The Abysmal Rollout of Obamacare going According to Plan to bring us to National Health Care?

Posted by PITHOCRATES - February 16th, 2014

Week in Review

The roll out of the Affordable Care Act (i.e., Obamacare) has given us a plethora of unintended consequences.  From freezing new hiring.  To pushing full-time workers into part-time.  To people losing the health insurance and doctor they liked and wanted to keep.  To higher insurance premiums. To higher deductibles.  To higher co-pays.  Taking a health care system that the vast majority of people were satisfied with and making it worse.  To accommodate a small percentage of the population who were uninsured.  If that wasn’t bad enough it doesn’t even look like some of the people who signed up for Obamacare are paying their insurance premiums (see Next problem for Obamacare: deadbeat enrollees by Rick Newman posted 2/14/2014 on Yahoo! Finance).

The  New York Times has discovered  that only about 80% of people purchasing health insurance through the federal online marketplace or a similar state-run exchange paid their first month’s premium. There’s no single source of such data, but the Times canvassed insurers participating in the program, such as Aetna (AET), Wellpoint (WLP), Humana (HUM) and Blue Shield of California. All said that the first-month payment rate ranged from 75% to 80% or so, far lower than for typical plans. If enrollees don’t pay the first month’s premium, their insurance never goes into effect.

That doesn’t mean, however, that one-fifth of the people signing up for Obamacare are blatantly refusing to pay. Technical problems with some of the exchange websites may have left people enrolled in an insurance plan without knowing it. Some may never have received a bill or confirmation of their enrollment. Others may have unwittingly signed up for two different policies, while paying for only one.

To make the Affordable Care Act work required a huge health care cost transfer from the old and sick to the young and healthy.  The young and healthy, incidentally, made up a sizeable portion of the uninsured.  Because they were young and healthy and felt invincible.  And invincible people don’t need to buy insurance.  So Obamacare needed the individual mandate to force these people to buy insurance against their will so they could pay for the old and sick.

Of course when they raised the price of health insurance to cover pre-existing conditions it wasn’t the young and healthy that ran to the Obamacare exchanges.  It was the old and sick.  Adding too many old and sick to the insurance pool.  And not enough of the young and healthy.  Those who would pay without consuming any benefits.  Because they are young and healthy.  Causing the insurers to pay more out in benefits than they receive in premiums.  Forcing them to raise their premiums.  Which will, of course, kick off the death spiral as people drop out because they can’t afford those higher rates.  Which will, in turn, force the insurers to raise their rates again.  Hence the death spiral.   And as bad as all of that was now it looks like about 20-25% of those who ‘signed up’ either didn’t or are simply choosing not to pay.  Making the financial predicament of the insurers far worse.

Of course if your plan was to force single-payer (i.e., national health care) onto the people against their will then everything is going according to plan to destroy the private insurance market.  Leaving only the government to step in and provide single-payer (i.e., national health care).  Which should fill everyone with confidence after seeing how well they rolled out the Affordable Care Act.  And no doubt will impress us even more with the rollout of single-payer (i.e., national health care).


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We have Obamacare because Democrats are Better at Lying than Republicans are at Telling the Truth

Posted by PITHOCRATES - October 24th, 2013

Politics 101

President Obama Habitually breaks Every Promise he makes and Suffers no Consequences

President Obama made a promise to Americans as he stumped for the Affordable Care Act (aka Obamacare).  He said if you like your insurance plan you can keep your plan.  If you like your doctor you can keep your doctor.  And even those people who did like and want to keep their insurance and doctor would benefit under Obamacare.  Because they would get more for less.  If you do a search on YouTube you can see all sorts of videos where you can hear President Obama make these very promises.  Like this one.

The president was adamant.  He made these promises over and over.  Nothing in his plan would change anything for those happy with what they had.  Period.  He said that a lot.  Period.  These weren’t mere political promises that we expect to be broken as usual.  This was a solemn oath from President Obama.  And we could take that to the bank.  Well, it turns out the American people couldn’t take that to the bank.  For he broke every promise he made.

George Herbert Walker Bush became a one-term president because he said, “Read my lips.  No new taxes.”  And then he made a deal with devious Democrats to raise taxes in exchange for spending cuts.  Spending cuts that never came.  Bush broke one promise and it ended his political career.  While President Obama habitually breaks every promise he makes and suffers no consequences.  At least not yet.  But that may change.

Hackers will call the Obamacare Database the Mother Lode when it comes to Hacking

The whole point of the Affordable Care Act was to make health care affordable for everyone.  So everyone could have health insurance plans that covered everything.   While paying less than they ever had before for health insurance.  So far, though, that hasn’t been happening.  In fact, fewer people have health insurance since Obamacare was rolled out (see More Americans In 3 States Have Had Their Insurance Canceled Under ObamaCare Than Have Filed An Exchange Account In All 50 by Josh Archambault posted 10/24/2013 on Forbes).

This week the reality of the ObamaCare roll-out appeared in a set of news stories that serve as an ironic juxtaposition. Over 500,000 individuals have seen their insurance policies cancelled in just 3 states.  In all 50 states, only 476,000 applications have been “filed” in an exchange. (Even though we are still learning the true definition of “filed.”)…

As I have tracked enrollment by states, many are reporting out both Medicaid and exchange enrollment at the same time.

Therefore the 476,000 number is misleading. My best guess is that for the 17 states that have reported out some data, the number is closer to 193,818 applications (once you pull out the Medicaid applications that have been reported on). Of course, this number is also still too high as it is compromised by the jointly reported data.

People are losing the insurance they like because to keep it requires more than they can afford.  For Obamacare has made the insurance they liked and wanted to keep much more expensive (see Obamacare deductibles a dose of sticker shock by Peter Frost posted 10/13/2013 on the Chicago Tribune).

Many Illinoisans buying health coverage on their own next year will face a similar dilemma spurred by the health care overhaul: pay higher monthly insurance premiums or run the risk of having to shell out thousands more in deductibles for health care if they get sick.

To promote the Oct. 1 debut of the exchanges, the online marketplaces where consumers can shop and buy insurance, Obama administration and Illinois officials touted the lower-than-expected monthly premiums that would make insurance more affordable for millions of Americans. But a Tribune analysis shows that 21 of the 22 lowest-priced plans offered on the Illinois health insurance exchange for Cook County have annual deductibles of more than $4,000 for an individual and $8,000 for family coverage…

Plans with the least expensive monthly premiums — highlighted by state and federal officials as proof the new law will keep costs low for consumers — have deductibles as high as $6,350 for individuals and $12,700 for families, the highest levels allowed under the law.

And then there’s the website.  In an era where identity theft is running rampant where hackers can steal everything in your smartphone while sipping a coffee at Starbucks we are asked to enter all our personal and identifying information into this website.  And after they collect it they will store it in one massive database.  Or as that hacker in Starbucks would call it, the mother lode.  A hacker’s paradise.  So is our personal and identifying information safe?  It doesn’t matter.  For the government has written in the code that by entering our data we acknowledge that we have no expectation of privacy (see Obamacare Website Source Code: ‘No Reasonable Expectation of Privacy’ by JERYL BIER posted 10/14/2013 on The Weekly Standard).

The launch of federal government’s Obamacare insurance exchange,, has been plagued with delays, errors, and poor website design, even prompting USA Today to call it an “inexcusable mess” and a “nightmare”.  Now comes another example of why the website’s reputation is in tatters.  Buried in the source code of is this sentence that could prove embarrassing: “You have no reasonable expectation of privacy regarding any communication or data transiting or stored on this information system.”  Though not visible to users and obviously not intended as part of the terms and conditions, the language is nevertheless a part of the underlying code for the “Terms & Conditions” page on the site…

The full portion of the code which does not appear on the visible page displayed for users reads as follows:

You have no reasonable expectation of privacy regarding any communication or data transiting or stored on this information system.  At any time, and for any lawful Government purpose, the government may monitor, intercept, and search and seize any communication or data transiting or stored on this information system.  Any communication or data transiting or stored on this information system may be disclosed or used for any lawful Government purpose. [The sentence beginning “To continue” also appears again, but is only visible once on the page as displayed for users.]

Talk about your Big Brother.  Once upon a time the Constitution required a warrant for the government to collect this information.  Now it’s the price of health care.  You want to live?  Then you must sign away your Fourth Amendment Right.

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

Apparently the Obama administration has little regard for the U.S. Constitution.  Funny how these same people railed against George W. Bush and the Patriot Act.  And he was only wire-tapping international telephone calls to suspected terrorists.  Not throwing a dragnet to see what useful information the government could collect on potential political enemies of the state.  Which could be useful in the next election.  Or to silence a critic.

The Taxpayer Bill for the Obamacare Website is $1 Billion and Counting

Proponents of national health care like to say the United States is the only advanced economy without national health care.  But what they don’t say is that those countries they so admire have a mix of public and private.  And those who can choose the private over the public whenever they can.  Australia.  The United Kingdom.  Even Canada.  And the name of the Canadian private network?  The United States.  Well, before Obamacare, at least.  In fact, not only do patients travel across the border for the private American health care system.  So do doctors and nurses.  In search of a decent wage.  For in Canada they have little choice but to accept what the Canadian government pays them.  However little that is.

The lynchpin of Obamacare is getting young, healthy people to buy health insurance policies.  Who will only pay into the system.  For being young and healthy they won’t consume any health care resources.  So the young and healthy can pay for the old and sick.  And with an aging population, the old and sick outnumber the young and healthy.  So the young and healthy will be paying high premiums and high deductibles.  Just as is happening.  While families will pay even more.  And just as they are paying more for their now mandatory health insurance their household incomes are falling.  Employers are pushing full-time workers to part-time.  Laying off workers to have less than 30 on the payroll.  And they’re not hiring anyone to keep from having 30 workers on the payroll.  All because of Obamacare.  So the 10 million or so workers who left the labor force since President Obama assumed office won’t be going back to work any time soon.

So the Affordable Care Act is as bad as the Republicans said it would be.  And then there’s the cost of the website (see Late IT Cash Surge Foreshadowed Health-Law Woes by Peter Gosselin posted 10/24/2013 on Bloomberg Government).

Although the Affordable Care Act has been law for three and a half years, one third of the funds going to the top contractors working on the federal exchanges were awarded in the six months before the new insurance marketplaces opened Oct. 1, a Bloomberg Government Analysis has found. The torrent of late spending — almost $352 million of $1 billion in awards to the top 10 contractors — indicates the magnitude of the work still to be done as opening day approached, and helps explain the information technology problems that have dogged the exchange system since its launch.

$1 billion for a website.  And one that doesn’t work.  Imagine that.  But in the grand scheme of things this will still be the least costly part of the Affordable Care Act.  And we’ll look back to these days as the good old days of Obamacare.  Because it is horrible now.  And it will only get worse.  The Republicans knew this which is why none of them voted for it. The Democrats knew it, too, but they didn’t care.  Because for them Obamacare is not about health care.  It’s about acquiring power.  Sadly, they were able to win this political contest.  Because they are better at lying than the Republicans are at telling the truth.


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More Unions are Angry about the Unintended Consequences of Obamacare

Posted by PITHOCRATES - May 26th, 2013

Week in Review

The unions and President Obama were tight.  Once upon a time.  They helped the president win two elections.  Dumped truckloads of campaign money into his coffers.  And the thanks for all of this?  Obamacare.  Which they once enthusiastically supported.  But now they are learning what the opponents have been saying about Obamacare all along.  That it will make health insurance more expensive.  And likely that people will lose coverage they like and want to keep.  It’s getting so bad that unions are now coming out in opposition of Obamacare (see Some unions now angry about health care overhaul by SAM HANANEL, Associated Press, posted 5/24/2013 on Yahoo! News).

…some unions leaders have grown frustrated and angry about what they say are unexpected consequences of the new law — problems that they say could jeopardize the health benefits offered to millions of their members…

“It makes an untruth out of what the president said, that if you like your insurance, you could keep it,” said Joe Hansen, president of the United Food and Commercial Workers International Union. “That is not going to be true for millions of workers now.”

The problem lies in the unique multiemployer health plans that cover unionized workers in retail, construction, transportation and other industries with seasonal or temporary employment. Known as Taft-Hartley plans, they are jointly administered by unions and smaller employers that pool resources to offer more than 20 million workers and family members continuous coverage, even during times of unemployment.

The people who work in construction may work for many different construction companies throughout their working life.  But they have consistent benefits because of the one constant during their union life.  Their union membership.  Which makes these jobs different than someone working in the same UAW assembly plant all of their life.  Who also work for the same company all their working life.

A lot of people will stay in a job they don’t like because of their health insurance benefit.  Construction workers don’t have to worry about being stuck in a job they don’t like.  If they don’t like an employer they can quit.  Go to the union hall.  And pick up another job.  All without any interruption in their benefits.

Construction companies collectively bargain contracts with these unions.  For example, electrical contractors will negotiate a contract with the local chapter of the union representing electricians.  And health care costs are a big part of those negotiations.  For it is these electrical contractors that pay for the health insurance plans managed by the union.  And it’s costly.  Raising a contractor’s cost when bidding new work.  Which is why union construction companies try to keep nonunion companies from bidding their work.  Because nonunion companies don’t have this massive cost to pay for this generous union benefit.  Which can provide uninterrupted health insurance for an unemployed worker sitting at the hall for months waiting for another job.  As well as for his wife and his children.  Something people don’t enjoy when they get laid off from most other private sector jobs.

The union plans were already more costly to run than traditional single-employer health plans. The Affordable Care Act has added to that cost — for the unions’ and other plans — by requiring health plans to cover dependents up to age 26, eliminate annual or lifetime coverage limits and extend coverage to people with pre-existing conditions.

As it has added to the cost for ALL insurance plans.  There’s a reason why before Obamacare plans didn’t cover dependents up to age 26, had annual or lifetime coverage limits and excluded pre-existing conditions.  Because they add great cost.  Insurance companies aren’t greedy.  They’re just trying to provide insurance.  Having people pay a little bit for a policy to insure against a large financial loss.

For insurance to work you need a lot of responsible people paying a little bit for those policies.  Forcing plans to cover pre-existing conditions, though, makes people NOT buy health insurance.  For they think why should I pay years of health insurance premiums when I can just buy a policy when I’m sick?  Which they will.  So they will consume a lot of health care costs that have to be paid by people who are buying policies.  While contributing nothing to the pot for others.  Making those policies under Obamacare very expensive.  Because with preexisting conditions covered a few people will now have to a pay a lot.

Workers seeking coverage in the state-based marketplaces, known as exchanges, can qualify for subsidies, determined by a sliding scale based on income. By contrast, the new law does not allow workers in the union plans to receive similar subsidies.

Bob Laszewski, a health care industry consultant, said the real fear among unions is that “a lot of these labor contracts are very expensive and now employers are going to have an alternative to very expensive labor health benefits.”

“If the workers can get benefits that are as good through Obamacare in the exchanges, then why do you need the union?” Laszewski said. “In my mind, what the unions are fearing is that workers for the first time can get very good health benefits for a subsidized cost someplace other than the employer.”

You see, the Obama administration cannot give a subsidy to the unions.  Because they have to pay for subsidies they give to low-income people with a ‘tax’ on other insurance plans.  That is, the people who can afford to pay for health insurance have to pay the subsidies for those who can’t.

The ultimate goal of Obamacare is to put the private health insurers out of business so the government can step in and get what they want.  National health care.  Of course, doing that has one big drawback for these unions.  With national health care you don’t need to belong to a union any more for the kind of health care benefit that provides for you and your family even when you’re unemployed.

Labor unions have been among the president’s closest allies, spending millions of dollars to help him win re-election and help Democrats keep their majority in the Senate. The wrangling over health care comes as unions have continued to see steady declines in membership and attacks on public employee unions in state legislatures around the country. The Obama administration walks a fine line between defending the president’s signature legislative achievement and not angering a powerful constituency as it looks ahead to the 2014 elections.

The cost of unions has pushed most of U.S. manufacturing offshore.  Public sector unions are bankrupting city and state governments.  And even the state of Michigan, home of the automotive industry, has voted to become a right-to-work state.  The heyday of the unions is over.  And they’re struggling to hold onto what little they have.  Especially in the private sector.  Where their ranks have done nothing but fall since the Sixties.

The unions poured money into the reelection of President Obama because Democrats are supposed to make things better for unions.  Not worse.  At this rate unions may start voting Republican.  For though they may not have as generous union contracts they may at least still have union contracts.  Because with the business-friendly environment of the Republicans there may at least be a building boom.  And more union construction jobs.

As the 2014 midterm elections draw close you may see a louder voice for the repeal of Obamacare.  This time coming from one-time vocal supporters.  Perhaps giving Democrats a difficult time at winning their elections.  Unless they come out for the repealing of Obamacare, too.  For unions may have at one time thought about how nice it would be to get rid of that costly benefit from their benefit package.  Which will happen if Obamacare evolves into national health care.  But now they’re seeing that this outcome may make unions irrelevant.  And are likely thinking, “My God, what have we done?”

It just goes to show you have to be careful what you wish for.  Because sometimes those wishes come true.


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