Obamacare is Not Going to be the Disaster Conservatives Hope It Will Be

So says Jonathan Chait:

 . . . looking even an inch beneath the surface reveals a public more frustrated and confused by Obamacare than opposed. Its specific elements poll well, though they’re the least known elements. Four out of ten Americans don’t realize the law hasn’t been struck down. A new poll out shows that the public, by a ten-point margin, trusts Democrats over Republicans on health-care issues. By a 52–34 percent margin, they want Congress to implement or tinker with the law rather than repeal it. The nearly ubiquitous conservative belief that the public shares its passion for repealing Obamacare is a spate of self-delusion. [snip]

The tiny kernel of truth is that a handful of people — mostly young, male, and healthy — will have to buy into some kind of regular insurance plan that covers stuff, not only plans that cover your costs if you’re injured in a car crash and make you pay for just about everything else. The scare campaign could work, at least to some extent. But if it works, it won’t work because Americans are dying to be converted to an all-catastrophic, high-deductible system.

What Republicans have going for them is that health care is really complicated, people don’t spend hours a day boning up on public policy, and those who have insurance understandably fear losing what they have. But the vast majority of the public is not going to see any changes under the new law. Even if the Obamacare exchanges collapse, they only bring in people who don’t have Medicare or employer coverage anyway and are already suffering through a dysfunctional individual insurance market. The “shock” is going to be felt by conservatives who are expecting their Randian fantasies of socialist dystopia to come true.

The tragedy is that our old system was utterly unworkable and the new system isn’t really much of a new system.  The Affordable Care Act represents a serious attempt to fix a real world problem.  It’s a Rube Goldberg device, doing in complicated ways what should have been done in simple ways.  That said, full implementation has the potential to greatly benefit millions of Americans – simply removing the life time caps and the exclusions for pre-existing conditions will benefit people.  The mandate isn’t all that scary since lots of people can simply pick up their employer’s insurance (FWIW, I’ve never understood why anyone would want to be without health insurance – all it takes is one night in the hospital to make it worth it).  The real problem is the number of states opting out of the medicaid expansion, which will have a huge impact on those living in poverty.

  1. #1 by Richard Warnick on June 13, 2013 - 4:12 pm

    The most significant fact about the ACA so far is employers dropping health care coverage, or threatening to.

    The universal coverage requirement and the state health insurance exchanges needed to make it work will start Jan. 1. Some employers have said they may drop health insurance because it would be cheaper to pay a $2,000 fine and have employees buy insurance through the exchanges instead of paying an average of $15,000 to buy that employee health insurance.

    Other employers have said they will drop employees’ hours below 30 a week to avoid the requirement to provide insurance or pay a fee.

    If so, employers would be following a trend that started before the health care law passed in 2010. The new study found that employer-sponsored coverage dropped from 69% to 60% between 1999 and 2010. The amount each employee paid annually for insurance more than doubled in that period from $435 to $1,056 for an individual and from $1,526 to $3,842 for a family.

    • #2 by Glenden Brown on June 14, 2013 - 9:54 am

      Richard,

      The article you linked to pointed out that employers were already dropping insurance coverage prior to the adoption of the ACA. What’s happening seems to be less a new trend than a continuation of an old one. The new dynamic is keeping part time employees below 30 hrs per week. It sounds terrible but if an employee consistently works 31 hrs per week, you have to provide them insurance. It’s preferable to keep them at 29 hrs per week. Employers are subject to a mandate as well – and the penalties are actually steeper than most employers think – they’re not assessed on number of employees, it’s based on covered members. I wouldn’t be surprised to see employers offer employee only plans – the mandate requires that employers offer insurance to employees, not their families.

      I’ve said it before and I’ll say it again, the ACA is a complex way of doing something that should have been simple. The idea that we can somehow preserve our atomized system of employer based coverage and private carriers and manage costs and provide universal coverage is risible.

      • #3 by Richard Warnick on June 14, 2013 - 11:29 am

        The ACA has many problems, only one of which is the reliance on employer-provided insurance plans – which are gradually going away due to high costs and unaffordable premiums.

        Maybe the biggest problem is that few people understand the changes, as Jonathan Chait said up front.

        If it turns out that the ACA only affects “a handful of people,” then it’s fair to ask why the U.S. Congress spent so much time on this instead of doing more for economic recovery.

        Health coverage may be unaffordable for low-wage workers

        The law is complicated, but essentially companies with 50 or more full-time workers are required to offer coverage that meets certain basic standards and costs no more than 9.5 percent of an employee’s income. Failure to do so means fines for the employer. (Full-time work is defined as 30 or more hours a week, on average.)

        But do the math from the worker’s side: For an employee making $21,000 a year, 9.5 percent of their income could mean premiums as high as $1,995 and the insurance would still be considered affordable.

        …Another thing to keep in mind: premiums wouldn’t be the only expense for employees. For a basic plan, they could also face an annual deductible amounting to $3,000 or so, before insurance starts paying.

        • #4 by Glenden Brown on June 14, 2013 - 1:22 pm

          The theory behind the ACA says that the multiple moving parts – the no exclusions for pre-existing conditions, no lifetime caps, the various mandates, the exchanges and so on – will work together to get costs under control. The complexity of managing all those moving parts has allowed conservative critics to dishonestly manipulate public debate and opinion.

          Consdier this scenario for low wage workers: if their employer offer a qualified plan, employees are still free to purchase coverage through the state exchanges, but they won’t qualify for subsidies. So they will be forced to rely on plans with huge deductibles which for many people is effectively the same as no insurance, which is why the ACA included a Medicaid expansion.

          • #5 by Richard Warnick on June 14, 2013 - 2:54 pm

            A very important part is missing, IMHO. The public option.

          • #6 by Glenden Brown on June 14, 2013 - 3:57 pm

            Absolutely – the ACA should have included a viable public option, a form of Medicare for all that people could opt into. I think it was killed because the insurance companies know, given that option, that more and more people would opt in and leave the private market.

        • #7 by Ronald D. Hunt on June 17, 2013 - 10:11 pm

          “For an employee making $21,000 a year, 9.5 percent of their income could mean premiums as high as $1,995 and the insurance would still be considered affordable. “

          Only if they are single, as a couple or even small family they would be receiving care via the medicaid expansion.

          This figure is only in the context of a single adult, and this would have to be the Adjusted gross income, so add the standard deduction and any other tax benefits to get to real income.

          “For a basic plan, they could also face an annual deductible amounting to $3,000 or so”

          Out of pocket expenses are capped at 12% per year, and I believe this includes premiums. albeit, this cap may only apply to plans in the exchange.

          However i fully expect most low wage employers to dump their employees into the exchanges and simply pay the fine, as that is cheaper for them then a plan that meets the minimum requirements.

      • #8 by Ronald D. Hunt on June 17, 2013 - 9:57 pm

        ” It sounds terrible but if an employee consistently works 31 hrs per week, you have to provide them insurance.”

        This is incorrect, The ACA uses full time equivalent(FTE’s) employees not, the count of full time employees.

        It doesn’t matter how many hours your part timers work, the total amount of hours they work is added up and divided by 30(per week, well actually 120 as it is determined on a monthly basis not weekly) to determine the number of FTE’s and tax liability.

        Yea their are alot of people misunderstanding this one, and its gunna bite some businesses in the ASS hard, when their little game backfires.

        There is alot of bad advise on avoiding Obama care going around, and people should be angry at the fools spreading it(mostly conservative groups trying to gin up anger).

        • #9 by brewski on June 18, 2013 - 2:38 am

          RDH,
          You are misunderstand this. There are two separate tests and two separate uses. The 50 FTE test is whether the employer is required to offer coverage. But even if the employer has 1,000 FTE’s it still only has to offer coverage for those employees who work more than 30 hours per week. So it is quite legal and possible for an employer who has 10,000 FTE’s but all of them work 29 hours that the employer would not have to provide insurance to any of them.

          • #10 by Richard Warnick on June 18, 2013 - 1:26 pm

            Some employers will comply with the ACA by offering health insurance with premiums up to 9.5% of the employee’s salary (so-called “affordable” coverage) coupled with a $3,000 – $6,000 annual deductible. This is the functional equivalent of not offering insurance.

          • #11 by Glenden Brown on June 18, 2013 - 2:51 pm

            Richard – bear in mind that high deductible plans such as your describing are required to cover preventative treatments with no out of pocket – annual exams, flu shots, vaccinations etc. are covered with no direct cost to the insured. A single night in the hospital and it’s not hard to hit the deductible. It’s the giant doughnut hole in the middle that’s problematic.

          • #12 by Ronald D. Hunt on June 18, 2013 - 7:52 pm

            50FTE test relates only to tax liability, the employer does not have to offer a qualifying plan until 1000FTE, however the requirement to offer a plan and the tax liability for health coverage are 2 separate things.

            Part timers not offered a plan by their employer can get coverage via medicaid or the subsidy via the exchanges.

            “Some employers will comply with the ACA by offering health insurance with premiums up to 9.5% of the employee’s salary (so-called “affordable” coverage) coupled with a $3,000 – $6,000 annual deductible.”

            Out of pocket expenses including premiums are capped at 12.5%, no insurance company is going to sell that plan as the deductible via regulation would be capped at $1000~ or so regardless of what they wished to label it as.

            The only way that would work is if the employer also provided a HSA that carried over year to year(most HSA’s are yearly use it or lose it deals), and for a low wage employee it is unlikely that such an account would grow enough to average out the excess cost of that deductible.

  2. #13 by cav on June 15, 2013 - 5:00 pm

    brewski, if you’ve commented on this thread besides, #7, I’ve seen no evidence.

    Maybe your packets alone are being banked by PRISN.

  3. #14 by Larry Bergan on June 15, 2013 - 10:26 pm

    I’m not getting involved in this, other then to say that in the future, brewski should probably not waste his time commenting on Glenden’s posts.

    Glenden had already admitted to deleting them before.

    I wouldn’t blame Glenden for cleaning up his own posts, because: Let’s face it; sometimes brewski lies. That’s one of the reasons he won’t tell us his real name.

    Just sayin’.

  4. #15 by cav on June 15, 2013 - 11:32 pm

    Glenden ‘Clean-Sweep’ Brown?

  5. #16 by Larry Bergan on June 18, 2013 - 8:29 pm

    I’m sorry, but Obamacare is just too complex.

    How are Grandma and Grandpa, or their children going to be able to figure out how to know what to do?

    Are they supposed to hire a lawyer they can’t afford?

    • #17 by Larry Bergan on June 18, 2013 - 10:00 pm

      Well, brewski; Glenden has never changed his name.

      I realize you’ve been kicked around here, but you’ve never had a real name. you will admit that.

      Why would you come here and comment without a real name?

      • #18 by brewski on June 19, 2013 - 6:45 am

        Ask Cav

  6. #19 by cav on June 18, 2013 - 9:01 pm

    Suppose I build a hospital, and advertise for doctors. I’m willing to pay $3K a month. Nobody shows up.

    I guess I’d be entitled to say that the medical schools simply aren’t doing their jobs. Or that Obama-care sucks. Or I can outsource the procedures to Mumbai and Lagos!

    It’s all good.

  7. #20 by cav on June 19, 2013 - 7:32 am

    RIP Michael Hastings.

  8. #22 by brewski on January 21, 2014 - 11:22 pm

    You might be wondering, “How could ObamaCare possibly get any worse?”

    Good question. After giving a $600 million no-bid contract to an incompetent Canadian company with a terrible track record whose top executive was a pal of Michelle Obama, they’ve decided to get serious and go with a company with a perfect track record.

    Accenture.

    That sounds safely bland. Like a brand of detergent. Or a website that sells imported French pants. Accenture could be anything at all.

    Accenture is a multinational management consulting, technology services and outsourcing company. Incorporated headquarters are in Dublin, Republic of Ireland while operations headquarters are in Chicago, Illinois.

    A Chicago company with an Irish address to dodge taxes. That’s regrettable, but not too surprising. But did this Accenture place happen to have another name? A more familiar name.

    Accenture began as the business and technology consulting division of accounting firm Arthur Andersen. On January 1, 2001 Andersen Consulting adopted its current name, “Accenture”.

    Arthur Andersen? Wait that sounds oddly familiar.

    Te U.S. Justice Department today announced the indictment of embattled accounting firm Arthur Andersen on one count of obstruction of justice relating to the collapse of former energy giant Enron Corp.

    The obstruction charge is based on claims that Andersen employees shredded important documents about Enron’s finances, even though they knew the Securities and Exchange Commission was formally looking into Enron. The Justice Department also alleges Andersen employees deleted relevant computer files.

    Andersen served as Enron’s sole auditor throughout the energy giant’s sixteen years, also performing internal audits and consulting services.

    Andersen has recently been involved in several other major auditing scandals. Last year, the SEC fined the firm $7 million for ‘improper professional conduct’, including overstating client Waste Management’s earnings by $1.4 billion. It was the first successful case against an auditor in over 20 years. In May 2001, Anderson also paid $110 million to Sunbeam shareholders to settle lawsuits stemming from its inflated earnings statements.

    Andersen and Enron both had deep ties to the Democratic Party and Accenture spends a lot of money on lobbying. The top recipient for Accenture donations is an obscure Chicago politician named Barack Obama.

    “The Washington Post reported on Friday that Accenture will get a year-long contract worth about $90 million for the ObamaCare website.”

    But at least Accenture doesn’t have a history of failure working with national health care systems.

    Accenture has pulled out of the £12.4bn NHS IT programme and terminated the £2bn-worth of contracts it was working on to deliver new patient and GP systems.

    Accenture warned in its financial results earlier this year it expected to take a $450m hit on its NHS IT contracts over the next three to four years because of delays that led it to miss the deadlines for delivering working systems.

    One NHS IT director in the North East region, who did not wish to be named, told silicon.com there is a mood of “anger” within the NHS at the lack of progress.

    The IT director said: “Accenture have done absolutely nothing in the North East and for the past nine to 12 months they have been invisible. They have been here for nearly three years and they have done nothing, yet it has put planning blight on any progress that was being made before.

    So this should go well now that Obama has brought on board a Chicago company whose name in professional circles is Accidenture.

  9. #23 by Anonymous on January 23, 2014 - 1:29 pm

    Accenture’s bread and butter has been devising systems which eliminate corporate expenses, in a word, jobs, whatever can be automated will be, whoever can be eliminated…

    Should work out great for health care as labor intensive as that stands to be.

  10. #24 by brewski on January 23, 2014 - 1:38 pm

    McKinsey does the same thing.
    What privileged white kid’s first job out of college was with McKinsey? Chelsea Clinton.
    The hypocrisy rolls on.

  11. #25 by Anonymous on January 23, 2014 - 4:14 pm

    It isn’t hypocrisy when the whole band are all working for the same team.

    Chelsea Clinton working for the sharks, she may yet be her mama’s girl..

  12. #26 by brewski on January 23, 2014 - 7:32 pm

    Yes it is hypocrisy when you go around telling everyone how you care so much about the middle class. Do you know what hypocrisy means?

  13. #27 by Anonymous on January 24, 2014 - 10:03 am

    Do you even know that there is no difference between any of them?

    By their deeds shall they be known.

    In that do you actually believe what they say is what they actually believe?

    Plenty of evidence that the bulk of most posturing is just for
    show, before foregone conclusions..in real life who all these people are serving is all too clear.

    • #28 by brewski on January 24, 2014 - 1:44 pm

      Tell that to Richard. He thinks they “care”.

  14. #29 by Anonymous on January 24, 2014 - 1:54 pm

    “it’s a big club, and you ‘aint in it”. George Carlin.

  15. #30 by Larry Bergan on January 24, 2014 - 4:55 pm

    Anonymous is in the anonymous club!

    Yeah!

  16. #31 by Larry Bergan on January 24, 2014 - 5:07 pm

    I”m waiting to see if governor Gary is going to establish Medicade in a few days. Don’t know if I can even afford that without losing my house.

    Can I reject care altogether?

    What are my options?

  17. #32 by Anonymous on January 24, 2014 - 5:57 pm

    You are a slave now, you have no options..and as bad as it is, NSA, NDAA, N’d of Civ’lization, just plain content to stay in anonimity..

  18. #33 by Anonymous on January 24, 2014 - 6:09 pm

    mispelt to direct the metadata into the cyber nowhere..

  19. #34 by Ronald D. Hunt on January 24, 2014 - 6:31 pm

    http://www.sltrib.com/sltrib/news/57438301-78/medicaid-expansion-health-federal.html.csp

    Utah will expand.

    This also brings the number of States expanding to half the union.

  20. #35 by Anonymous on January 24, 2014 - 7:17 pm

    In the context of the nationwide demographic this is news?

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