point about this law is that insurance companies cannot deny anyone anymore just because they perceive him/her as too “risky” for them.
Aliza, the 26-year old provision costs insurance companies more so everyone’s premiums go up to pay for it. You can get medical insurance for car accidents with your auto policy. If you can’t be turned down for insurance, then why not save your money now and buy insurance when you need it? This also means higher costs for insurance companies. Don’t you realize that people who buy insurance will have to pay more to make up the difference?
I would consider myself a failure if I was “enjoying” coverage under my parent’s policy until age 26, yet this provision gets cheers from the self-esteem generation.
Think about it from the parents perspective; wouldn’t it be great to help your child at college and save him/her healthcare costs?
Of course, what parent wouldn’t do what they could to help a child in a tough spot? That is not the point. They idea that this is celebrated as some great achievement is what is troubling to me. I can mooch off my parents to age 26 – awesome dude, pass me another beer!
This assumes the parents have insurance. What if the parent’s insurance got cancelled?