Free Markets, Free People

Shocking news: ObamaCare will increase the nation’s health care costs

Yes, yes, I know – it comes as a complete surprise.  No question, we all thought having more covered by insurance, no pre-existing conditions, no caps on payouts and lower premium costs – all the while run by our efficient government – would surely lower costs.  It’s just logical, right?

President Obama’s health care overhaul law will increase the nation’s health care tab instead of bringing costs down, government economic forecasters concluded Thursday in a sobering assessment of the sweeping legislation.

You know, you want to laugh at this because most people who gave up on moon ponies and unicorns when they were 8 knew that what was promised by this bill wasn’t possible.  But it is hard to laugh at this level of mendacity.  Isn’t it interesting that now suddenly the truth begins to filter out – after the fact, of course.

USA Today, in true sycophantic fashion, tries to lessen the blow to the administration by calling it a mixed verdict. It also notes it is the first look at the legislation by “neutral experts”. That’s because it was so important to rush this bill through without giving anyone time to read or analyze it – you know, so the benefits could kick in … in 2014.

And what do these experts find? Well it is less than a “mixed verdict”. As I read it, it’s an outright condemnation of the law.

[T]he analysis also found that the law falls short of the president’s twin goal of controlling runaway costs. It also warned that Medicare cuts may be unrealistic and unsustainable, driving about 15% of hospitals into the red and “possibly jeopardizing access” to care for seniors.

Translation: this goes to the central political point about the bill. Who among the politicians in DC are going to be willing to take on the necessary cuts to Medicare promised by the bill (to “pay” for it) and alienate one of the most powerful demographic election blocs?

The Medicare actuary says no one.

The report acknowledged that some of the cost-control measures in the bill — Medicare cuts, a tax on high-cost insurance and a commission to seek ongoing Medicare savings — could help reduce the rate of cost increases beyond 2020. But it held out little hope for progress in the first decade.

“During 2010-2019, however, these effects would be outweighed by the increased costs associated with the expansions of health insurance coverage,” wrote Richard S. Foster, Medicare’s chief actuary. “Also, the longer-term viability of the Medicare … reductions is doubtful.”

Of course they are, and anyone but the moon pony crowd knew that going in. It’s like the promise of eliminating “waste, fraud and abuse”. If there was any appetite or ability to do that, don’t you think the estimated $60 billion a year in Meidcare waste, fraud and abuse would have been eliminated by now?

And what if they did make the cuts?  Anyone, what is the likely reaction of health care providers?  Uh, “we don’t take Medicare/Medicaid patients anymore”? That is exactly what will happen.  That means those with government insurance coverage won’t be able to find access (unless that too is eventually mandated). 

A separate Congressional Budget Office analysis, also released Thursday, estimated that 4 million households would be hit with tax penalties under the law for failing to get insurance.

The U.S. spends $2.5 trillion a year on health care, far more per person than any other developed nation, and for results that aren’t clearly better when compared to more frugal countries. At the outset of the health care debate last year, Obama held out the hope that by bending the cost curve down, the U.S. could cover all its citizens for about what the nation would spend absent any reforms.

The report found that the president’s law missed the mark, although not by much. The overhaul will increase national health care spending by $311 billion from 2010-2019, or nine-tenths of 1%. To put that in perspective, total health care spending during the decade is estimated to surpass $35 trillion.

The administration doesn’t even argue the point, claiming that’s a bargain for insuring 95% of the country. Of course, what USA Today doesn’t point out is that 75% of the 4 million households that will be hit with those tax penalties average less than $60,000 a year individually and families making less than $120,000 a year.

Also keep in mind that the CBO analysis and estimate are based in the assumption that absolutely everything in the bill goes as planned – to include the Medicare cuts. Or said another way, the $311 billion “cost’ is a joke and it will most likely cost far more than that.

The CBO also looks at Medicare:

In addition to flagging the cuts to hospitals, nursing homes and other providers as potentially unsustainable, it projected that reductions in payments to private Medicare Advantage plans would trigger an exodus from the popular program. Enrollment would plummet by about 50%, as the plans reduce extra
benefits that they currently offer. Seniors leaving the private plans would still have health insurance under traditional Medicare, but many might face higher out-of-pocket costs.

That brings us back to the politics and the polite word used -‘unsustainable’ – to mean the cuts just aren’t going to happen.

USA Today ends its article with this:

In another flashing yellow light, the report warned that a new voluntary long-term care insurance program created under the law faces “a very serious risk” of insolvency.

What they’re talking about is this:

One other interesting note from this study was a paragraph on the new Community Living Assistance Services and Supports insurance program for home care, known as the CLASS Act.

While it produces a $38 billion net savings through 2019, that’s mainly because you have to pay five years of premiums before you can start taking advantage of the program.

After that, the Medicare Actuary doesn’t like the way it looks in financial terms.

“Over the longer term, expenditures would exceed premium receipts, and there is a very serious risk that the program would become unsustainable as a result,” the study says.

“Unsustainable” – pay 5 years of premiums before you get the first benefit and the “expenditures would eventually exceed premium receipts”. Sounds exactly like every other program I’ve seen designed and engineered by politicians. That’s why we’re in the freakin’ fiscal mess we’re in now.

And the moon pony crowd keeps believing you can get something for nothing and that we can fix crap like this to where it will actually work and cost less too.

Repeal it.

~McQ

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24 Responses to Shocking news: ObamaCare will increase the nation’s health care costs

  • Like everything else this regime has foisted upon us, there are two groups of people who couldn’t be more pleased:
     
    1) Those 50% of Americans who do not pay taxes and therefore rightfully conclude: “who cares what the taxpaying schmucks have to shell-out, it’s all free to me”
     
    2) Government employees (read unions) whose jobs were created to service the bureaucratic monster that now demands to be fed.
     
    Hoax and Chains:
     
    Just think it’s only been 459 days!
    Just imagine how much more damage can be accomplished in the next 1,001 days…

  • Well, after all, healthcare is a right. We refined pragmatic moderate academics at cow colleges teaching colleges all know that. Even though we are not nearly as far left as those guys at the Ivy League places, who are out of touch really, compared to us and I don’t envy them all.

    Anyway, healthcare is a right, and we wise leftists have all come together in a consensus on that. Obama with his Christlike visage got it passed. So let’s just stop arguing about it and stop all this nonsense about repeal. Nope, it’s decided, and the job of your grunt engineer types now is to figure out how to make it all work. {chuckle}

    We wise leftists have done the hard part and committed society to providing high-quality healthcare to everyone, regardless of income, pre-existing conditions, hypochondria, risky lifestyle choices, or anything else. Furthermore, we have decreed that it will cost less than healthcare does today. How could it be otherwise? We’ve gotten all the profit-mongering out of it, so there’s a whole lot of extra money now that used to go to profit. So you grunt engineers just need to figure out the details on how to allocate the money and provide the care and the buildings and the doctors and all. Hey, how hard could it be? We’ve given you until 2014! That should be plenty of time. LOL.

    Of course, I believed this whole thing should be handled at the state level, but that didn’t stop me from being a total shill an enthusiastic supporter of Obamacare. And that’s not either a contradiction or lack of principles or shallow thinking or anything like that. It just means I’m a good, well-intentioned leftist who gives up my own preferences for the good of the group. You dense righties could learn a valuable lesson from that, since you stubbornly refuse to give up your preferance to run your own life, and that causes we wise, well-intentioned leftists all kinds of trouble.

    But you thick righties just can’t stop whining about the healthcare bill, so I have to come here and educate you about how it can’t possibly be repealed. Don’t be surprised if this helps Democrats in the fall. Don’t be surprised if I use the phrases “don’t be surprised” and “I suspect” a whole lot this summer, since I can’t possibly admit that the Democrats might get steamrollered this fall, but I’m afraid it might happen, so I have to use those phrases to give me an out.

    I certainly don’t come here to bolster my own sense of self-worth by talking down to you guys. Nope. Stop saying that. I’m just having fun, coming here and arguing and making people so mad that they insult me all the time. {giggle} And don’t start up with how it’s mentally sick for me to get pleasure by irritating other people! It’s not! {eyes rolling}

    Besides, your insults prove that you secretly think I’m right. See, there are really three possible responses to my wise analysis.

    You could just agree with me. That’s what my students just about always do. Of course, if they don’t, I’ll still give them a good grade if their position is well-reasoned. And the fact that I’ve never admitted that anyone on this site has ever had a well-reasoned disagreement with me is completely beside the point, and I don’t know why you bring it up.

    Or you could disagree, like I said above, and we could go back and forth a thousand times, with you erroneously believing that you’ve found a flaw in my position, and me using my godlike powers of political science to handwave away your objections. Heck sometimes I even provide links to support my objections. Sure, they’re all back to my blog, which I don’t either pimp for, but you still have to take them as complete refutation of whatever they need to refute. I decree it. You don’t need any other links. I decree that too. We could just go back and forth, back and forth, and I would never get tired of that, and I don’t understand why some of the people here find it tiresome. Probably because they just can’t stand being shown how wrong they are all the time.

    Or you could insult me, which as I said before, proves I’m right. It also gives me a golden opportunity to use the phrase “you doth protest too much” a whole lot. {eyes rolling}

    So, to summarize, no matter which of these options you take, in the end I’m proven right. And since I have advanced degrees and a published book on foreign policy, that’s as it should be.

    Because I am indeed always right. And you guys who accuse me of lying by throwing my own words from the past up in my face just don’t understand post-modern thinking. Though I don’t buy postmodernism, as I’ve explained. And even though I do believe it’s valid, as I’ve also explained. And there’s no contradiction in that, and I’m not lying either time. I decree it. Stop laughing!

  • It won’t be repealed, but it will be altered and probably expanded.   The dramatic rise in health care and insurance costs without reform would be even more damaging.    Republicans can play a role if they come to the table and talk about ways to make reform work better.  If they continue to be obstructionist, and naively believe the tiny tea party speaks for most Americans, then they will find themselves out maneuvered and impotent.    The fact is that the current economic crisis proves that the myth of the free market is wrong; relying on the market to regulate health care is downright immoral.   It’s even worse than relying on the market to regulate derivatives trade!

    • “Naively believe the tiny tea party speaks”  ….and American blacks were a mere 10% of the total population, yet in 1964 the Civil Rights act happened anyway.
       
      You are sooooo out of touch up there in the faculty break room.  In that icon of yours, is that a side on view of your ‘deer in the headlights’ look.   You might want to practice it now, you’ll need it in November.

    • It won’t be repealed, but it will be altered and probably expanded. Which, of course it needs to be. The dramatic rise in health care and insurance costs without reform would be even more damaging. Because we all know that as soon as government gets involved in something, the costs drop and the quality improves.

      Republicans can play a role if they come to the table and talk about ways to make reform work better. As I’ve said so many times before, if righties will just start by admitting that we’re basically right about the wise leftists needing to set the general direction of society, then we’ll throw you a few bones to make you feel better about it.

      If they continue to be obstructionist, and naively believe the tiny tea party speaks for most Americans, then they will find themselves out maneuvered and impotent. Yes, I decree it. The tea parties don’t mean a thing. I don’t care about what any of the surveys or polls say, and I don’t care about the predictions among political insiders such as Stenn Hoyer that Democrats might lost control. Nyah, nyah, nyah, I have my fingers in my ears, I can’t hear you. All is well.

      The fact is that the current economic crisis proves that the myth of the free market is wrong; relying on the market to regulate health care is downright immoral. See, having wise leftists take over your lives is a moral imperative! I decree it. And don’t start up with how it’s all just an excuse for us to gain more power and influence over you grunt engineer types. It’s not just an excuse because we have morality on our side, and all your bleating about wanting to run your own lives and make your own decisions and spend your own money is immoral. I’ve already explained how you are Nazi-like and now your immorality has completely vindicated my case.

      It’s even worse than relying on the market to regulate derivatives trade! Or relying on the market to do anything about public education! It’s immoral not to have we wise leftists running things, because we have everyone’s best interests in mind, and we never get things wrong, and you people need to stop bringing up how we didn’t have most of these problems before the government got involved in all these areas. Nope, the market only works when the grunt engineer types that participate in it are guided by wise leftists. I decree it.

      So you guys listen to me. I have advanced degrees. Plus I’m having fun telling you guys what you should be thinking. And shut up about how that indicates a mental sickness that I derive pleasure from irritating you dense righties! Why, I’ve been bullied all my life by people like you, and I deserve my fun!

    • I really love the irony of being lectured on morality by a known liar.

    • Lots of anger there… not much independent or original thought.  Your basic premise, that things can only get worse without government intervention, is flawed.
       
      Here’s the deal, the current Health Insurance (not Health Care) system is fatally flawed and has been almost from its inception.  The industry has been in the process of being reformed by market forces b/c costs had become too high.  You saw this with HSA’s and high-deductible plans.  While they are not specifically a best solution, they were moving us back to a system of personally financial accountability  and the long term effect would’ve helped to bring costs back down and rework our nation’s Health Insurance system without also damaging the Health Care system, which is top notch.
       
      What this bill represents is a all-in on a flawed model that will not stop the inevitable collapse, but merely delay and magnify it and likely do significant damage to the Health Care system as well.

      • Scott - The industry has been in the process of being reformed by market forces b/c costs had become too high.  You saw this with HSA’s and high-deductible plans.  While they are not specifically a best solution, they were moving us back to a system of personally financial accountability  and the long term effect would’ve helped to bring costs back down and rework our nation’s Health Insurance system without also damaging the Health Care system, which is top notch. [emphasis mine – dj505]

        An excellent point!

    • but it will be altered and probably expanded
      Why ? It’s perfect.  I suggest that instead of trying to “push a string” that Republicans do everything possible to make it stay in place .. as is.  We never really get a chance to do a complete evaluation of any bill before they alter it to hide the “warts”.  This bill has no “warts” … It’s perfect.

    • Can we flip the record to the “A” side?

      I’m kinda tired of hearing the “B” tune over, and over and over again.

    • It won’t be repealed, but it will be altered and probably expanded.

      I agree, although I think the word “probably” is superfluous.  Congress will not repeal this bill, they will continue to add to it and modify it in the face of fiscal disaster as if they are oblivious to the damage that they’re doing.  The only reason the status quo would be more damaging is because the approach to health insurance is completely insane and not in tune with logic or reality.  In effect, we’re arguing whether it’s better to run off of a cliff wearing shoes or wearing sneakers, as if the choice of footwear has any relevance when we jump to our (economic) death.
       
      Perhaps it’s a fitting way to cap off the whole idiotic charade.  Act as if enacting or defeating health care reform would have made any difference economically after decades of criminal mismanagement of the budget by the government.

    • The fact is that the current economic crisis proves that the myth of the free market is wrong; relying on the market to regulate health care is downright immoral.   It’s even worse than relying on the market to regulate derivatives trade!
       
      How would we know Scott? We have not had a free market in either one for many many decades.  That is the main problem with your belief system. Government comes in and makes a big stink of something, then you point to that as a reason for more government.

  • LOL

    “most people who gave up on moon ponies and unicorns when they were 8″

    Love it. Yeah. The whole thing was a used car salesman pitch from day one, not to denigrate used car salesmen too much. These programs are little more than tools by which the gov is attempting to further feed itself and enslave the classes.

  • McQ - You know, you want to laugh at this because most people who gave up on moon ponies and unicorns when they were 8 knew that what was promised by this bill wasn’t possible.

    “Laugh” isn’t quite the emotional response that I find most appropriate under the circumstances.  “Scream”, while a trifle understated, is closer to the mark.  I also want to get even with the people who’ve done this to me and my country.  Therefore:

    — I propose that anybody who supported this bill be made to have the word “DUMBASS” tattooed to his forehead and also go for a PET scan to see which part of his brain doesn’t work properly.

    — I further propose that any member of MiniTru who supported this bill be made to have the word “LIAR” branded to his forehead AND be tarred and feathered.

    — Finally, I propose that members of Congress be made to go on Medicaid as their sole insurance for the rest of their lives.

    Grrr…

    Much has been made about “bending the cost curve.” First of all, WHOSE cost curve are we talking about?  Second, how does a huge, top-down, federal program bend that curve in any way BUT up???  Health care takeover supporters have always been very careful NOT to clearly answer these questions.

    Much has also been made about the “right” to health care.  I suggest that it IS a right, broadly part of the right to life enshrined in the Declaration of Independence in the same way that one has a right to food, water, shelter, etc.  To my mind, the government’s job is simply to see that people don’t stop you exercizing that right.  It is NOT to force other people to provide it to you.

    Sigh…

    I hope that the American people are learning some valuable lessons here, but I’m skeptical that this is the case.  I’m sure that there are plenty of dimwits who, even if they can be made to believe that ObamaCare is a budget-buster that will bankrupt the country, will STILL believe that the federal government can and SHOULD “fix” health care.

    Who needs barbarians at the gate when you’ve got plenty of morons inside?

  • Well, now that the fish is out of the dark freezer and into the display case more people will be able to get an idea of how badly it stinks.

  • People need to start ignoring what obama says and start paying attention to what he’s doing.  If he had said he would do all the things he done since he’s been in office he would have been branded a traitor and tarred and feathered.  instead people are judging on both his words and his actions which do not match up.

  • So, you may be wondering how Progressives (those few who actually read stuff like this) can sniff and sneer at Conservatives who cite this report much as McQ has done.  They are reading articles like this:
     
     
    http://www.tnr.com/blog/jonathan-chait/conservatives-seize-upon-fails-understand-health-report
     

    “The actuary’s office loathes predicting behavioral changes. It therefore underestimates the private sector’s ability to adapt to new incentives.  This is why the only real savings they score are direct and unambiguous price changes…  They discount and ignore the impact of the Center for Medicare and Medicaid Innovation, which is charged with implementing every reasonable payment reform pilot imaginable, including: accountable care organizations, medical homes, and bundled payments that give clinicians across organizations incentives to coordinate and improve patient care.”
     

    You see the unicorns will save us enough money that everything will work out well.  Why don’t those actuaries (and Conservatives) take the unicorns into consideration?

    • This is cargo cult analysis. They have appropriated terms such as incentives without apparently having much of a grasp about what they mean. In particular, they are using the word “incentive” where the word “threat” would be far more appropriate, since “incentive” generally carries the connotation of a positive encouragement or reward.

      For many healthcare professionals, all the new rules, regulations, caps on payment, etc. are not an incentive to improve patient care. To the degree that they are an incentive, it’  an incentive to get out of the field.

      If a certain critical mass of them do that, it will start a vicious circle, as the shortages put more pressure on those remaining, causing them to throw up their hands and leave too.

      In the leftist mind, “incentive” apparently means “forcing people by our rules and threats to make society into the wonderful place we want it to be”. Postmodernist redefinition for convenience in pushing a political agenda strikes again.

    • There’s also a blind side Catch 22 to this that the Chaits of the world never see – if the cuts are made, many, if not most doctors will simply quit seeing medicare and medicaid patients.

      • It’s okay for the bill to kill people — just don’t call it a “death panel.”