Democratic Excuses For Failing ObamaCare

 

Admitting a mistake is hard for everyone; for Democrats supporting ObamaCare it’s impossible. Witness the lame excuses they’re making now to explain the skyrocketing insurance premiums released recently.

Avik Roy, writing in Forbes, gives us five lame excuses Democrats are promoting in the wake of the catastrophic premium hikes for ObamaCare I chronicled in my recent post, Skyrocketing Insurance Premiums as ObamaCare Implodes.

Excuse #1 – Few Americans are affected by ObamaCare premium hikes.

Economist and former Obama administration official Austin Goolsbee argued that only 3% of the country is affected by these premium hikes. Roy says there are 3% enrolled in exchange policies, but another 2.5% enrolled in non-exchange policies and another 30 million (10%) who aren’t insured at all because they can’t afford it. That’s a total of 15.5% of the country, one-sixth or roughly 50 million Americans. So the Obama administration is writing off the concerns of one –sixth of the country!

Excuse #2 – ObamaCare premium hikes don’t matter because we can subsidize them.

The Obama administration continues to claim that 85% of exchange enrollees receive subsidies. Last week I quoted insurance industry analyst Robert Laszewski who says the actual number is about 50%. So at least half of those enrolling on the exchanges don’t get a subsidy.

Roy then points out that soon even that will change. A somewhat obscure provision in Section 1401 of the Affordable Care Act specifies that once exchange subsidy spending exceeds 0.504% of GDP, ObamaCare subsidy spending can only increase by a formula tied to inflation. The Congressional Budget office expects us to hit that trigger point sometime around 2023.

Excuse #3 –Premiums would be even higher if ObamaCare hadn’t passed.

This excuse is just pitiful. It assumes we can’t actually measure something that didn’t happen but we can measure the rate of increase in insurance premiums that was happening just before the passage of ObamaCare.

Roy says, “As a reminder, premiums have gone up by a cumulative 116%, on average, under the ACA. That is way above normal health care inflation. According to research from the Commonwealth Fund, for example, the average employer-sponsored family health insurance plan cost $12,298 in 2008, and $16,029 in 2013: an annualized increase of 5.4 percent. Over four years, that translates to a cumulative increase of 23.6 percent.”

So if ObamaCare had not become law, the expected rate of insurance premium increases would have been about 24%. Instead we got 116%! And remember President Obama promised us we would all see our healthcare premiums go down $2500 per year!

Excuse #4 – Premiums are high because Republicans oppose ObamaCare.

When excuses are getting thin, always remember to blame Republicans! Goolsbee actually tried to argue that the problem is Republicans telling people not to enroll.

Let me see if I understand this argument. Mr. Goolsbee wants us to believe that Republicans are convincing young and healthy Americans, who vote predominately Democratic and helped elect President Obama, that they shouldn’t cooperate with Democrats and should protest by refusing to enroll in ObamaCare? As an economist, Mr. Goolsbee should easily understand that these young Americans are refusing to enroll because ObamaCare is a poor value product and the young are making a rational economic decision, despite their Democratic leaning!

Excuse #5 –Premiums are high because Republicans won’t do what Democrats tell them to do.

This excuse claims that Democrats could fix the problems with ObamaCare if only the Republicans would go along with them. To examine this excuse, let’s look at the solutions proposed by Democratic presidential nominee, Hillary Clinton:

  • New regulations to cap out-of-pocket limits and force insurers to offer more generous coverage – This will cost insurers even more leading to even higher premiums. (Hillary is no businesswoman.)
  • Higher subsidies (paid by the taxpayers) – Again, this will not lower premiums, it will only shift the cost from enrollees to taxpayers.
  • A “public option” ­– This will not lower premiums either, but it will bankrupt the private insurance industry and lead to complete government takeover – socialized medicine. Hillary knows this and hopes this will happen.

 

Republicans rightly oppose these Democratic proposals to “fix” ObamaCare. It’s time that Democrats took responsibility for their healthcare system train wreck known as ObamaCare – instead of making excuses and blaming Republicans.

The victory of Donald Trump over Hillary Clinton signals loudly that the American people are fed up with ObamaCare and Democratic excuses. They should own up to its failure so we can have a serious debate about how to replace it with something that actually works. You can be sure this will be a high priority in the new Trump administration starting in January.

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