Free Markets, Free People
In this podcast, Bruce, Michael, and Dale discuss whether President Obama’s “Jimmy Carter Moment” is approacjing as a result of the BP Oil spill, and his proposal to eliminate the mortgage interest rate deduction.
The direct link to the podcast can be found here.
The intro and outro music is Vena Cava by 50 Foot Wave, and is available for free download here.
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The oil spill and leadership – this isn’t about the gusher anymore, at least as far as the federal response goes.
Ethics – Congress is ready to throw them over again.
Mortgage deduction – keep it or pitch it?
Because internal White House documents estimate that 51% of employers are likely to have to give up their current health care coverage due to ObamaCare. And that’s the conservative estimate. Worst case, the percentage goes to 69% of all employers and 80% of smaller firms.
Why? Well, ObamaCare states that existing insurance plans will be “granfathered in” (i.e. you can “keep your plan”) if they meet certain criteria. Main among them is employers may not make any changes to their existing insurance plan after March 23rd of this year until the ObamaCare implementation of this provision on Jan. 1st, 2014. Those changes an employer might make that would bar it from being grandfathered in include:
• It eliminates benefits related to diagnosis or treatment of a particular condition.
• It increases the percentage of a cost-sharing requirement (such as co-insurance) above its level as of March 23, 2010.
• It increases the fixed amount of cost-sharing such as deductibles or out-of-pocket limits by a total percentage measured from March 23, 2010, that is more than the sum of medical inflation plus 15 percentage points.
• It increases co-payments from March 23, 2010, by an amount that is the greater of: medical inflation plus 15 percentage points or medical inflation plus $5.
• The employer’s share of the premium decreases more than 5 percentage points below what the share was on March 23, 2010.
Most of us who have and have had insurance for any amount of time know that those are fairly routine changes driven by cost increases, benefit changes, and the like. However, any of those puts the plan outside the “grandfathered” status and the ObamaCare law requires the firm to either adopot a new plan or drop coverage and pay a penalty.
How likely is it employers won’t make those sorts of changes in the next 3 years? Not very:
Analyzing data on employer-provided plans from 2008 and 2009, the report stated: “Many employers who made changes between 2008 and 2009 that would have caused them to relinquish grandfather status did so based on exceeding one of the cost-sharing limits.”
In total, 66% of small businesses and 47% of large businesses made a change in their health care plans last year that would have forfeited their grandfathered status.
. Essentially government has taken away the ability of employers to manage their plans and will, by force of law, force any of them that do so within the criteria above to drop that plan for another or drop coverage altogether and pay a penalty.
The document in which this information was found is a draft HHS, Labor and IRS joint study of the impact of the bill. When asked about it, a White House spokesman said:
“This is a draft document, and we will be releasing the final regulation when it is complete. The president made a promise to the American people that if they liked their health care plan, they can keep it. The regulation, when finalized, will uphold that promise.”
That, of course, is the official talking point position, aka spin, or if you prefer, smoke and mirrors. The same official then conceded:
“It is difficult to predict how plans and employers will behave in the coming years, but if plans make changes that negatively impact consumers, then they will lose their grandfather status.”
That is the unspun or “it’s exactly as you said it” version. And of course the government will waste no time blaming the loss of the insurance “you like” on your employer.
Because, as we’ve witnessed for 16 months – that’s what this administration does best – blame-shifting. Simple fact: no law, no loss of the “insurance you like”.
End of story.