Obamacare will Double Insurance Premiums in California

Posted by PITHOCRATES - June 2nd, 2013

Week in Review

The proponents of Obamacare say it will lower the cost of health insurance, give health insurance to the poor who can’t afford it and cover people with preexisting conditions.  That is, we’ll get more for less.  In all of recorded history there have been few examples of getting more for less.  Usually you have to go to scripture to find them.  Such as when Jesus fed about 4,000 people with 5 loaves of bread and two fish.  This is what the proponents of Obamacare believe Obamacare will do.  A miracle.  Even though a great many of them don’t even believe in Jesus Christ.  Or miracles.  And for Obamacare to do all that they say it will do will take a miracle or two (see Rate Shock: In California, Obamacare To Increase Individual Health Insurance Premiums By 64-146% by Avik Roy posted 5/30/2013 on Forbes).

Last week, the state of California claimed that its version of Obamacare’s health insurance exchange would actually reduce premiums. “These rates are way below the worst-case gloom-and-doom scenarios we have heard,” boasted Peter Lee, executive director of the California exchange. But the data that Lee released tells a different story: Obamacare, in fact, will increase individual-market premiums in California by as much as 146 percent…

That Obamacare more than doubles insurance premiums for many Californians is especially ironic, given the political posturing of the President and his administration in 2010. In February of that year, Anthem Blue Cross announced that some groups (but not the majority) would face premium increases of as much as 39 percent. The White House and its allies in the blogosphere, cynically, claimed that these increases were due to greedy profiteering by the insurers, instead of changes in the underlying costs of the insured population.

Soon after, WellPoint announced that, in fact, because of lower revenues and higher spending on patient care, the company earned 11 percent less in 2010 than it did in 2009. So much for greedy profiteering.

This is no surprise.  Because you can’t just give health insurance to those who don’t have it without someone paying for it.  And you just can’t let people who don’t have health insurance buy a policy when they come down with a costly medical condition without someone paying for it.  Before Obamacare these people didn’t have health insurance.  After Obamacare these people will.  But someone has to pay for it.  And guess who that will be?  Those who pay for health insurance.  Who will now have to pay more as more people will be consuming health care benefits without paying for it themselves.

This is no mystery.  And most people seem to understand this when it comes to income taxes.  As they will vote to raise taxes on rich people so the government can afford to give them more free stuff.  People understand this.  They say the rich should pay their fair share so those who don’t can get stuff for free.  They understand the principle that for some people to get something for free other people have to pay for it.  When it comes to taxes, at least.  But somehow they act surprised when the very same thing happens in health care.

Allowing people with a preexisting condition who didn’t bother to pay for health insurance to buy a policy at the same price as everyone else is unfair.  Because when they were healthy they did not contribute to the health care system by paying an insurance premium.  But now that they are sick they expect others to chip in and help pay their medical expenses when they refused to do it when they had a chance.  And with no annual or lifetime limit to benefits those other people will have to pay even more.  This is what Obamacare will do.  So it was never going to lower the cost of health care.  Because you can’t get more for less.  Unless you’re Jesus Christ.  So, yes, prices will soar for the responsible people who pay for health insurance.

As the Obama administration tries to change the United States into a social democracy like all those European states suffering debt crises and recessions there will be a strong incentive NOT to do well.  For those who do well and prosper get rewarded by paying the bill for those who do not.  From those according to ability to those according to need.  It sounds so utopian.  But what happens in socialist countries is that people try to show as little ability as possible while showing as much need as they can.  Because that’s how you prosper under socialism.  Have other people work hard while you enjoy the fruit of all their labors.  And never show ability.  Because if you do you will only work harder than the guy that doesn’t.



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