Over the last year I have been asked on multiple occasions to explain Obamacare. The topic is so dense, so nuanced, that I have never had the time to even try to wrap my head around it. Then suddenly the government shut down and I had plenty of time and no excuses. As has been noted by liberals everywhere, Obamacare is now the law of the land. As much as it pains me to say it, they are right and so we might as well understand what Obamacare is. In one sense you could say that it has taken far too long for me to study this issue, but in a very real sense, there have been so many changes to the bill since 2010 that even heading into the middle of October we are unsure as to what it will look like. That being said, if you want to understand what lies ahead strap on extra oxygen tanks and some dive weights. We are going deep. The first thing to understand is that Obamacare and the Affordable Care Act (ACA) are NOT the same thing. Now, admittedly, many a person has been mocked for making such a claim. I get mocked all the time and truly enjoy watching people use their God given imagination to come up with new ways to do it, so I don’t mind. Jimmy Kimmel had a hysterical bit the other night asking people which they prefer. Now, I am aware that legislatively they are the same but I would argue, and win, that the two are distinctly different. Here is what I mean: The ACA was passed into law by the President and Democrats in 2010. That law bears vague resemblance to what went into effect a few days ago. Using expansive executive authorities Obama has decided to delay some portions of the law and selectively enforce others. The most obvious example of this is that the “Employer Mandate”, a major portion of the bill passed in 2010, has been pushed back until after the next election. What is more is that massive waivers have been issued to some and denied to others, all at the will of the executive branch. Most notably the waivers have been granted to those who most fiercely advocate for the ACA. The ACA passed in 2010 looked very different than what we see today. What we see now is a law that was passed and then subsequently molded in the image of its author. It has taken on waivers, kickbacks, and hush money to become Obamacare: something wholly different than what was passed in 2010. Now as to our current realities: Regardless of how we feel about Obamacare we are all going to have to deal with it. So what does it look like? If you have employer provided healthcare then you have nothing to worry about…yet. Basically there are three options. First, if you have employer provided healthcare it will not be immediately affected and so you have little to worry about, so long as you die before the end of the year, more on that later. Second, if you do not have employer provided healthcare you may now go and register for it at one of the exchanges, which are conducted on a state by state basis. If this is where you find yourself you will be given a substandard, government mandated plan which very well may be better than what you had before, but do not confuse this option with being on par with the third option. The third option is that you go out on the open market buy one that suits your needs. Now none of this sounds bad until we start looking at the details. The Financial Aspects The true problems begin January 1, 2014. It is on this date that insurance companies are forced to start accepting everyone regardless of preexisting conditions. Now it does not require intellectual gymnastics to realize that if your insurance providers are forced to start making massive payments for people that have no ability to pay them back, such as the terminally or chronically ill, then they are left with two options. They can either pass that expense along to you by raising your premiums or they can close down their business. What is more is that Obamacare, by introducing the government subsidized and regulated exchanges, has introduced a false competitor to the marketplace. In addition to needing to raise the premiums, they are now forced to compete for business with sub standard (using the standard currently out there) government plans. This means that many employers, and we already see this happening, will drop healthcare coverage for family members thus forcing them to the exchanges. What this means in real terms is that there will be fewer people to buy the already more expensive insurance plans, driving the price up even further. As the price continues to rise fewer and fewer people will be able to afford the plan dictating that insurance companies will be forced to either continue to raise prices, reduce coverage, or some combination thereof. I would say that this is an endless cycle but it is not. Every time you go through the cycle you are left with less than you had before. What you have is a genuine self-licking ice cream cone. Nobody really enjoys it and it is in a constant state of melt until it simply is no more. As Milton Freidman said back in the 1970’s, any attempt at nationalized healthcare is simply a gateway to socialized medicine and making the physician an agent of the state. The government cannot force companies to stay in business on their own. Of course, as we have seen throughout the last two presidencies the government can pour untold billions into failed business ventures to keep them afloat for politically expedient reasons, but at some point the private sector is moved from the driver seat to the back seat and eventually is thrown from the car on a sharp curve. As the Obamacare ice cream continues to melt, meaning it is no longer profitable for insurance companies to stay in the insurance business, they will leave. This may sound farfetched to some but right up until the law was enacted there was a mild, underreported panic in the administration because no insurance company thought it could turn a profit in 36 different counties in the state of Mississippi. People there were deemed too poor and too unhealthy to cover and make a profit under the new rules. With the regulation and requirements on insurance companies it simply made more business sense to cut all ties and take business elsewhere. It was at the last minute that the Insurance carrier Humana decided that they would give it a shot for one year. They decided to do this because they realized that they would have no competition and could alter plans dramatically without having to worry about competition beating them out. This leads to another dramatic loss brought on by Obamacare: Monopolies. Liberals are always saying that they are fighting for the little man but this bill hoses every man. The government has created an environment in which only the extremely wealthy are going to be able to afford quality healthcare and only the extremely wealthy and politically connected companies are going to be able to stay in business. As the prices increase, the smaller companies will die off first but the cycle will get them all eventually. Left unchanged Obamacare is a one way ticket to a single payer (AND THAT SINGLE PAYER IS YOU) system. It may not happen next year or even in the next five years but make no mistake, it will happen. The Medical Aspect If you are lucky you grew up with a family doctor. Someone that you trust and who treats you right. They surround themselves with good people and take their time getting to know you and/or your children. This is certainly not the case for everyone, or even the majority. Let’s call it the medical ideal. This ideal is not gone but the sun is setting. We have already discussed the slow death of the insurance companies. Any close personal relationships with your physician will experience this same slow death. There are a few reasons for this and none of them have anything to do with the physicians. By so heavily regulating the insurance industry, the profit margins of medical practice are greatly reduced. Those small family practice doctors are going to have to spend less time with more patients in order to meet their profit margins. It may not be what they want to do but simply what they have to do to make ends meet. What is more is that as time progresses you will see fewer and fewer specialists. This is due in part to the idea that few people go through medical school so that they can work for the government. As it becomes more apparent that that is where the medical field is headed, fewer will move in that direction. This is also due to the reduced profit margins of the medical field. Because of the reduced profits fewer people will enter the medical field. Of those few, most will see that specializing in a specific field simply does not make good financial sense. Take for example a brain surgeon. After leaving medical school they take on years of additional training and the heavy debt that goes with it. They have historically done this because they know that they will be able to pay that debt off quickly once they enter into their chosen specialty. Heavily regulated insurance and the loss of profits means that those debts will stay with them much longer than they currently do. Many will make the smart financial choice not to specialize at all and the national standard of care will suffer for it. The Bottom Line In running through this quickly I have not even touched on the additional taxes, laws, privacy concerns, and many other problems. There are a myriad of massive issues with this program and it will reshape our way of living, the way we interact with our employers, and the means and depth with which we interact with our government. Now there are no doubt people who have discarded everything that I have said up to now because they feel the issue is a moral one. They feel that Obamacare fulfills a moral obligation. To them I would first say this: You receive no credit towards achieving your moral obligations by forcing the rest of us to pay for it. If you want to help the poor, do it. Do not sub contract it out to the government. Secondly I would say that we are called to care for the widows and orphans and the best way of doing that is to be good, generous stewards of what we have. If the kindness and grace in your heart prompts you to give your paycheck to the poor that is great and should be honored. If, however, your house is foreclosed on next month because you gave away your paycheck rather than paying the bills you had duly incurred, then you are a kind hearted fool who cheats others out of the money you owe them. Moral obligations do not exempt you from math. Regardless of how strongly you feel about something, the realities of it do not change. You have to take in more than you pay out. You have to live within your means. It has to happen in your personal life just as it must on a national scale. In short: A rough road is ahead. Surround yourself with good people. People that make you smarter and better. Come to your feet. We got work to do.
Posted on: Sat, 12 Oct 2013 02:57:01 +0000
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