Skip to comments.Obamacare Coverage Is Worse than Nothing for Most People
Posted on 02/22/2016 3:58:09 PM PST by Kaslin
Most left-leaning health policy wonks assume everyone needs health coverage. I've never understood that. Insurance is a way to protect assets for people with assets to protect. Economists also sometimes describe health insurance as income protection in the event of an illness, since medical care costs money. Economist sometimes view health coverage as the ability to buy highly subsidized medical care in the event of an illness. Families' health risks, aversion to risk and family finances differ, so arguments that everyone needs the same type of protection against medical bills are not particularly convincing. To cloud the issue even further, the aforementioned left-leaning policy advocates often believe that any system that requires reaching for one's wallet during a medical encounter is unethical, since not everyone has a wallet of the same thickness. Again, this makes no sense since the poor would benefit more than the wealthy from the savings by forgoing costly health coverage. Obamacare has caused more people to reach for their wallets after a medical encounter -- not less.
Because advocates think health coverage is something that everyone should have, one of the primary goals of the Affordable Care Act was to expand coverage to the uninsured. Their thinking was that some of the uninsured could not afford health coverage because their incomes were not sufficient, while others could not afford coverage because of health concerns that made medical underwriting costly. What difference did it make? Obamacare made them worse. A few weeks ago, I wrote how under Obamacare people with health coverage can rack up huge medical bills despite having insurance. Basically, Obamacare destroyed their insurance -- at least the kind of coverage they once had. The only coverage many people can now afford are plans with excessively high premiums in return for excessively high deductibles -- leaving few funds left over to pay for medical bills out of pocket or fund a health savings account.
Earlier this year, a report from the University of Pennsylvania found all but the most heavily subsidized Obamacare enrollees would be better off financially if they skipped coverage and pay for their own medical care out of pocket. The people whose incomes fall between 1.38 and 1.75 times the poverty level will spend about three times the amount on premiums for a Silver plan as they would have out of pocket had they remained uninsured. For those earning more than 250 percent of poverty, most will be worse off financially compared to having remained uninsured. By design, Obamacare is a bad deal for most people! Except for the unlucky few who experience catastrophic health complaints, the vast majority of Obamacare enrollees would be better off uninsured.
From an efficiency standpoint, paying for routine medical bills out of pocket costs less than paying bills through an insurer who, in turn, funds medical claims from premiums. In the process of trying to make medical care cheaper for those with pre-existing conditions, Obamacare has made most enrollees worse off than prior to the Affordable Care Act. Paradoxically, they are even worse off than being uninsured.
Indeed, deductibles in the exchange have risen to the point that most enrollees pay virtually all their routine medical needs out of pocket. With deductibles of $5,000 or more becoming common, Obamacare is becoming little more than a sickness tax on people who don't expect to reach their deductibles. It's an unofficial tax on most enrollees to reward insurers and offset some of the cost of insuring the few people with major health conditions. That is not an efficient way to subsidize medical care.
I've talked to people who say they've made the conscious decision to forgo Obamacare and just pay the penalty and pay cash for medical care. A few even think they can get out of the penalty. One lady I talked to suggested she'd be far better off just taking the money she would have spent on largely worthless insurance coverage and using it... (hold on to your hats, this is controversial!) on actual medical care. She will pay out of pocket for her physician visits. She will use a discount pharmacy card for her prescription drugs. She will pay for laboratory testing out of pocket. She's even considering having some procedures done that her insurance would never have covered, even if she met her deductible.
There are arguably other benefits to American revolting against Obamacare and remaining uninsured. The Rand Health Insurance Experiment of the 1970s found when people were exposed to significant cost-sharing, they consumed about 30 percent fewer medical services on average. More recently, research by the Kaiser Family Foundation found the uninsured consume only about half the care of those with coverage ($2,443 vs. $4, 876).
It's rather sad when you realize the Affordable Care Act made health care unaffordable and left the formerly-insured better off with no coverage. As I've already explained, it would be far cheaper for most to just pay bills out of pocket with the money they saved by going bare. Obamacare is hardly a legacy to celebrate.
Trumpcare will be better, fantastic, with the best people running it. it’ll be huge!
Then why am I hearing of people going to get health care and are told that the doctor doesn’t take obamacare?
Most of the uninsured would be eligible for Medicaid.
A far better value than Obamacare Silver.
>>Earlier this year, a report from the University of Pennsylvania found all but the most heavily subsidized Obamacare enrollees would be better off financially if they skipped coverage and pay for their own medical care out of pocket.<<
Wanna bet 75+% of those people voted for obozo?
Me? *pphhtt* a few hundred bucks a year. Not fun but no big deal.
You idiots that voted for Dear One: think about it. Do you think obozocare even slightly affected pelosu, feinstein or even sanders? HAH!
Own it, suckers. Long and hard.
See XerioCare tag line.
The whole concept behind ObamaCare is idiotic:
Have the insured pay out of pocket for smaller expenses (in effect discouraging them), and only partially cover ‘catastrophic expenses’.
When I joined Kaiser years ago, they mentioned that their approach to cut costs was to emphasize regular checkups and catch medical problems BEFORE they developed, since after they became a major problem is was too expensive to solve them (or would be unable to, in which case you died). It made total sense to me.
So now, Obama care is: don’t brush your teeth, and we will pay (after a large deductible) only when you need a root canal, major oral surgery, or all your teeth pulled.
Same as discouraging some one from regular oil changes, and only paying for a portion of the engine replacement after it burns down. What a waste!
Makes no sense. Repeal it!!
I have a $4500/year premium that doesn’t pay a nickel until I am $3000 out of pocket.
It will be better because people won't be dying in the streets! They will be dying in waiting rooms and at home.
I hear ya. Now my deductible is $5,000 and my premiums just about doubled.
To top it off, DS1 just flipped his truck and we just got him home from 3 days in the hospital and a 7-hour emergency surgery.
Afraid this is going to be a bumpy ride :-(
What does a wall have to do with anything?
Here’s what I could never understand. Why couldn’t there be a kind of catastrophic health care umbrella policy? For normal cuts and aliments, you pay out of your pocket. Maybe you decide you can live with out those stitches in your leg (hey, life is fraught with economic decisions). You get cancer, or or in a car wreck, your catastrophic policy kicks in. Take advantage of the marketplace.
Completely predictable. Most of the left thought that the problem with passing HillaryCare was that Hillary left the big insurance companies out of the discussion leading to her bill. In fact, the architect of Britain’s healthcare system said they passed theirs because they got the insurance companies on board.
The insurance companies were major contributors to ObamaCare. Why is anyone surprised that the insurance companies protected themselves at the expense of those it was supposed to help. The only reason the insurance companies are losing their shirts now is the fact that Rubio stopped their subsidies.
Husseinocare was designed to screw businesses and hence the economy
Everything Hussein has done is to screw America. Why would you expect Americ’s first Muslim President to do anything different?
Our amazing family doctor of 30+ years just quit practicing medicine. We were always so thankful to have him as our doctor. He would take the time (usually an hour each office visit) to discuss health issues with us. He kept complaining about the massive paperwork requirements that kept building over the last 7 years.
Now he is gone.
Thanks, obama. And the cowardly GOPe that enabled him.
When I heard Donald promise us "everything" I pretty much gave up on any hope of repealing Obamacare if he wins. At best His Donaldness is going to waltz into office thinking he can use government to fix problems. The real problem is that strategy is liking pounding nails in with dynamite.
I am assuming this post was not in jest? Such policies were commonplace before "OCARE", they probably still exist but, since they do not meet "THE MANDATE". you would pay an IRS penalty if you bought one today!!
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