Putting the Pieces Together in Destroying Private Health Insurance

13 Jan 2014

I will be putting a couple of article together for this post to see if we can read what may happen down the road with ObamaCare and insurance companies.

Robert Laszewski — a prominent consultant to health insurance companies – wrote this blog post last week.

Will There Be an Obamacare Death Spiral in 2015? No – Health Care Policy and Marketplace Review

Obamacare contains a $25 billion federal risk fund set up to benefit health insurance companies selling coverage on the state and federal health insurance exchanges as well as in the small group (less than 50 workers) market. The fund lasts only three years: 2014, 2015, and 2016.

Of the $25 billion, $20 billion is earmarked for the Reinsurance Program and $5 billion goes to the U.S. treasury.

The statute very specifically limits funds collected to $25 billion over the three years––$12 billion in 2014. The source of these funds is the Obamacare $63 annual “Belly Button Tax” assessed on almost all people covered under a health insurance plan.

So this tells me that health insurance companies will operate risk free for three years under current law. The tax payers are insuring the health insurance companies from loss of revenue due to ObamaCare. Seems ironic – we are insuring the insurers.

Let me quote from the another article from linked here.

Bailing Out Health Insurers and Helping Obamacare – Weekly Standard

In other words, insurance purchased through Obamacare’s government-run exchanges isn’t even full-fledged private insurance; rather, it’s a sort of private-public hybrid. Private insurance companies pay for costs below $45,000, then taxpayers generously pick up the tab—a tab that their president hasn’t ever bothered to tell them he has opened up on their behalf—for four-fifths of the next $200,000-plus worth of costs. In this way, and so many others, Obamacare takes a major step toward the government monopoly over American medicine (“single payer”) that liberals drool about in their sleep.

While the previous post makes it seem as though ObamaCare provides insurance for the insurers, it is actually insuring people indirectly through these health insurance companies – FOR THREE YEARS.

Let me put it this way. Years ago we had gas company mergers. One of them was Exxon buying Mobil. So although Mobil gas stations and products still existed for a time after Exxon bought them – they were really Exxon. The same thing is occurring with health insurance. The government, using tax payer money, is buying health insurance companies on a three year buy out program.

What happens after three years? The fine schedule for not having health insurance will have changed. Right now it’s cheaper to pay the fine than to have insurance. Human nature says, if money is short, I will pay the fine. In 2016, it will be cheaper to have insurance than to pay the fine. But the government, after 2016, will no longer prop up the health insurance companies – and they will have to adjust their rates higher to stay afloat. The government will be in a position to totally undercut the rates from health insurance companies.

So to answer the blog title from the first link… the death spiral occurs not in 2015, but in 2017 when the government stops propping up these companies.  ObamaCare is a devious plan to wipe out health insurance companies in 2017 and takeover the health care system. This is not the design of the American government.


Obama Pressure Republicans to Increase Unemployment Benefiits

7 Jan 2014

Obama pressures Republicans to extend unemployment benefits – Washington Examiner

President Obama on Tuesday called on Republicans to extend unemployment benefits to 1.3 million Americans for three months, looking to build momentum for the federal aid after the measure cleared a major hurdle in the Senate.

“We’ve got to get this across the finish line without obstruction or delay, and we need the House of Representatives to be able to vote for this as well,” Obama said from the East Room of the White House, surrounded by Americans who lost unemployment benefits in late December.

The Obama administration estimates that failing to extend unemployment beyond 26 weeks would cost the economy roughly 240,000 jobs. But some Republicans counter that extending such benefits would keep Americans perpetually unemployed and limit their motivation to return to the workforce.

So here we are again with another government finance crisis. To have crisis after crisis that are only solved with temporary “fixes” is insanity from a problem solving perspective. From a political perspective, it does give the President and Democrats more opportunities to make Republicans look heartless. The latter is obviously the goal here.

There is a problem with the last paragraph quoted above – it’s not true. The logic behind that statement implies that if we put money in the hands of the unemployed, they will spend it and therefore businesses will have income to keep jobs. Here’s the problem. The money that the unemployed receive is recycled money – it comes from taxes paid from people who are working. In other words, we are simply shifting around money at this point from those who are working to those who are not working. So yes, unemployed people can buy more, but people who are employed and pay taxes will buy less. There is no net benefit.

At some point, we need to add in the ability to produce more money – but right now, there are numerous regulations that hinder manufacturing and production. But if we want to shift money around, I suggest shifting money away from the federal government towards the private sector. We are much better at using money than the federal government.

100+ Former New York City Workers Charged with Disability Fraud

7 Jan 2014

Part of our nation’s financial problems are because of stuff like this. There are so many laws and entitlements that people in government can’t keep up with the fraud.

Over 100 NYC workers charged in disability scam – AP

A law enforcement official says more than 100 current and former city workers, including dozens of police officers and firefighters, are being charged with faking psychiatric problems in order to get federal disability benefits.

The official says the scam stretched back more than two decades, with the ex-officers and other workers claiming mental health problems so severe that they couldn’t work at all.

Official: More than 100 NYC police and firefighters indicted in PTSD scam – CNN

…more than half the recipients receiving fraudulent funds from 9/11 post-traumatic stress disorder disability claims, …

The individuals received $50,000 a year on average because, they claimed, they were no longer able to work, according to the source. Many of the claims allegedly involved work-related trauma caused by the 9/11 terror attacks.

Chief Justice Denies Groups Attempt to Block ObamaCare

7 Jan 2014

The Association of American Physicians & Surgeons, Inc. and the Alliance for Natural Health USA attempted to block implementation of the nation’s new health care law.

John Roberts refuses to grant Obamacare emergency stay – Washington Examiner

They asked the chief justice Friday to temporarily block the law, saying Congress had passed it incorrectly by starting it in the Senate instead of the House. Revenue-raising bills are supposed to originate in the lower chamber. They also wanted blocked doctor registration requirements they say will make it harder for independent non-Medicare physicians to treat Medicare-eligible patients.