Free Markets, Free People


More real ObamaCare costs emerge

I don’t want this one to slip by, because it is significant. It is yet another study that shows the numbers attributed to the cost of ObamaCare were so much nonsense. The interesting thing is it comes from an organization friendly to ObamaCare (via HotAir):

Families USA commissioned The Lewin Group to use its economic models to estimate how many individuals would benefit from the new premium tax credits in 2014 and the value of the dollars going to help pay for insurance (see the Methodology on page 12 for more details). We found that an estimated 28.6 million Americans will be eligible for the tax credits in 2014, and that the total value of the tax credits that year will be $110.1 billion.

Where’s the disconnect? Well the Congressional/CBO estimate for this particular cost was almost 600% lower than the Lewin Group study. Ed Morrissey lays it out:

In his presentation to Congress, CBO director Douglas Elmendorf predicted a cost of only $20 billion on health-exchange subsidies and associated costs.  The Lewin Group, which conducted the study for Families USA, shows that four times as many people will become eligible for subsidies in 2014 than the CBO predicted in March and that the cost will be 550% higher as a result (page 4 of the linked study).

How did the CBO arrive at those numbers with which to calculate the cost of ObamaCare?  Well when Morgen at Verum Serum pointed out the discrepancy to Families USA, they had a peculiar answer:

Morgen also contacted Families USA to get an explanation of the difference, and was told that he made an “apples to oranges” comparison.  Why?  This survey, they explained, showed how many people would be eligible, while the CBO predicted how many people would actually take advantage of their eligibility for tax credits.  This is an odd distinction to make, since the entire idea of the subsidies is to encourage uninsured Americans to buy health insurance through both mandates and generous subsidies.

Morrissey asks:

How likely will it be that people will pass on the notion of getting big tax credits to subsidize must-issue health insurance?  And if the success rate in applying mandates, higher taxes, and more government authority to the 270 million Americans who are already insured is only 20-25% in getting the other 30 million insured, how is that at all successful?

The deficit projection given by Democrats was apparently based on 75% failure rates to get people into the system; their advocates are busy touting the massive amounts of subsidies in the program that will tip ObamaCare into a deficit exploder in Year 2.

75% failure rates?  In other words, 75% of those eligible for a generous subsidy through tax credits won’t take advantage of them? 

Really?  I guess this is one of those “benefits” Bill Clinton was talking about that hasn’t quite made an impression yet – exploding costs well above the nonsense the Democrats used to “justify” the abysmal ObamaCare bill.

Talk about being sold a pig in a poke.

~McQ

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6 Responses to More real ObamaCare costs emerge

  • This does feed into Bill’s “gap”. The thing is, it says only 30M will benifit. SS and Medicare have been safe from reform because 100% of old people can benifit (and if you are over 30 you have probably been paying for your benifits for at least 10 years). Oh, and old people vote, and tend to be informed.

    My guess is that this 30M will mostly be people who have low voter turnout. This benifit is more like welfare, and Bill should know that programs like that can be reformed.

    Note that I am somewhat contradicting my initial position on this in the last post that covered the “gap”. This is because I haven’t settled on an answer, in large part because the “benifits” of Obamacare are not clear to me. A full “public option” commie care system like NHS has an obvious benifit, not one that’s a net positive but one people won’t want to give up (if only out of fear of the unknown), but Obamacare just seems to be a means of breaking the current insurance system (which is also dysfunctional, just less so). The problem for the Democrats is that few will trust them after passing Obamacare, hence they likely won’t be able to “fix” things with the “public option”. That is how I hope it plays out, at least.

  • 600% lower


    That’s impossible…100% lower would equal zero.  Just saying…

    • Yet, a 600% increase is possible.

      • True, true.  You can, for example, double a number infinitely and the number grows infinitely larger.  You can half a number infinitely, but it is constrained by a limit of zero.  The alternate view is that saying “600% lower” would produce a negative number five times larger than the original number, which is nonsensical when talking about costs…it would turn a cost into a benefit.  I’m just nit-picking though.  My kvetching doesn’t change the value of the great post and the info therein.