Wednesday, January 15, 2014

What You Were Never Told About Obamacare

By Joseph Salerno

While the costs of providing health care insurance are beginning to skyrocket because of Obamacare, insurance company executives are sleeping very soundly. A respected consultant to health insurance companies, Robert Laszewski, reveals that there are two obscure provisions in Obamacare that guarantee that insurance companies will be subsidized and bailed out by Amercian taxpayers. Indeed the Congressional Budget Office estimates that $1.071 trillion will be coercively transferred from taxpayers to big insurance companies over the next decade.

This massive redistribution of wealth will take place via two programs stealthily embedded in the Affordable Health Care Act. The first is the Reinsurance Program under which large claims are capped for insurers offering individual plans under Obamacare. Insurers pay for claims up to $45,000, while the Federal government picks up 80% of the costs exceeding $45,000 up to a maximum of $250,000. This means that Obamacare is a public-private insurance scheme and that we are already half-way to the “single-payer” insurance program that Obama and his left-wing cronies so keenly pine for. Needless to say, neither President Obama nor the establishment media have publicized this provision of Obamacare.

Obama and his media supporters have also scrupulously avoided public references to the Risk Corridor Program that limits total losses for insurance companies via a complex formula. Basically, under this provision, taxpayers would be on the hook for 75%-80% of an insurance company’s losses. The enormous taxpayer-funded subsidization of costs and socialization of losses will make Obamacare more palatable to insurance companies and the public at least for a while, since insurance companies will not need to raise their premiums as much as they would have if they were forced to bear the full burden of cost increases and the risk of huge losses. This may give this destructive program time to take root and wreak havoc with what quality remains in the American health care system. Should Obamacare become permanent, Americans as taxpayers and as consumers of medical services will spend many sleepless nights worrying about how they will pay their tax bills and where they will find quality medical care.

The above originally appeared at Mises.org.

10 comments:

  1. One reason I can not stand being around Tea Party members is their insistence that Obamacare is a communist plot, they have no clue that the AHCA is a public-private partnership. These partnerships are the epitome of fascism, and have been increasing forced upon us by Democrats and Republicans alike.

    We are so screwed!

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    1. In other words, you choose your friends based on terminological-semantic games. And you wonder why the public doesn't know or care about this stuff.

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    2. Indeed, Tea Partiers are dolts.

      Still, does Obamacare have a basic structure that could be morphed into single payer? Even if not, if Salerno's explanation is accurate, Obamacare could be tweaked so that insurers pay claims up to, say, $31,000, while the Federal government picks up, oh, 89% of the costs exceeding $31,000 up to a maximum of $585,000.

      Let us not neglect the bleeding hearts' faith in government to provide goods and services. So I predict that we'll hear more about a desire for single provider healthcare once they make more progress toward single payer. After all, private insurers and private health care providers will be making a killing while the government racks up enormous expenses. Of course, the leftists will say that this is evidence of market failure.

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  2. With each passing day I want to leave the USSA more and more....

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  3. Man, it just keeps getting better and better.

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  4. 1. Force everyone to become customers of big "insurance" companies.
    2. Dump any losses incurred by these same big "insurance" companies onto taxpayers.

    Huh. It's almost as if hacks in the big "insurance" companies wrote this legislative turd themselves!

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    1. They did. Do you think Congress wrote this up on their own?

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    2. No doubt as birds of a feather band together....As the saying goes

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  5. Pay 80% of medical costs above $45.000, wait for constant inflation (plus help it a little by not paying as much to banks to keep reserves inactive), voila, decent amounts of inflation and a system that is 80% socialized already, just the last 20% to kill, should be no biggie.

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  6. Is it possible that The Affordable Health Care Act was never designed to be affordable? Is there more to this story... aka Smart-chip... aka 666, The Mark of the Beast? Was the 3rd Reich a trial run, and the 4th has now begun?; http://www.focusonrecovery.net/hijackofamerica/Bohemiangrove.html

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