by Jane M. Orient, M.D.
The Big Lie of ObamaCare is in the title: the Affordable Care Act. Administration officials invoke “affordable” over and over again.
The U.S. Supreme Court could well blow the Democrats’ cover in King v. Burwell if it rules that people in the 37 states that did not establish an Exchange cannot legally get taxpayer subsidies for health insurance.
The subsidies hide the reality. People generally look only at what they themselves have to pay. They do not care what faceless taxpayers are paying to insurance companies for their policies.
Of the 11.7 million Americans who now have private health insurance through federal and state marketplaces, 86 percent of them are receiving financial assistance from federal taxpayers to help pay premiums—or, more accurately, their insurance company is.
“More than seven million people could lose subsidies, making insurance unaffordable,” said White House officials, according to the New York Times.
These subsidies (“tax credits”) averaged $263 a month and reduced the premium by 72 percent, on average. Taxpayers who manage to earn more than a certain threshold thus have to pay 100 percent of their own premiums plus their “fair share” of 72 percent of premiums for those who earn less.
Assuming that they will be blamed for the surge in the number of uninsured, although they did not write the law, congressional Republicans are scurrying for ways to “fix” the problem of a purported “mistake” in drafting the law.
The only problem they apparently see is that people would lose coverage—not that ObamaCare drove premiums to unaffordable levels. And the only remedy they can think of is to force others to pay the unaffordable cost, at least for a time. Not having learned from vast experience, they assume that an extension of subsidies will be temporary.
One would like to see Republicans explain to the people why the whole structure of ObamaCare is a mistake, which worsens and solidifies the problems that make American medical care so costly in the first place. These are the simple, incontrovertible facts:
• Guaranteed issue/community rating always drives up premiums and leads to a “death spiral.” Unless premiums are based on risk, people have no incentive to buy insurance when they are well.
• Mandates to pay for expensive services people do not need or want help purveyors of such services but drive up premiums.
• Third-party payment itself always and everywhere drives costs far higher than people would pay if spending their own money.
• Administrative micromanagement drives up costs and limits access.
• Insurance is not the only way to buy medical care—just the most expensive way.
ObamaCare needs to be repealed. Tweaking one of the interlocking parts just makes the interconnected rest even more unworkable. If the Supreme Court exposes the true cost by removing the veil of subsidies, Republicans should not try to cover it up.
If people lose coverage, another shocking truth might be revealed, to the horror of the insurance cartel: they might be better off. The unsubsidized share of premiums—instead of being sucked into the insurer’s bank account—would be available to buy actual care, which people might now avoid because of high ObamaCare deductibles. A market might develop for true catastrophic-only insurance, with appropriately low premiums. Note that if ObamaCare insurance becomes unaffordable because of lack of subsidies, the individual mandate penalty/tax does not apply.
Of the money paid to insurers, at least 15 percent goes to administration and much more to activities like “quality assurance” that provide nothing recognizable to patients as a medical service or product. And if the insurer does pay for something, it decides exactly what, when, and how much a beneficiary might receive.
There are many alternatives to dependence on the government/insurer monolith, which the cartel would love to crush, such as health sharing ministries, direct-pay practices, and indemnity insurance. More resources are becoming available to patients (for example, medicalselfsufficiency.com and selfpaypatient.com).
Republicans should not help to suppress alternatives by propping up the ObamaCare monster and leaving the façade of subsidies intact.
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