Will Obamacare succeed where term limits failed?

[Seamus Fermanagh]

The higher rates are a necessity. Adverse selection under the must-insure clause of the ACA guarantees participation by those in greatest need. Costs to insure must be passed on to the broader population or the whole system goes teats up in a hurry. If they truly wish for this new system to work, they are going to have to ramp up the penalties to a level at or near the cost of the least expensive exchanges. Otherwise, the very folks required to make the new system fiscally sound by putting in their higher premiums for relatively little service will opt out, pay the small fine, and self-insure their limited risk until they become chronically ill and the exchange represents an economic windfall.

[Montmorency]

I can't help but think that actually lowering costs across the board would be more effective as regards the Democrats' ideological goals than merely increasing the costs while forcing more individuals to pay toward them.

[Seamus Fermanagh]

I can't help but think that actually lowering costs across the board would be more effective as regards the Democrats' ideological goals than merely increasing the costs while forcing more individuals to pay toward them.

The total cost of care cannot be lower and must be significantly higher. Government figures suggest roughly 15% of all Americans are uninsured. 70% of that figure is uninsured for economic reasons -- coverage being too costly. Another portion cannot get insurance because they have been denied coverage due to pre-existing conditions that generate a high morbidity risk (these people were screened out of coverage by Insurance companies because insuring them, with their high likelihood of high costs, would have jacked up the overall rates of the coverage more.

Thus, in trying to cover everybody, we are increasing the number of people to be insured by 15-17 percent (depending on illegals). Moreover, some of those 15% include high morbidity cost individuals who are likely to create a greater cost vector than the "average" person. Let us assume that, all things being equal, aggregate cost of healthcare increases by 16% solely on volume (I would actually presume it to be more).

Some of this is supposed to be "headed off at the pass" by a greater reliance on preventive medicine to minimize the need for more costly interventions later. Recent projections put this savings at less than one quarter of one percent...but let's be perky and assume that over time we can make that a full 5%.

That takes our 116% total health costs and drops it back to 110% of current (again, I think I am being kind). However, 60% of that increased medical need (the uninsured) are because they cannot afford it NOW (poor, working poor, above poverty level but no room for frills). So that cost factor MUST be shoved onto those who are already paying (directly or indirectly) for their own insurance. If it isn't, it must be absorbed as additional debt by the Government.

In addition to those for whom the health care exchange packages must be more or less fully subsidized, other groups are being subsidized by the government as well, particularly for those in what we label our "lower middle class," to make their care "affordable." Those subsidies too must be passed on to the full price paying customers or absorbed as debt.

Costs for health care cannot go down and must go up. TANSTAAFL.

[Montmorency]

The total cost of care cannot be lower and must be significantly higher.

Nonsense. The list of treatments, tests, medications, etc. that are identical from country to country yet 5, 10, 20, or more times as expensive in the United States is of untold length. The fact of the matter is that there is a price-race between hospitals and insurance agencies and that obliterating the highly-inflated costs of the medical sector would easily permit the underfunded individuals that ACA purports to service to obtain affordable insurance on their own initiative.

Costs for health care cannot go down and must go up.

No, no, and no. This is an extremely dangerous position to take - just pay, and pay, and pay, and who cares why it costs so much or where the money is going, just keep paying!

[Xiahou]

No, no, and no. This is an extremely dangerous position to take - just pay, and pay, and pay, and who cares why it costs so much or where the money is going, just keep paying!

That's the whole premise of insurance. Who cares what it costs? It's not my money!

It's not surprising that costs spiral upwards when you setup perverse incentives like this....

[Seamus Fermanagh]

Nonsense. The list of treatments, tests, medications, etc. that are identical from country to country yet 5, 10, 20, or more times as expensive in the United States is of untold length. The fact of the matter is that there is a price-race between hospitals and insurance agencies and that obliterating the highly-inflated costs of the medical sector would easily permit the underfunded individuals that ACA purports to service to obtain affordable insurance on their own initiative.
....
No, no, and no. This is an extremely dangerous position to take - just pay, and pay, and pay, and who cares why it costs so much or where the money is going, just keep paying!

My comments were directed at the current system as modified by the ACA. What you are suggesting would involve a far more sweeping alteration than what is scheduled to occur. Perhaps we will head that way in time, but that is not the impact this law, as currently constituted, will have.

[Montmorency]

Fair enough, though I don't see why

Costs for health care cannot go down and must go up.

would be justified even in a narrow context.

It really is an alarming thought.

[Seamus Fermanagh]

Of course it is alarming. That's one of the reasons so many on the political right in the USA oppose it -- and I am not talking about the fruit bat fringe.

The basic idea is that more people will be provided service (the purpose of the act in the first place). That greater total amount of service will require more health care spending overall, even if there is somewhat less spending on a per capita basis (which is being argued).

Can that be altered? Yes.


To alter it in a substantial way would require:

1) A decrease in services.

2) An alteration in the services provided (shift to preventative for example).

3) An alteration in the population's behavior (overeating, under-exercising, & tobacco use).

4) Price controls on various elements of the health care system, notably salaries for medical licensed health care providers.

or some combination of 1-4.

#1 runs counter to the stated goal of making health care better for all, while 3 & 4 are problematic in implementation under our current system of governance. 3 & 4 would really only become possible under a full-on national health care system.


I should note here that any number of those on America's political left, along with some issue-by-issue types among the moderates, are angry with the situation and with the ACA precisely because it does NOT take the necessary steps to shift us to a true national health care system. I suspect that they're frustrated as well precisely because they believe that nothing less than such a system could truly influence the largest components of American Health Care costs: Poor lifestyle choices, Physician and specialist salaries, and Medical malpractice/insurance therefrom.

[The Lurker Below]

I can't help but think that actually lowering costs across the board would be more effective as regards the Democrats' ideological goals than merely increasing the costs while forcing more individuals to pay toward them.

Not sure if serious. I enjoyed the chuckles anyhow. Liberals feel less miserable only when everybody feels some of the misery.

[Xiahou]

The higher rates are a necessity.

Not just for the reasons you mention. What happens to prices when you increase demand for a good or service while having the same or decreased supply?

[Papewaio]

Not just for the reasons you mention. What happens to prices when you increase demand for a good or service while having the same or decreased supply?

Increased demand causes increased cost.

However you need to do a couple more iterations on this one or all you will do is prove firemen cause fires.

There is also the reduced cost in supplying something that is mass manufactured particularly designed once electronically manufactured many times.

There is no overall increased demand for being ill. People get sick regardless of having insurance or not. The overall healthcare system ie private and public has to care for the people and with chronically ill rarely if ever recovers any money.

What is increasing is demand for the insurers product. Which is highly scalable. What isn't is the doctors and hospitals so the insurers will be in a bidding war and/or build their own training hospitals to provide sufficient coverage. If anything they will make it scalable by trading between each other at a pittance and making the patients pay a significant markup ie ATMs