Health Care Frustrations Emerge As Election Issue

As health insurance companies set rates for 2019, the country is about to be reminded of one of President Trump’s biggest failures, the failure to repeal or reform Obamacare. Republicans made several attempts in 2017 to reform the Affordable Care Act, but failed to garner even the simple majority required to pass the measure under budget reconciliation rules. Now their inability to fix the law is coming home to roost in the form of higher insurance premiums for many Americans.

If you listened to President Trump last December, you might think that Obamacare was repealed. In reality, Republicans repealed the law’s individual mandate, but left most of the ACA intact. Repeal of the mandate might actually worsen the problem of rising premiums as young, healthy insureds flee from the expensive policies still mandated by Obamacare.

In March, the Wall Street Journal forecast that health insurance premiums would be an election issue after Congress failed to agree on a stabilization (i.e. subsidy) bill to shore up the individual health insurance markets. Now that forecast is starting to come to fruition as the first announcements of premium increases are being heard. Maryland, one of the first states for which information about the new insurance rates has become available, has insurers proposing an average increase of 32 percent. The proposed increases range from 18 to 91 percent.

Announcements of rate hikes, along with news of insurers withdrawing from Obamacare marketplaces, have become an annual tradition in the years since Obamacare was implemented, but rising health insurance costs don’t just affect those Americans on individual plans. Marketwatch recently reported on a study that showed that rising health insurance costs contribute to slower wage growth among the nation’s workers, many of whom are covered by group plans purchased by their employer. Group health insurance premiums were forecast to increase by about four percent for 2018.

Americans are getting less coverage despite paying higher premiums. Spending on deductibles and coinsurance, the patient’s share of medical bills, has increased in recent years as copayments have covered less. Whether you have an Obamacare plan or an employer-based plan, you are probably paying more out of your own pocket for health care than you were just a few years ago.

There are also hidden limitations that you only find out about when you have a claim. As an example, my wife had to go to the hospital in an ambulance last year. Six months after her hospital stay, we received a bill from the ambulance service asking us to pay more than $4,000 for a 30-minute ride. When I followed up with Blue Cross Blue Shield of Texas, our insurance company, I was told that the ambulance service was out-of-network. When I pressed further, I found that Blue Cross did not have any ambulance providers in their network in the entire state of Texas. As a result, Blue Cross paid less than $1,000 on a total claim of more than $5,000.

In the United States, the way that we buy health care is totally disconnected from markets and economic reality. If you have any idea what you will owe a doctor for something as simple as an office visit, you are in a minority of consumers. The problem is even worse if you go to the hospital for tests or surgery where several billing entities from the doctor to the anesthesiologist to pharmacies and labs and the hospital itself are involved. Prices are not known until after the service is provided. In many cases, the patient doesn’t even know what services are being provided or by whom.

In another personal experience, I went for a colonoscopy a few years ago. I discussed the cost of the procedure with the doctor and the hospital before I was admitted, but when the bills came later, it was more than three times what I had been told to expect. After months of running between the hospital, the doctor and the insurance company, I traced the problem to an error in the diagnostic code. It took many more hours on the phone to get this code corrected. Many patients probably simply pay incorrect medical bills without questioning whether they are correct or taking the time to investigate.

An accounts receivable representative for the ambulance service that we used told me that, because Blue Cross is hesitant to pay ambulance bills, they often send shockingly large bills to the patient. Part of the goal is to get the patient to put pressure on the insurance company to pay up. The provider doesn’t necessarily care where the money comes from as long as they get paid and the insurance company is happy if patients pay the bills and let them off the hook.

Because of the lack of competition in the healthcare system, Americans are left without options when health insurance companies misbehave. The majority of Americans who get their health insurance through an employer have no input into the choice of a health insurance provider. You can only decide whether to participate in or drop an employer health plan during open enrollment. If you decide to buy insurance from a company other than your group health provider, you lose the employer contribution to the premium. This means that you end up paying far more to buy your own health insurance that you would if you participated in the group plan.

The problem is similar for workers who like their company’s group health plan, but who leave their job. Coverage may not start at a new company for several weeks. In the meantime, health insurance premiums for your old plan may from a few hundred dollars to more than thousand.

Frustration with the existing health insurance system is probably a major reason why a majority of Americans now favor a single-payer system (i.e. government-run universal healthcare). Several recent polls have shown growing support for more government involvement in health care. In April, a Washington Post – Kaiser poll found that 51 percent of Americans favored single-payer. Gallup and Pew found similar results last year. The increasing costs and decreasing value of private health insurance is undoubtedly leading many Americans to embrace this radical idea.

Republicans have damaged themselves on the issue. The Republican health bills of 2017 were so unpopular that they turned public opinion around on Obamacare. After years of favoring repeal of the ACA, more Americans now oppose repeal than support it. CNN polling from March shows Democrats with a 20-point lead over Republicans when voters are asked which party would do a better job on health care, the largest gap of any issue.

At this point, there are no signs that Republicans are interested in fixing the health insurance problem. President Trump is basking in recent foreign policy successes, but Republicans may be hurt in the midterms if attention shifts to domestic issues like healthcare. Korean détente may mean that voters focus more on pocketbook issues instead of national security. If health insurance prices spike in October and November as Obamacare exchanges and employers hold open enrollment for 2019 health plans, it could provide Democrats with a much-needed issue with which to hammer Republicans.

Originally published on The Resurgent

Sasse, Paul, and Trump Call For Obamacare Repeal Instead of Reform

In statements echoed by President Trump on Twitter, two prominent Republican senators have called for the GOP to skip the health care overhaul and focus on simple repeal of Obamacare if Republican Senate leadership cannot find 50 votes to move the current health care reform bill forward. Earlier this week, Majority Leader Mitch McConnell (R-Ky.) announced that a vote on the health care bill would be delayed until after the July 4 recess.

In a letter to the White House quoted in the Wall Street Journal, Sen. Ben Sasse (R-Neb.) said, “On the current path it looks like Republicans will either fail to pass any meaningful bill at all, or will instead pass a bill that looks to prop up many of the crumbling Obama care structures.”

“We must keep our word,” Sasse continued. “Therefore, if on July 10 we don’t have agreement on a combined repeal and replace plan, we should immediately vote again on... the December 2015 Obamacare repeal legislation that the Congress passed but President Obama vetoed.”

Within a few minutes of Sen. Sasse’s discussion of re-introducing the 2015 bill, HR 3762, President Trump tweeted support for the idea. “If Republican Senators are unable to pass what they are working on now, they should immediately REPEAL, and then REPLACE at a later date!” Trump said on Twitter.

If Republican Senators are unable to pass what they are working on now, they should immediately REPEAL, and then REPLACE at a later date!

— Donald J. Trump (@realDonaldTrump) June 30, 2017

Sen. Rand Paul (R-Ky.) also endorsed the idea. “I have spoken to @realDonaldTrump & Senate leadership about this and agree. Let's keep our word to repeal then work on replacing right away,” Paul tweeted.

I have spoken to @realDonaldTrump & Senate leadership about this and agree. Let's keep our word to repeal then work on replacing right away.

— Senator Rand Paul (@RandPaul) June 30, 2017

The 2015 bill in question, HR 3762, was not technically a full repeal of Obamacare either since it also amended the Affordable Care Act rather than repealing it outright. A full repeal would require 60 votes for cloture in the Senate, which is far out of reach. The bill passed the Senate in a largely party line vote on December 3, 2015 by a 52-47 margin.

Sasse has not suggested a strategy for passing a 2017 version of the bill. The problem for Republicans on passage of the current health care reform bill is that nine Republican senators are reportedly in opposition to the bill. Assuming no Democrats cross the aisle, Republicans could lose no more than two senators and still be able to pass the bill.

The current Republican opposition to the health care reform is from both the center and the right wings of the GOP. Moderate Republicans such as Susan Collins (R-Maine) and Rob Portman (R-Ohio) argue that the bill hurts too many people on Medicaid in their states while conservatives such as Ted Cruz (R-Texas) and Mike Lee (R-Utah) say that the bill does not go far enough in reforming Obamacare. With eroding support from both ends of Republican political spectrum, the current bill has little chance of passage.

Sasse’s plan to revive the 2015 bill is a partial answer in that it should bring the conservatives back on board. The problem is that Republicans would still need moderate votes to move the bill forward.

When the bill originally passed in 2015, Republicans held two more seats in the Senate than they do today. Back then, two Republicans crossed party lines to vote against the bill: Susan Collins and Mark Kirk (R-Ill.). Kirk lost his seat to Democrat Tammy Duckworth in 2016, but Collins is still in the Senate and could be counted on to vote against the bill once again. That leaves Republicans with a one vote margin.

Earlier this year, The Resurgent reported that four Republican senators who had voted for the 2015 bill would refuse to vote for a bill that did not allow a slow phase out of the Obamacare Medicaid expansion. If Shelly Moore-Capito (R-W.V.), Rob Portman (R-Ohio), Corey Gardner (R-Col.) and Lisa Murkowski (R-Alaska) stick to their pledge, it would doom Sasse’s plan.

Still, a deficit of five votes is a more surmountable obstacle than the deficit of nine votes that the GOP currently faces. It is possible that pressure could be brought to bear on the four senators who previously voted for the bill that would keep them in the “yes” column.

An additional risk would be with the reform that still must come after the passage of the near-repeal. Democrats might be persuaded to join the reform effort if most of Obamacare was gutted, but they might also adopt a you-break-it-you-bought-it policy that would allow them to campaign against the Republican-created chaos in the health care markets in 2018 and beyond. Given recent Democrat obstructionism, there is little doubt which course they would take.

Still, as the Republican health care reform seems increasingly dead in the water, Sasse’s plan, long shot that it is, may be the only viable option to keep the GOP promise to repeal and replace Obamacare. 

Originally published on The Resurgent

House may have to vote on health care bill again

If you are wondering why the Senate hasn’t started working on the American Health Care Act two weeks after the House passed the bill, you aren’t alone. Bloomberg reports that the measure is stalled with the House leadership after being approved by a four-vote margin earlier this month.

According to Bloomberg, the holdup is a series of last minute amendments that were made before the vote in order to garner more support. The late changes have not been scored by the Congressional Budget Office and Republican leaders are waiting for the CBO numbers before sending the bill to the Senate.

If the CBO numbers don’t show at least $2 billion reduction in the deficit, it would doom the bill in the Senate because it would not qualify for the budget reconciliation process that avoids a Democrat filibuster. The GOP would be forced to start the process again with a new budget resolution in the House. Before the changes, the bill was projected to save about $150 billion over 10 years.

“We’ve got to wait for the CBO score to prove that you meet the reconciliation test,” said Rep. Greg Walden (R-Oreg.), chairman of the House Energy and Commerce Committee.

A Republican aide told Business Insider that Republicans expected positive results from the CBO, but were waiting for the report to be sure. “Based on the previous two scores, we believe we'll hit our target deficit reduction number but we're holding out of an abundance of caution,” the aide said.

If the House has to vote on the bill again, passage would not be a slam dunk. In the first vote, 20 Republicans joined every House Democrat in voting against the bill. The current version of the bill was specifically crafted to gain enough support from disparate Republican factions to pass. If the bill has to be changed to satisfy budget reconciliation requirements, the fragile balancing act may be upset and changes may cost too many Republican votes to pass the bill a second time.

The CBO report is expected next week. 

GOP finds no agreement on Obamacare

A meeting of Republicans with Vice President Mike Pence that went into the wee hours resulted in no agreement between Republican factions on the next attempt at reforming the Affordable Care Act. Even though Republicans represent a majority in both houses of Congress, disagreement on some aspects of the reform legislation resulted in House Speaker Paul Ryan (R-Wisc.) withdrawing the American Health Care Act from consideration last month.

Last night’s meeting included leaders of several of the various Republican factions. Rep. Mark Meadows (R-N.C.) of the Freedom Caucus, Republican Study Committee Chairman Mark Walker (R-N.C.), and moderate Tuesday Group co-chairman Tom MacArthur (R-N.J.), House Energy and Commerce Committee Chairman Greg Walden (R-Ore.) and Ways and Means Committee Chairman Kevin Brady (R-Texas) were also in attendance at the meeting.

“We're basically working on the concepts where the differences have been. We found a lot of common ground,” said Rep. Jeff Duncan (R-S.C.) in The Hill. “You find common ground, you set that aside, and then you start working on some of the differences.”

The first Republican attempt at health care reform had several problems that eventually drove many conservatives to oppose the bill. The AHCA kept two popular Obamacare provisions that require insurance companies to cover pre-existing conditions and keep children on their parents’ policies up to age 26. The bill also continued to subsidize health insurance premiums although it restructured the subsidies as refundable tax credits. The bill also would have left Obamacare’s Medicaid expansion in place through 2020.

“Even though we have a high-risk pool that deals with this, I think there's probably a lot more concern over the guaranteed issue [of insurance for people with pre-existing conditions] portion of that and what that may mean,” said Rep. Meadows.

Rep. Walker said that there was “great consensus” among Republicans on high-risk pools for people with pre-existing conditions, but did not provide detail.

Under the high-risk pool concept, the states would set up an alternative insurance plan for people with pre-existing conditions who would otherwise be uninsurable. High-risk pools typically cost more for the policy holder, but some of the cost is subsidized by taxes on other insurance premiums. High-risk pools for people who are uninsurable have been utilized by states for years.

Several Republicans said that the meetings will continue Wednesday as the caucus tries to find a consensus that can pass the House. New legislation will also ultimately have to meet the requirements of moderates in the Senate where four Republicans have promised to oppose any bill that guts the Medicaid expansion. 

Originally published on The Resurgent

Millions of poorest Americans get no Obamacare subsidies

Lost among reports of the difficulties of the Affordable Care Act’s health insurance exchanges is the news that President Obama’s health insurance reform law is actually making it harder for the very poor to get insurance coverage. The architecture of the law and the Supreme Court’s 2012 decision that struck down a portion of the Affordable Care Act have combined to create a gap for low income Americans that deprives them of Obamacare’s health insurance subsidies as well as no-cost coverage under Medicaid.

Danielle Morgan, the 23-year-old married mother of four in North Carolina, is one of those affected. Danielle’s husband is a full-time Bible college student with no income. Danielle told Examiner that she works to support their family, but her employer does not offer health insurance. The family has not had health insurance in the past, but Danielle was hopeful that the new health insurance marketplaces would allow her to purchase an affordable policy for her family and avoid Obamacare’s fine.

Even though Danielle is employed, President Obama unilaterally delayed the portion of Obamacare that requires employers to provide their employees with health insurance. The employer mandate will only apply to companies with more than 50 employees when it goes into effect in 2015.

The problem of insuring low income workers is made worse because Obamacare bans the “mini-med” policies that cover an estimated 1.4 million Americans according to an estimate by Politico. These plans were used by many employers, such as McDonald’s, to provide low-cost health coverage for low-income workers who cannot afford to pay their share of a traditional health insurance plan. Because the plans have annual limits for payouts and do not provide the federal minimum essential coverage, they do not qualify as health insurance under the Affordable Care Act. Many workers formerly insured by “mini-med” plans will likely become uninsured unless new “skinny” plans can be designed that meet the requirements of the law.

After several attempts at logging on the exchange, Danielle finally went to Kaiser’s online premium and subsidy calculator. What she found shocked and dismayed her. The premium for her family would be $5,711 per month for a Bronze plan. She also found out that her family would not qualify for a subsidy even though they are below the poverty line.

Danielle and her family fell into a gap created when the Supreme Court struck down Obamacare’s mandatory Medicaid expansion. In the 2012 ruling, the Court held that the federal government could not force the states to expand Medicaid to low income families. If states voluntarily expanded their Medicaid programs, the federal government promised to pay the full cost for three years and 90 percent thereafter. Twenty-five states, including North Carolina and Georgia, chose not to join the Medicare expansion. .

The Winston-Salem Journal estimated on Oct. 19 that as many as 300,000 North Carolinians under the poverty line may be affected by this Medicaid gap. Bloomberg, also on Oct. 19, noted that the number of Americans affected by the gap is estimated at 5.2 million nationwide.

According to the News Observer, North Carolina officials cited the cost of Medicare as well as systemic problems such as cost overruns and billing delays in rejecting the growth of the program. North Carolina’s Medicaid program cost $14 billion last year. The state’s portion was $3 billion, which represented about 15 percent of the state’s budget according to the North Carolina Department of Health and Human Services. In Georgia, Medicaid spending also makes up 15 percent of the state budget according to Georgia Health News.

“So much of our state revenue has been eaten away by the Medicaid budget,” said Justin Burr, a Republican member of North Carolina’s House health care committee. “I certainly don’t think we need to expand an entitlement program.”

The ability of the federal government to honor its promise to pay its share of new Medicaid costs is also in question. The federal government has been operating at a budget deficit for years. As the federal debt mounted during Barack Obama’s administration, congressional battles over spending have become increasingly frequent and acrimonious. In the final analysis, increased spending for the Medicaid expansion may force tax increases at both the state and federal level.

Since the unveiling of the Affordable Care Act’s health insurance exchanges on Oct. 1, many Americans have experienced cases of sticker shock. Even many Americans who qualify for federal subsidies have found that premiums are much higher than expected. Both CNN and the Fiscal Times list high prices among the top complains about Obamacare. In many cases, deductibles and out-of-pocket expenses are higher as well.

Danielle, who has a minor heart problem, says that she has not had health insurance in her adult life. She was worried about having to choose between paying the Obamacare fine and finding money for the health insurance premium for her family. There at least, there is some relief. Due to her family’s low income, she is exempt from the fine even though she will remain uninsured.

“It would be great to get coverage for just basic family doctor care at a reasonable price, Danielle said. “It just doesn’t make since to pay almost six grand for one or two visits a year with the cash price being a fraction of that.”

 

Originally published on Atlanta Conservative Examiner

A path forward for Republicans

As the government shutdown goes through its third week, poll after poll indicates that Republicans are taking the brunt of the blame. As Examiner noted last week, an NBC News/Wall St. Journal poll found approval of the Republican Party at a historic low. Generic congressional polls (summarized on Real Clear Politics), which have been in a dead heat all year, have turned against Republicans since the shutdown. Recent polling shows a consistent advantage for Democratic candidates.

Through it all, Republicans have made no headway in defunding the Affordable Care Act. In fact, the negotiations to reopen the government have shifted toward a new Democratic demand to undo the sequester cuts from last January. The sequester represented a rare GOP victory during the Obama era. It also worked. As Stephen Moore pointed out in the Wall St. Journal, the sequester law actually reduced spending and cut the deficit by about half. Removing the sequester’s spending limits would represent a major defeat for Republicans.

The government shutdown also tarnishes the Republican reputation for fiscal responsibility, an area where Republicans polled well before the shutdown. The shutdown is costing an estimated $160 million per day on the conservative side. Higher estimates rise to more than $1 billion per day in lost growth and other factors. To add insult to injury, the House voted last week to give furloughed federal workers their back pay, which means that federal workers will be paid for doing nothing if the Senate passes the bill.

Defunding Obamacare, which, as noted in Examiner last month, would require the votes of a minimum of five Democrats in the Senate (overturning President Obama’s certain veto would require the votes of 54 Democrats in the House and 21 in the Senate), is beyond the reach of the GOP and the party is taking heavy damage from its stand. Since the original goal of defunding Obamacare is clearly unattainable, where should Republicans go from here?

The Republicans should look to the Hippocratic Oath for guidance: “First, do no harm.” The government shutdown must be ended to avoid irreparable harm to the Republican Party, but, by the same token, the Republicans cannot accept a deal that ends the sequester while offering nothing in return. A return to the status quo would be acceptable, if humiliating. Writing in the Guardian, Grover Norquist proposed a deal in which the sequester is lifted temporarily in exchange for entitlement reform. Republicans should get what they concessions they can, but they must end the shutdown before it leads to a default.

After the government is reopened, Republicans need to make some strategic changes. Railing against Obamacare and just saying no don’t work. If they did, Mitt Romney would be in the White House.

First and most important, the Republicans need to start listening to the American people. The American people oppose Obamacare, but they opposed a government shutdown by even larger margins. As Examiner reported in September, 54 percent opposed Obamacare, but 71 percent opposed the shutdown. Republicans have traditionally criticized the Democrats for their attitude that “we know what’s best for you,” but the GOP has fallen into the same trap and is paying the price for it.

Second, Republicans need to change the focus of their argument. Arthur Brooks points out that Republicans cede the moral argument to Democrats and focus on materialistic concerns such as debt or abstractions such as free markets and capitalism. To the contrary, the left uses emotional arguments, caring for the poor, to advance policy agendas that actually hurt the poor. Brooks’ concern is borne out by CNN exit polls that show a staggering 81 percent of the voters who thought caring about people was a candidate’s most important quality voted for Barack Obama.

In Brooks’ view, the answer is to focus on how conservative policies help people. This does not require changing conservative principles; instead it means reframing arguments to say, “We will fight for you and your family” rather than fighting against things, such as Obamacare.

When the government shutdown is ended, Republicans will be able to return the focus to why Obamacare is bad for the American people. This should be an easy task given Obamacare’s disastrous debut. The much-vaunted health care exchanges are plagued with glitches that make it difficult for consumers to log on and purchase insurance. Consumers who are actually able to navigate the exchanges often find that their insurance premiums have gone up due to the new law. As the Chicago Tribune notes, deductibles, the share of medical bills that the consumer must pay before insurance kicks in, are also increasing. This means that not only are Americans paying more up front for health insurance, they are paying more when they go to the doctor as well.

The Republicans should be talking about how these premium increases affect families across the country who are still reeling from the Great Recession and its lackluster recovery. They should be standing with Americans like Adam Weldzius, the 33-year-old single father in the Chicago Tribune article who has to choose between an insurance premium that doubles or a deductible that triples.

Finally, Republicans must go beyond saying “no” and communicate a positive vision for the future. It isn’t enough to want to repeal Obamacare, for example. Rising health care costs will still be an issue if and when the Affordable Care Act goes away. Karl Rove presented some ideas for conservative health care reform in August and Examiner covered the topic last year, but these have been the exceptions. For the most part, the Republican message on health care has been negative.

Finally, Republicans need to remember who the real adversary is and focus their attention on President Obama and the Democrats rather than bashing each other. To defeat the Democrats and repeal Obamacare, the Republicans must unite and find a common voice. Interparty bickering and squabbles drown out any positive message that the Republicans try to convey to voters.

As President Reagan was fond of saying, “The person who agrees with you 80 percent of the time is a friend and an ally — not a 20 percent traitor.” Nevertheless, Republicans like John McCain, Lindsey Graham, and John Cornyn have had their reputations trashed and been the victims of vicious personal attacks. Yet, when their records are examined, the American Conservative Union gives them lifetime ratings of 82 percent, 89 percent, and 93 percent respectively. All three have consistently voted against Obamacare.

The shortsightedness of the Republican Party threatens not only the possibility of GOP control of the Senate after the 2014 elections, but continued control of the House as well. A few simple midcourse corrections might persuade Americans that the Republican Party is a viable alternative to the Democratic habit of taking money from Americans to fund programs that harm them.

 

Originally published as Atlanta Conservative Examiner

Oklahoma lawsuit may deal Obamacare ‘fatal blow’

The Supreme Court upheld the constitutionality of the individual mandate in 2012, but now another lawsuit is challenging the Affordable Care Act on different grounds. The new lawsuit, brought by the State of Oklahoma, has its roots in a legal paper by Jonathan Adler, a professor at Case Western Reserve University, and Michael Cannon, director of health policy studies at the Cato Institute. The paper, “Taxation Without Representation: The Illegal IRS Rule to Expand Tax Credits Under the PPACA,” argues that, according to the language in the law, Obamacare’s health insurance subsidies can only be applied to state exchanges, not exchanges set up by the federal government.

As Dick Morris explained in The Hill on Oct. 8, Section 1311 of the ACA establishes state health insurance exchanges. Section 1401 stipulates that refundable tax credits, the subsidies, are available only for health insurance purchased in Section 1311 exchanges, those set up by the states. Morris argues that the intent of Congress was to establish subsidies as an incentive for states to set up their own exchanges.

Only 16 states and the District of Columbia elected to form state health exchanges in spite of the promise of subsidies. One of these states, Oklahoma, filed suit in Pruitt v. Sebelius, challenging an IRS ruling that extended both the individual and employer mandates to all states according to lawyers.com. The suit claims that the employer mandate to provide health insurance to employees or pay a fine should not apply to states that did not set up their own health insurance exchanges. It also challenges the subsidies.

Although filed in 2011, a stay was issued until the Supreme Court ruled on the constitutionality of the Affordable Care Act. The federal government moved to dismiss the lawsuit after the stay was lifted, but a federal judge let stand the complaints against the employer mandate and subsidy. The court also ruled that the State of Oklahoma has standing in the suit as a large employer. The case is currently pending before the Eastern District United States Court of Oklahoma.

If the court eventually sides with Oklahoma, John Goodman of the National Center for Policy Analysis argues that it would be a “fatal blow” to Obamacare. “With so many states declining to set up exchanges,” he says, “Obamacare will be a disastrous failure if the courts agree with them.”

A victory for Oklahoma would also likely apply to other states, such as Georgia, that decided not to set up their own health exchange. As reported by Examiner, Governor Nathan Deal announced Georgia’s decision not to create an exchange in November 2012.

If the courts rule that the employer mandate and insurance subsidies do not apply in states with federal exchanges, it would destroy the delicate balance of the law in those states. Employers would not be fined if they declined to provide coverage for their employees. While the mandates for Obamacare’s “essential health benefits” would still apply in all states, subsidies would not be allowed in states with federal exchanges, making the cost of insurance prohibitively expensive.

While a court decision would not strike down the Affordable Care Act immediately, it would render the health law virtually nonexistent for employers in a majority of the country. While the individual mandate and fines would still apply, the lack of subsidies would mean that more people and companies would choose to opt out of purchasing insurance and the risk pool would shrink. Obamacare depends on young people buying expensive insurance to subsidize older and less healthy people.

If young, healthy people opt to pay the fine and employers choose not to provide health insurance, Obamacare will likely collapse under its own weight in short order. With Republicans controlling the House of Representatives, a new health care fix would require a bipartisan agreement, unlike when Obamacare was passed in 2010 with Democratic majorities in both houses and no Republican votes.

It seems as though Congress should have actually read the bill before they passed it.

Originally published on Elections Examiner

What the new Obamacare exchanges will mean to you

The Affordable Care Act’s, “Obamacare’s,” health insurance exchanges will open on Oct. 1 barring a last minute deal by Republicans and Democrats to delay the onset of the law. As the open enrollment period for the health care exchanges begins, Americans will be able to sign up for health insurance on their state exchange, also called health insurance marketplaces. The health insurance exchanges are only the most recent part of Obamacare to take effect. Some portions of the law took effect immediately on passage of the law in 2010 or in the years since.

If you currently have insurance coverage through your employer, Medicare, or Medicaid, you will not need to visit an exchange to purchase coverage. An exception to this is if you work for one of the many companies that are dropping health insurance coverage for their employees due to rising premium costs. Workers with company health insurance plans can also choose to buy coverage through their state exchange if their company’s plan does not meet certain standards. Workers who choose to participate in the marketplace in lieu of their company health plan may lose any employer contribution to their health insurance.

If you would like to shop for health insurance on your state exchange, you can find the web address through the Dept. of Health and Human Services website at http://finder.healthcare.gov. Registration for the site will be available after Oct. 1 when the exchanges open. Open enrollment on the health care exchanges will last until March 31, 2014. Coverage purchased after Oct. 1 on the exchanges will take effect on Jan. 1, 2014.

There will be several different health insurance plans offered on the state exchange. All plans will be required to offer certain minimum levels of coverage, but additional features will be available for an additional cost. Users of exchange websites will be able to compare plans and costs in plain language.

The individual mandate requiring that all Americans purchase health insurance will take effect in 2014. When filing income taxes in 2014, Americans will be required to prove that they have health insurance or pay a fine. There are two ways to calculate the fine. In 2014, the fine will be $95 per adult and $47.50 per child. The maximum will be $285 per family. Alternatively, the fine could also be capped at one percent of family income. The fine will be prorated on a monthly basis.

Under certain circumstances, taxpayers can receive an exemption from the individual mandate fine. Situations where exemptions are permissible are listed at https://www.healthcare.gov/exemptions/ and exemption applications will be available on health insurance exchange websites. No exemption application will be required if your income is low enough that you are not required to file or pay taxes, if you live outside the U.S., or if your gap in coverage is less than three months.

The fine will increase in coming years. In 2015, the fine rises to $325 per adult and $162.50 per child with a maximum of $975 per family or two percent of family income. In 2016, fines will be $695 per adult or $347.50 per child with a maximum of $2,085 per family or 2.5 percent of family income.

While the fine is far less than the unsubsidized price of insurance, Americans who choose to pay the fine instead of buy insurance will run the risk of large out-of-pocket costs. Open enrollment on the health care exchanges will last from Oct. 1, 2013 to March 31, 2014. In subsequent years, open enrollment will last from Oct. 15 through Dec. 7 unless the individual has a qualifying life event. While insurance companies will no longer be allowed to deny preexisting conditions, individuals without insurance may have to pay their own costs until the next open enrollment.

Whether the exchanges prices for health insurance are good largely depends on the individual. An analysis by Forbes found that on average health insurance prices will increase by 99 percent for men and 62 percent for women. In general, because Obamacare uses health insurance premiums from healthy young people to subsidize those with health problems or those who are older, people with preexisting conditions and senior citizens might expect lower premiums while younger people will pay more.

For some Americans, the increasing cost of health insurance may be at least partially offset by the subsidies offered by Obamacare. To qualify for these subsidies, the individual or family must not be eligible for Medicare, Medicaid, or have affordable health insurance (defined as less than 9.5 percent of gross income for the employee only) from their employer. Subsidies are income based. Americans with incomes between 100 and 400 percent of the federal poverty line, less than $46,000 for individuals or $94,000 for a family of four, may qualify. The subsidies will be paid in the form of refundable income tax credits.

The Kaiser Family Foundation has developed on an online estimator for the government’s health insurance subsidies on their Kaiser website. According to Kaiser, an individual earning $30,000 would receive a $24 subsidy on their annual $2,535 premium. A family of four that earns the same amount would receive a subsidy of $6,677 on their $8,642 premium. This would pay 77 percent of the family’s health care premium costs.

There are more changes on the horizon as the Affordable Care Act continues to be implemented. The next big date will be Jan. 1, 2014. As HealthCare.gov notes, several more changes take place then. These include the requirement that insurance companies accept preexisting conditions (which most have already complied with voluntarily), the expansion of Medicaid eligibility to include adults up to 138 percent of the federal poverty level ($15,800 for individuals or $32,500 for a family of four), the elimination of lifetime limits for payouts on health insurance policies, and the expansion of small business tax credits.

Originally published on Elections Examiner

GOP shoots self in foot with defund vote

The House Republicans collectively took careful aim at their feet and fired today with a vote to defund the Affordable Care Act, popularly known as “Obamacare.” The continuing budget resolution passed this morning, largely along party lines. One Republican, Scott Rigell of Virginia, voted against the measure and two Democrats, Jim Mathison (Utah) and Mike McIntyre (N.C.), voted for passage according to CNN.

The vote to defund comes amid a flurry of warnings from GOP strategists that defunding Obamacare is impossible and will likely backfire on the party. Sen. Marco Rubio (R-Fla.) told Newsmax on Sept. 18 that “the president appears now politically to be in favor of shutting down the government” in order to score a “political win.”

Two days earlier, Republican National Committee Chairman Reince Priebus said, “I think he wants this thing to happen, a shutdown of the government.” The comments, made on the Hugh Hewitt Show, were quoted in the Huffington Post.

If President Obama wants a government shutdown, the Republicans appear to be eager to give it to him. The budget resolution will now go to the Senate, where the Democratic majority will either do nothing or amend the bill to include funding for the health care and then send it back to the House. The showdown will continue until one side loses its nerve, which may well come after the government shuts down.

It is likely that Obama wants a government shutdown in order to distract from the economy and Syria, as well as to make Congress the obvious scapegoat for national problems. According to the Daily Caller, Obama’s campaign group, Organizing for America, is already running ads that attack Republicans for attempting to shutdown the government. The ad points out that Social Security and unemployment checks will be affected if the government shuts down.

On Sept. 18, pollster and strategist Dick Morris argued that the debt limit, not Obamacare is where the GOP should make a stand. In Morris’ view, there is a logical connection between spending and debt that is lacking in the movement to defund Obamacare. By focusing on spending and entitlements, which have expanded dramatically since 2008, Obama would be placed on the defensive.

Karl Rove also called the defunding strategy “self-defeating” in the Wall Street Journal on Sept. 19. Rove notes that independent voters increasingly resemble Republicans. With President Obama and the Democrats sinking in issue-based polls, the Republicans have a lot to gain in next year’s elections if they do not alienate the independent voters that they need to win.

Rove notes that the one issue in which independents disagree with Republicans is the issue of defunding Obamacare. Rove’s group, Crossroads GPS, polled independent voters and found that they oppose defunding Obamacare by 58 to 30 percent.

Rove also takes aim at claims that Republicans will be able to blame the shutdown on Barack Obama and the Democrats. Overall, independents reject the Republican argument that Obama is at fault by 57-35 percent. In battleground states, independent voters favored Obama’s claim that Republicans were to blame by 59 to 33 percent. Even in districts that lean Republican, voters accept Obama’s argument by56 to 39 percent. The 2014 Senate races currently favor the GOP according to Examiner’s analysis, but a government shutdown could change that.

On the contrary, Rove presents an alternative strategy of delaying the implementation of Obamacare, a strategy that has a precedent from President Obama himself. Rove’s poll found that independents favor delaying the individual mandate by 51 to 42 percent.

Rove also contradicts the Republican belief that the party did not suffer after the Clinton-era government shutdown. While acknowledging that the GOP won two Senate seats in 1996, he points out that the party “lost three House seats, seven of the 11 gubernatorial races that year, a net of 53 state legislative seats and the White House.”

It is certain that the Republicans will not be successful in defunding Obamacare. Simple math can establish that beyond a doubt. It would take five Senate Democrats to pass the budget resolution. When Obama vetoes the bill, as he is certain to do, 54 House Democrats and 21 Senate Democrats would be needed to override the veto. So far, the GOP has been joined by two Democrats.

What is not certain is what the ultimate outcome will be. Thus far, President Obama is refusing even to negotiate on the debt ceiling or the budget resolution according to the Washington Post, lending credence to the notion that he wants a government shutdown. In the end, the token concessions that the Republicans may win in the confrontation will be at the risk of losing of the 2014 elections, the only route to the full repeal of the Affordable Care Act.

Originally published on Atlanta Conservative Examiner.

Defunding Obamacare is GOP’s ‘mission impossible’

In recent weeks there has been a push among members of the Republican Party and Tea Party activists to “defund” the Affordable Care Act, “Obamacare.” The Republicans have devoted considerable time and energy to the repeal of Obamacare, which is driving up health insurance costs around the country according to UPI. According to NBC News, by the beginning of August the Republicans in the House had voted to repeal Obamacare no less than 40 times.

The problem for the GOP is that Democrats control the Senate and the White House. Repeal bills from the House die in the Senate, usually with a party line vote. If a repeal bill did somehow pass the Senate, it would face a certain veto from President Obama.

If Republican bills to repeal Obamacare have failed 40 times, what makes them think that a bill to defund the president’s health care reform can make it through the Senate? The plan, formulated by Senator Mike Lee (R-Utah), centers around a pledge to “not support any continuing resolution or appropriations legislation that funds further implementation or enforcement of Obamacare.”

The defund Obamacare movement has several hurdles. The first is getting enough Republican support. Lee’s plan is supported by Senators Ted Cruz (R-Tex.), Marco Rubio (R-Fla.), and Rand Paul (R-Ky.). In all, about a dozen Republicans have signed onto the plan so far. Cruz told CNN on August 27 that 41 senators or 218 representatives would be needed to make the plan work. There are currently 233 Republican representatives and 45 senators. This means that the plan would require near unanimity among Republicans.

The second hurdle is negotiations with congressional Democrats. While the Democrats have never voted to repeal Obamacare, some new Democrats accept that Obamacare is deeply flawed and unworkable. Others might be persuaded to work with Republicans to fend off election year challenges. A compromise with congressional Democrats would be difficult but not impossible.

The final hurdle is President Obama. In 2011 and 2012, the two parties entered negotiations to raise the federal debt ceiling. At the end of 2012, the parties negotiated to avoid the tax cliff, a number of new taxes and tax increases scheduled to automatically go into effect. In each case, Obama adamantly opposed even token spending cuts. According to Bob Woodward’s book, “the Price of Politics” (excerpted in the Washington Post), Obama was willing to take the country to the brink of default and total financial collapse to avoid cutting federal spending in 2011. The story was the same in the tax cliff negotiations when, as reported by Examiner in December, the president refused to consider any plan that did not raise taxes.

The first test of the plan to defund Obamacare would likely come by mid-October when the federal government reaches its spending limit. Congress must act to raise the debt limit again before the limit reached and President Obama is refusing to even enter into negotiations over the increase. Where once Obama was considered by some to be “the adult in the room” during negotiations, he now seems more akin to a toddler who holds his breath until he gets what he wants. This is the man with whom the Republicans plan to issue an ultimatum to defund his signature piece of legislation. Last week, Cruz told Fox News that he believes that the president might agree to defund the Affordable Care Act. He did not say how he thought Obama might be persuaded to do so. A more likely scenario is that Obama would act unilaterally to raise the debt ceiling without Congress as the Democrats threatened last January.

Rasmussen reported on August 26 that a majority of Americans are still opposed to Obama’s health care law by a margin of 54-41 percent. Nevertheless, a poll commissioned by Republican members of Congress in early August found that 71 percent oppose shutting down the government to fight Obamacare according to the Washington Examiner. Among Republicans, 53 percent oppose a shutdown compared to 37 percent in favor. A more recent Rasmussen poll on August 27 found that 42 percent of Republicans thought a government shutdown would be good for the party while 28 percent thought it would hurt and 14 percent believed it would have no impact.

In practical terms this means that a government shutdown could jeopardize Republican chances of victory in the 2014 elections. As detailed in Examiner last week, Democrats are defending 20 seats to the Republicans’ 15. Of seven open seats, five are currently held by Democrats and three of these are in red states. The current Rasmussen generic congressional ballot favors the GOP by one point. The GOP had a similar edge in the 2012 elections and actually lost two seats in the Senate.

With less than two months left before Congress must act on the debt ceiling, it is unlikely that enough Republicans will sign onto the plan to block funding for the law. If Republicans did unite around the effort, the result would most likely result in a stalemate that would bring the country to the brink of a government shutdown. Given President Obama’s past history in such showdowns, he would be willing to allow the country to default and use the ensuing crisis as a weapon against the GOP. For example, Obama could delay military pay and entitlement checks or even making payments on the national debt while blaming Republicans. Republicans would be forced to choose between defunding Obamacare or a national default. Few would choose to default.

Even if Republicans were successful in their defunding effort, it might still not stop Obamacare. A Congressional Research Service report requested by Tom Coburn (R-Okla.) in July indicates that implementation of Obamacare would likely continue in a government shutdown for two reasons. First, some funding from discretionary and mandatory funds would still be available. Second, exceptions to the Anti-Deficiency Act would allow some pre-authorized spending to take place.

The long odds against defunding Obamacare bring to mind Pickett’s Charge or the Charge of the Light Brigade, a valiant effort that is doomed to almost certain failure. Nevertheless, some Republicans might personally benefit from a situation even as their party loses. The Washington Post points out that Cruz, Rubio, and Paul may well use the effort to make themselves more attractive as presidential candidates for 2016.

Coming soon! A better plan for Obamacare.

Originally published on Elections Examiner

IRS manager in problem office got bonuses, now leads Obamacare unit

Sarah Hall Ingram was the IRS official in charge of the Internal Revenue Service Tax Exempt Division from 2009 through 2012. Her division has recently made headlines as part of the IRS that singled conservative groups who were seeking tax exemptions.

One might expect that Sarah Hall Ingram would have been dismissed from the IRS after President Obama announced his displeasure over the IRS scandal. Obama requested the resignation of acting IRS commissioner Steven Miller after the scandal broke.

In reality, the IRS confirmed Friday to ABC News that Ingram, rather than being fired or demoted, now heads up the IRS Affordable Care Office. The Affordable Care Act dramatically expands the size and power of the IRS by putting the IRS in charge of enforcing the individual and employer mandates. The IRS also controls and regulates the Affordable Care Act’s federal subsidies for health insurance.

Paul Ryan (R-Wis.), the Republican candidate for vice president in 2012, called the IRS connection to Obamacare “rotten to the core.” Speaking today on Fox News Sunday, he said, “The IRS is now going to be granted huge amounts of unprecedented power over our health care in the implementation of Obamacare. And so this is just rotten to the core. This is arrogance. This is big government cronyism. And this is not what hard-working taxpayers deserve.”

Other conservatives wondered whether the IRS might limit the availability of health care, health insurance or federal subsidies in cases where patients were critical of the Obama Administration or the federal government. In answer, Rep. Tom Price (R-Ga.) has introduced the Keep the IRS Off Your Health Care Act of 2013. The law would prohibit the IRS from implementing or enforcing the Affordable Care Act’s provisions.

Acting Commissioner Miller’s firing has also been greatly exaggerated. ABC News also reported that Miller’s 210 day term would have expired on June 8. In the meantime, Miller is still on the job. No final date for his departure has been announced. A copy of his resignation letter to IRS employees in the Washington Post referred to Miller’s focus “on an orderly transition,” which seems to imply that his departure will not be immediate.

The brunt of the blame seems to be falling on Joseph Grant, who became deputy commissioner of the tax exempt division in 2007, serving under Ms. Ingram. Grant was promoted to Ms. Ingram’s old position only two days before the IRS announcement that sparked the scandal. USA Today reports that Grant will retire on June 3.

The Washington Examiner also reported this week that Sarah Hall Ingram received more than $100,000 in bonuses during her tenure as the head of the tax exempt office. During the years from 2010 through 2012 when IRS persecution of conservative groups was at its highest levels, Ingram received between $26,000 and $35,000 in annual bonus money. Ingram also received a bonus of $47,900 in 2004. During the four years in question, the average bonus paid to IRS employees was $5,500.

The Examiner points out that Office of Personnel Management guidelines state, “If the recommended award is over $25,000, the Director of OPM reviews the nomination and forwards his/her recommendation to the President for approval.” The guidelines also note that managers should ensure that “the proposed award recipient has not been involved in any action or activity that could cause the President embarrassment.…”

Originally posted on Examiner:

http://www.examiner.com/article/manager-of-irs-scandal-office-now-heads-obamacare-unit

Seek medical care now–before Obamacare takes effect

Last year, my mother found out that she had colon cancer. A few weeks later, my wife was determined to have an early stage of cervical cancer. While it is never good to hear a diagnosis of cancer, they were fortunate to receive their diagnoses when and where they did.

My mom was diagnosed in October with stage three colon cancer. Within a week, she was undergoing lifesaving surgery in one of Atlanta’s top hospitals. She was fortunate have access to care in an American hospital. The colon cancer survival rate in the United States is among the highest in the world.

According to a study quoted on Web MD, the United States, Japan and France have the highest survival rates among 31 ranked countries for four types of cancer including cancer of the colon. In spite of the fact that Obamacare was yet to come, the United States ranked at the top for survivability of all four types of cancer.

This may be because of the ready availability of health care in the U.S. In 2002, a Commonwealth Fund study cited in Politifact that showed that only five percent of Americans reported waits of longer than four months for surgery compared to 23 to 38 percent in the other nations ranked, all of which had government health insurance programs. The wait time for my mom was only a matter of days. With the cancer already at stage three and in her lymph nodes, waiting longer might well have cost her life.

Scant weeks after my mom’s surgery, my wife was found to have precancerous cells in her cervix. A hysterectomy was scheduled for about four months away. When a subsequent biopsy revealed that the cells had progressed to stage one cancer, the surgery was moved up to early January, at the time less than a month away.

At the same time that my wife was waiting for her surgery, I read how Canadian women were dying while waiting for the same operation. Global Montreal reported that the wait times for Quebec women with similar cancers were three times as long as government benchmarks. Instead of less than a month, Quebec women often had to wait three months for their surgery. Thousands had to wait as long as six months. The long wait times led some patients to forego their free government health care to seek treatment at private clinics.

“This should not happen,” Lucy Gilbert, director of gynecological oncology at McGill University Health Centre, told Global Montreal. “No matter how good your surgery is, no matter how good your chemotherapy is, if you delay the surgery there could be a problem. The cancer grows. The cancer spreads.”

In my wife’s case, the hysterectomy removed the entire cancer, which had been caught at an early stage. With an aggressive cancer such as this, especially one that is detected late, as ovarian cancer often is, a delay of three to six months can be a death sentence for the patient.

My final recent brush with cancer was my own colonoscopy. After my mom’s experience with colon cancer, my doctor recommended that I be screened. The only delay to my colonoscopy was working around my busy schedule. I could have had my screening two days after my initial consultation if I could have worked it in.

The procedure was painless. When people tell you that the preparation is the worst part, believe it, but even this isn’t any worse than a case of bad diarrhea.

In my case, it was worth the hassle. When I woke up after the procedure, the doctor told me that they had removed two polyps from my colon. A phone call several days later informed me that one of the polyps was benign but that the other likely would have become cancerous. Thank you, Dr. Sanford and thank you, mom!

The lesson to be learned here is that important health tests and procedures should not be delayed. In the best of times, while you delay a procedure, the cancer inside of you could be growing and metastasizing. Cancer is best treated early before it has a chance to spread.

Now there is another reason not to delay taking charge of your health. The Affordable Care Act, better known as “Obamacare,” became law in 2010, but it has not been implemented fully. Many aspects of the law will become effective in 2014 according to Healthcare.gov. In 2015, the site ominously promises that physician pay will be “based on value not volume.”

This column and many other conservative voices have warned that the centralized control of health care will inevitably lead to shortages, rationing, and long wait times. Nevertheless, President Obama’s reelection victory was the death knell for any chance to repeal or reform the law in a meaningful way before it is implemented.

Obamacare will soon be a reality for all Americans. The precise effects of the law are still largely uncertain and controversial, but early indications are that they will not be good. This week health insurance companies warned that premiums for individuals and small businesses could increase by more than double their current rate. The country already faces a shortage of doctors and this will likely be made worse by the influx of insured patients under Obamacare. This is typically the result of an artificial increase in demand for a product.

No one can know how Obamacare would have impacted my mom or my wife, but there is no doubt in my mind that if the law had been in full effect, there would have been a much greater chance that I would have lost both my mother and my wife to cancer in 2013. For me, that is reason enough to fight for the law’s reform and eventual repeal. Repealing Obamacare is vital to save lives that might otherwise be lost while patients sit waiting for vital surgeries or treatments.

Obamacare won’t crash the American health care system overnight, but it is likely that it will become increasingly difficult to see a doctor or get necessary medical care in a timely manner. The safest course of action is to take charge of your health and get any necessary medical tests or procedures done before the law can take effect.

Originally published on Examiner.com:

http://www.examiner.com/article/get-medical-treatments-and-tests-now-before-obamacare-takes-effect?cid=db_articles

Gun shortage shows future of Obamacare

The news that the threat of new restrictions on the Second Amendment has spurred a sharp increase in the number of Americans seeking to buy guns should not come as a surprise to people who consider the incentives created by the actions of government. In many ways, the run on guns reported last week by Examiner can shed light on what can be expected as the reforms of the Affordable Care Act go into effect.

In economic terms, the run on guns is the result of an artificial increase in demand. This is driven by the threat of interrupting the supply of guns, particularly assault weapons like the AR-15. People who think that they might want to own an assault rifle are buying one now, while they are still legal, rather than waiting.

The effect of this increased demand is two-fold. Some retailers, like the pawn shop in Cartersville, increase the price of their AR-15s to react to the increased demand. As the price of the guns increased, more and more buyers found themselves priced out of the market. Eventually the price and level of demand would find equilibrium, where the number of guns and the number of buyers would be equal.

Other stores, like Atlanta’s Bass Pro Shop and the Barnes Store in Carrollton, that did not increase their prices to reflect the new levels of demand, found that their stock of the guns was quickly depleted, leading to a shortage. The price that they charged was based on the old, lower level of demand so there were too many buyers for the supply of guns.

The lessons on supply and demand learned from the increased demand for guns apply directly to the changes that are forthcoming in the market for healthcare. When the Affordable Care Act goes into full effect next year, the Congressional Budget Office estimates that there will be an additional 14 million Americans who become covered by health insurance. This represents a massive increase in the demand for health care services. This will be a permanent increase in demand rather than a temporary one as with the gun buyers.

The assumption made by the architects of the Affordable Care Act was that most of America’s uninsured were young people who chose not to purchase insurance because they were healthy. It was believed that these young people would purchase health insurance policies to comply with the law, but then not use them. In effect, the young and healthy were being forced to purchase insurance to subsidize the older and sicker people.

The assumption that new insureds will not use their insurance is probably not a good one. The Kaiser Foundation estimates that by 2016 the average annual premium for an individual health insurance policy would be approximately $5,000. For a family, the average premium would be $12,500. The national average salary is $42,979 according to the Social Security Administration. This means that 11 percent of the average individual’s salary will go to pay for health insurance. If the worker is the single breadwinner supporting a family, health insurance costs will eat up nearly 30 percent of his income. (In some cases, these insurance premiums will be paid in part by government subsidies. The Kaiser Foundation offers a calculator to estimate premiums and subsidies here.) It seems likely that if a person is forced to spend thousands of dollars each year for insurance, they will use it as much as possible. They will avail themselves of the preventive care services in their plans and go to the doctor for each sniffle, cough, sneeze and stubbed toe. This will translate into almost immediate shortage of doctors.

The dramatic increase in demand for health care services will disturb the equilibrium in the market. In a free market, the increase in demand would lead to an increase in prices. In the real world, health care is not a free market. Prices are already somewhat controlled by the government, through reimbursements for Medicare, Medicaid and Social Security, and by insurance companies with negotiated rates.

There are several possible responses to the increased demand. The most obvious would be to increase the number of doctors to match the new demand. The problem is that doctors take years to train. Medical school takes four years after obtaining an undergraduate degree. After medical school, new doctors do a one year internship, followed by four to six years of residency, depending on their area of specialization. Essentially, it takes a decade to fully train a doctor, not counting the undergraduate degree. Even if we start training multitudes of new doctors now, they will not fully enter the system for another ten years. To cut the training time short would sacrifice the quality of the education and the depth of experience.

A second possibility would be to allow doctors to raise their prices. As with the AR-15s in the pawn shop, when prices rise, more buyers find that they don’t really need that product after all and demand falls. To some extent, insurance companies are trying to control the cost of health care by using increased cost sharing already. Many health policies are moving away from flat copayments to a model where the insured pays a percentage of the cost of their care. In theory, this means that the insured will shop for better prices and use less care. In reality, few people know how much their care will cost until they have already received it.

The problem with letting prices increase is that one of the stated goals of the Affordable Care Act was to reduce the cost of health care (or to at least slow its rate of increase). Higher prices are certain to be unpopular with voters as well as politicians. Prices are already starting to rise because of new coverage mandates and community rating according to a study by the American Academy of Actuaries detailed in Forbes.

The other alternative is for the government to impose price controls. The effect of price controls can be seen in the gun retailers who maintained the price of their AR-15s below the actual market rate. High demand means that there are not enough guns, or health care, to go around. Doctors will not accept new patients. Existing patients may not be able to get an appointment when they need one. Waiting rooms will overflow and wait times will be long. Patients who are truly sick might not be able to see a doctor when they really need one.

Think this can’t happen? It already has.

Because government reimbursement rates for Medicare patients are below market rates, there is already a shortage of doctors for Medicare patients. The Atlanta Journal reported last year that many Georgia retirees are unable to find a doctor who will accept Medicare. The problem is not limited to Georgia, however. According to the New York Times, many doctors around the country no longer accept Medicare. The Times notes that there are already thousands fewer doctors than needed and that the problem will be compounded by the new health law and retiring Baby Boomers.

Massachusetts, where Romneycare served as the prototype for Obamacare, is also suffering a severe shortage of many types of doctors. The Associated Press reports that seven of 18 medical specialties were in critical or severe shortages in 2012. These include shortages of basic specialties such as family medicine, internal medicine and general surgery. Predictably, this means that patients in Massachusetts have long wait times. According to Boston.com, only half of Massachusetts primary care physicians are accepting new patients. Once a patient finally locates a doctor who will see them, the average wait is 45 days for an appointment. In spite of the subsidies in place under the law, half of the respondents still say that affordability is still the most important health care issue.

The problems with government controlled health care are not limited to Medicare and Romneycare. As Examiner reported last year, shortages of health care are common in countries where health care is run by the government. In Canada, the Montreal Gazette reported in 2012 that wait times for cervical, breast and ovarian cancer surgery is three times longer than government bench marks. This is a death sentence for many cancer patients. In England, the Independent reported in 2011 that the National Health Service is openly rationing many types of health care. In 2008, the Daily Mail described how patients were left in ambulances for up to five hours so that hospitals could meet government targets for timely care. One of the most horrifying examples of government health care run amok comes from the Netherlands where CNN reported in 2004 that health officials were working with doctors to create guidelines to kill people with “no free will” including children, the mentally retarded and people in comas. In 2012, Wesley Smith, senior fellow of the Discovery Institute, estimated in the Daily Caller that as many as six percent of Dutch deaths involving end of life career involved doctors intentionally killing their patients.

Around the world, government control of health care costs lives when people are unable to get the medical care that they need in a timely manner. It seems that no government and no commodity, whether it is health care or guns, is immune to the economic laws of supply and demand.

Originally published on Examiner:
http://www.examiner.com/article/gun-shortage-shows-future-of-health-care-under-obamacare?cid=db_articles

Ga. gov. rejects Obamacare exchange

Gov. Nathan Deal announced today that Georgia will not set up a state health insurance exchange as mandated by the Affordable Care Act. The governor cited unknown costs, lack of flexibility, and lack of state control in his decision to reject the exchange. The Supreme Court ruled last June that the federal government could not compel states to create the exchanges or expand Medicaid as the Affordable Care Act attempts to do.

Michael Cannon of the Cato Institute notes that there are many incentives for states not to create the exchanges. Cannon says that while exchanges are created by the states, they would be controlled by the federal government. The exchanges would compete with private insurers and would likely drive many out of business. Although the law allows the federal government to implement exchanges for states that refuse, Cannon says that congress did not appropriate any funds for federal exchanges. This makes their implementation in a divided congress unlikely. Cannon argues that since federal insurance subsidies are offered through state exchanges, if all states rejected the exchanges it would reduce the federal deficit by $700 billion over ten years.

Cannon also says that rejecting the exchanges would be good for the states because “defaulting to a federal exchange exempts a state's employers from the employer mandate — a tax of $2,000 per worker per year” on companies with more than 59 employees. He notes that avoiding the mandate tax would create an environment that would attract more businesses to the state.

The Affordable Care Act’s costs for businesses were illustrated last month when the Orlando Sentinel reported that Darden Restaurants, the operator of Olive Garden, Red Lobster, and Longhorn restaurants, was testing a system of not offering full-time schedules to its employees in several restaurants. Darden, one of the nation’s 30 largest employers, said that its goal was to limit part-time employees to 28 hours per week. Under the Affordable Care Act, employers must provide insurance to employees who work more than 30 hours per week.

Deal rejected the one-size-fits-all nature of the exchanges in a press release. “We have no interest in spending our tax dollars on an exchange that is state-based in name only,” he said. “I would support a free market-based approach that could serve as a useful tool for Georgia’s small businesses, but federal guidelines forbid that. Instead, restrictions on what the exchanges can and can’t offer render meaningless the suggestion that Georgia could tailor an exchange that best fits the unique needs of its population.”

Deal said “I remain committed to common sense health care solutions that empower consumers to take responsibility for their own health, motivate the private sector and drive efficiencies for consumers, employers and governments alike. I continue to hope that we might finally engage in a serious conversation about restoring meaningful flexibility to states around health care programs.”

Other states also announced that they would not form exchanges today as well. According to The Hill, governors John Kasich of Ohio and Scott Walker of Wisconsin both formally announced that they would not comply with the federal mandate.

According to the Center for Budget and Policy Priorities, as of Nov. 9 only 14 states had enacted exchange laws. Another five states had legislation pending. Seven states, not counting Georgia, Ohio, and Wisconsin, had formally declined to form state exchanges.

According to Rasmussen, the Affordable Care Act remains unpopular almost three years after its passage. The most recent survey, taken on Nov. 4, showed 50 percent of Americans still favored repeal. A Kaiser Foundation poll from October showed that only 38 percent held a favorable view of the law.

Originally published on Examiner.com

http://www.examiner.com/article/ga-governor-rejects-state-health-insurance-exchange?cid=db_articles