Republican candidates would be out of their minds if they didn’t use ObamaCare as a 2016 campaign issue. It’s an astonishing failure by every measurement.
Not a single promise has been kept, health insurance is objectively worse than it was before Barack Obama got his hands on it, and enrollment is only half what we were promised. The last detail is key, because low enrollment means everything bad about ObamaCare is going to get much worse in the years ahead, if we don’t kill it now.
The Beltway media bubble hums with rumors that Republicans, or at least the Establishment types, have quietly given up on opposing ObamaCare because it’s bulletproof, no matter how bad it stinks. The GOP Establishment was banking on the Supreme Court to kill the Affordable Care Act, but instead the Court morphed into a super-legislature and rewrote it twice to keep it alive.
The cold logic of dependency tells Republicans that even though most Americans are unhappy with ObamaCare, the people who do benefit from it – the designated “winners” who enjoy heavily-subsidized, artificially low insurance costs – will fight much harder to keep it than displeased Americans will fight to get rid of it. This is the political strategy underlying all socialist programs: diffuse costs, paid by suckers who are excoriated for their “greed” in left-wing culture if they dare to complain, paying for concentrated benefits, whose recipients are reminded to thank their political sugar daddies at the ballot box. It’s a rigged game the Left is never supposed to lose, until the house goes bankrupt and it all comes crashing down in flames.
ObamaCare is a game the Left can and should lose, setting a precedent for rolling back many other failed and corrupt Big Government schemes. That will only happen if Republicans make a serious effort to rally political energy around repeal… just as the Left would do, if a private-sector industry were failing on a comparable scale.
The reason we got stuck with ObamaCare is that liberals relentlessly attacked the health insurance industry for years, using government regulatory power to make it worse every chance they got. Power is cancerous – it can be used to make targeted private industries weaker, and less satisfactory to the consumer, until the Left feels strong enough to nationalize them.
That’s what happened with health insurance, where idiotic government regulations spread through the nominally “free market” insurance system until metastasizing into the tumor of ObamaCare… which is itself only a transitory stage, a public/private fusion designed to fail and usher in the eternal nightmare of single-payer socialized medicine.
The primary complained leveled against pseudo-free market health insurance, before the ObamaCare takeover, was that an unacceptably high number of Americans lacked coverage – and it was the fault of the evil insurance industry, a deficiency of the private sector that could be “fixed” with iron government regulations. Instead, we’ve got a massive crisis of ObamaCare under-enrollment on our hands, which the government and media downplay by mixing ObamaCare and Medicaid enrollment together, manufacturing bogus statistics about twenty-odd million people “gaining coverage” because of the Affordable Care Act.
Medicaid is not “health insurance,” it’s a welfare program. Americans were not told in 2010 that private insurance would be poisoned with paperwork, higher premiums, higher deductibles, and canceled plans in order to finance a titanic Medicaid expansion. They were told paid private insurance was going to be revolutionized, not cannibalized. A key part of Obama’s sales pitch was his cross-my-heart-and-hope-to-die vow that ObamaCare would be so awesome, people would voluntarily rush to sign up. All of his Big Lies were elements of that illusion: if you like your plan you can keep your plan, the average family will save $2500 a year on insurance, and the individual mandate is not a tax. Obama’s speeches often explicitly rolled these lies together into boastful predictions that Americans would abandon their old coverage voluntarily and stampede to the ObamaCare exchanges.
The truth, from a Wall Street Journal piece on “The Decline of ObamaCare” this weekend:
This month the Health and Human Services Department dramatically discounted its internal estimate of how many people will join the state insurance exchanges in 2016. There are about 9.1 million enrollees today, and the consensus estimate—by the Congressional Budget Office, the Medicare actuary and independent analysts like Rand Corp.—was that participation would surge to some 20 million. But HHS now expects enrollment to grow to between merely 9.4 million and 11.4 million.
Recruitment for 2015 is roughly 70% of the original projection, but ObamaCare will be running at less than half its goal in 2016. HHS believes some 19 million Americans earn too much for Medicaid but qualify for ObamaCare subsidies and haven’t signed up. Some 8.5 million of that 19 million purchase off-exchange private coverage with their own money, while the other 10.5 million are still uninsured. In other words, for every person who’s allowed to join and has, two people haven’t.
Among this population of the uninsured, HHS reports that half are between the ages of 18 and 34 and nearly two-thirds are in excellent or very good health. The exchanges won’t survive actuarially unless they attract this prime demographic: ObamaCare’s individual mandate penalty and social-justice redistribution are supposed to force these low-cost consumers to buy overpriced policies to cross-subsidize everybody else. No wonder HHS Secretary Sylvia Mathews Burwell said meeting even the downgraded target is “probably pretty challenging.”
That’s not a “challenge” at all, it’s a catastrophe.
The Journal goes on to describe these non-enrolled revenue sources as people who have jobs, but still can’t afford to pay their jacked-up ObamaCare premiums. (Another factor that crops up in conversations with the stubbornly uninsured is that they know much of the cost has been concealed with sky-high out-of-pocket expenses, so even if their direct subsidies make ACA insurance more affordable, they know they can’t afford to actually use it.)
Another conclusion to draw from these incredibly low enrollment numbers is that liberals were dead wrong about the uninsured population, when they pushed fanciful and ever-changing numbers about it through the media between 2008 and 2010. They were always lying about the number of uninsured, and why they lacked insurance. The fundamental premise upon which ObamaCare rests is a fraud. Few frauds have ever been more conclusively disproven… because we’re looking at an uninsured population that thinks paying a hefty fine is preferable to buying an Affordable Care Act policy. They’re actually willing to pay hundreds of dollars to remain uninsured. They’re refusing to buy the first product in American history that was made mandatory.
This will have ramifications far beyond carping on the Sunday morning talk shows. The WSJ describes how the collapse of ObamaCare registrations is causing insurance plans to become unprofitable, resulting in a recent string of providers going belly-up. The Washington Examiner puts it more bluntly, explaining how a few “training wheels” subsidy programs for insurance companies were (very expensively) implemented for the first few years of ObamaCare, to minimize chaos in the insurance markets, but those training wheels are coming off:
Obamacare plans debuted with more expensive premiums than before, but not as expensive as some had expected. This allowed the law’s supporters to assuage public panic over the debacle of 2013 and 2014. Why were prices still relatively low? It’s partly because insurers found other ways to pass costs to consumers — by raising deductibles (the amount customers must pay before the coverage kicks in) and narrowing their supported provider networks. That won’t change, and it is an ongoing source of discontent.
But the Obamacare exchange program itself also gave its participating insurers a set of training wheels for the first few years to allow for such aggressive pricing. Two temporary programs help them limit risk: A government-run reinsurance program, and the “risk corridor” provision, which makes insurers that have fewer losses on medical claims than expected subsidize the insurers that lose more than expected.
With these backstops, insurers took big risks, expecting a bailout. But because few insurers made big money on Obamacare plans, the risk corridor program has only collected about one-eighth of what it would take to pay the full bailout that the losers were expecting. This is part of the reason eight health insurance cooperatives have now folded. Their exit from the market will reduce competition and cause premiums to rise.
Those “risk corridors” were supposed to turn into cash pipelines straight out of taxpayer pockets to the insurance industry, but in one of the distressingly few serious accomplishments of the Republican Congress, the risk corridors were restrained. That’s one of the major reasons those ObamaCare co-ops are dropping like flies.
Another financial problem discussed by Avik Roy at Forbes is the failure of the “Cadillac tax” on supposedly “luxurious” insurance plans to collect as much revenue as anticipated:
CBO and its sister organization, the Joint Committee on Taxation, now estimate that revenues from Obamacare’s “Cadillac tax” on expensive health insurance plans will be $62 billion lower than originally projected during the 2016–2025 time frame. It’s hardly a surprising result. Tax hikes rarely capture the revenue they’re expected to, because businesses and individuals change their behavior in order to avoid the tax. In this case, advocates of the Cadillac tax were hoping that would happen, so as to reduce employers’ incentives to offer excessively padded health benefits instead of conventional wages.
So the only part of ObamaCare working better than expected is the part that kills off good insurance plans people were happy with… and the result is a $62 billion revenue shortfall. Weren’t the Democrats just hyperventilating over the four million dollars spent on the Benghazi investigation? Don’t they bleed out of their ears over how many billions would be “lost” by even the most modest pro-growth tax cut? But $62 billion goes up in smoke because these idiots were wrong about how much cash they could grab with their Cadillac tax, and they shrug.
“There is Obamacare fatigue on the Hill, and no presidential campaign has the issue front and center. But if Republicans can just fight the 2016 health-care battle to a draw, it would represent a huge victory for the GOP,” advises Ed Rogers at the Washington Post.
How come “fatigue” only sets in when a disastrous government program is on the chopping block? No one talked about “fatigue” when Democrats relentlessly attacked pre-ObamaCare private insurance for decades, while one poll after another showed most Americans were happy with their coverage.
The most important thing that changes when the government nationalizes an industry is that its pet media instantly loses interest in complaints from unhappy “customers.” When greedy socialists are eyeing the takeover of an industry, complaints are broadcast loudly, and turned into a fundamental crusade for social justice, neutralizing the majorities who pronounce themselves content with the system by dismissing them as callous and selfish. But once the government takes control of a racket, not even the absurd injustice of young people forking over a thousand bucks a year in fines to avoid buying the government’s crappy product merits moral outrage, and the parade of people mourning the loss of their superior pre-ACA coverage are told to pound sand.
Republicans must score better than a “draw” in 2016 to stave off the even greater ObamaCare disaster to come. This program is immoral, as well as an objective failure. It needs to be destroyed, and Republican candidates should not be shy about collecting testimony from those the media ignores.
Be as relentless, and as strident, as liberals were when they laid siege to what remained of free-market insurance through the Nineties and Aughts. Hold up those dismal enrollment numbers as proof the Left was dead wrong about what ailed health insurance, so it would be madness to continue with their proven-failure “solution.” Reach out to young voters by hammering the absurdity of charging them a huge fine to avoid buying insurance they don’t want… and remind them how those fines will soon get much worse, especially if Democrats decide the best way to keep their precious insurance co-ops floating is to jack up the individual mandate tax even more. Don’t let ObamaCare fester until Democrats can sacrifice it on their dark statist altar to summon something even worse.