Mustapha00
Well-Known Member
http://www.nytimes.com/2015/07/04/u...es-seek-big-rate-increases-for-2016.html?_r=0
Insurance providers are asking for premium increases of 20% to 40%- or more- in order to cover the influx of Obamacare patients because those patients are turning out to be sicker than they- or Obama- envisioned.
Many statistics that refer to "health care costs" do not include the costs of insurance premiums, thus their fixation on a slowing in the increases of costs does not take in the entire picture. No doubt that 4% to 6% increase in "health care costs" looks very good, but it measures only the costs of the particular treatments themselves; it does not factor in the dramatically increasing costs of the insurance which many, many millions of people rely on to reduce their out of pocket expenses.
The NYT article also reminded me of yet another reason why I think Obamacare was created purposely to fail. Consider that one of its precepts was to discontinue the ability of an insurance company to refuse coverage based on pre-existing conditions, meaning that people with illnesses that are often very expensive to treat could not be treated any differently by insurance companies that individuals with perfect health. In order to reduce the cost spike to insurers, Obamacare introduced the "Individual Mandate", which forces everyone to have health insurance or to pay a "penalty". The idea here was to force young people, who tend to be healthier, to purchase insurance at a higher rate than they normally would pay in order to subsidize older and sicker folks so they would pay a lower rate than they otherwise would or face paying a penalty.
OK...so how much is that penalty for not having health insurance? In 2015, it was $325 or 2% of yearly household income. That increases to $695 or 2.5% in 2016.
And how much is the yearly premium for the cheapest Obamacare plan? $2411.
So why pay $2400 for insurance, asks young, healthy folks, when I can pay a $325 penalty and pocket over $2000 difference? Simple answer: they didn't, and so the whole Obamacare mess is going to prove more costly than anticipated because those signing up are poorer (requiring larger subsidies from the government to pay the premiums) and sicker (requiring more costs of treatment).
If Obamacare were truly meant to be a credible alternative to the current system, the penalty would have been the same as the lowest tier of premiums, thus giving individuals no choice but to sign up. But it wasn't crafted that way....I wonder why not?
Insurance providers are asking for premium increases of 20% to 40%- or more- in order to cover the influx of Obamacare patients because those patients are turning out to be sicker than they- or Obama- envisioned.
Many statistics that refer to "health care costs" do not include the costs of insurance premiums, thus their fixation on a slowing in the increases of costs does not take in the entire picture. No doubt that 4% to 6% increase in "health care costs" looks very good, but it measures only the costs of the particular treatments themselves; it does not factor in the dramatically increasing costs of the insurance which many, many millions of people rely on to reduce their out of pocket expenses.
The NYT article also reminded me of yet another reason why I think Obamacare was created purposely to fail. Consider that one of its precepts was to discontinue the ability of an insurance company to refuse coverage based on pre-existing conditions, meaning that people with illnesses that are often very expensive to treat could not be treated any differently by insurance companies that individuals with perfect health. In order to reduce the cost spike to insurers, Obamacare introduced the "Individual Mandate", which forces everyone to have health insurance or to pay a "penalty". The idea here was to force young people, who tend to be healthier, to purchase insurance at a higher rate than they normally would pay in order to subsidize older and sicker folks so they would pay a lower rate than they otherwise would or face paying a penalty.
OK...so how much is that penalty for not having health insurance? In 2015, it was $325 or 2% of yearly household income. That increases to $695 or 2.5% in 2016.
And how much is the yearly premium for the cheapest Obamacare plan? $2411.
So why pay $2400 for insurance, asks young, healthy folks, when I can pay a $325 penalty and pocket over $2000 difference? Simple answer: they didn't, and so the whole Obamacare mess is going to prove more costly than anticipated because those signing up are poorer (requiring larger subsidies from the government to pay the premiums) and sicker (requiring more costs of treatment).
If Obamacare were truly meant to be a credible alternative to the current system, the penalty would have been the same as the lowest tier of premiums, thus giving individuals no choice but to sign up. But it wasn't crafted that way....I wonder why not?