Understanding Obamacare – Part 2

In my previous blog, I explained, from my understanding, how the stage was set for people to be receptive to the idea of National Health Care. (See Understanding Obamacare - Part I.)

Now that it has become the law and subsequently passed muster under the inspection of the Supreme Court, what’s so bad about it? There are three effects (that I’ve learned – probably more as time goes on) that Americans will come to appreciate. Obamacare is not really affordable; Obamacare will eventually dictate the level of health care Americans can obtain; and Obamacare, by design, punishes the heart of our economy – small businesses. This entry addresses my thesis that Obamacare is not affordable to those who are uninsured.

Obamacare is Not Really Affordable

Sadly, most Americans are gullible when it comes to campaign promises. If a politician and his campaigners repeat the same promise enough times, and it “tickles the ears” of the listeners – meaning they want the promise to be true – the audience will simply accept the promise without questioning the probability or likelihood of that promise being fulfilled. This becomes doubly true when the mainstream media fails to fulfill its role of examining and investigating, and then reporting the facts. Complex issues require an unraveling and explanation in terms with which “Everyman” can grapple. If the media is not going to help us do our homework, most people are simply going to trust the promise – regardless of its inherent failings and lack of logic. In the case of Obamacare, mainstream media played the role of assisting the campaign rather than helping voters examine the facts.

Obamacare was labeled “The Affordable Health Care Act.” Affordable truly is a relative term. Implied is the notion that people who are not insured by a health care plan are in that position because they cannot afford the premiums. Contrarily, those who have health care can afford it. So really, we’re talking about people who, after paying housing, food, car insurance, utilities, and basic necessities do not have the financial ability to come up with the dollars to pay for health insurance premiums. They truly cannot afford it. So Obamacare to the rescue – his plan will be affordable. Right?

Well, let’s look at some sample premiums for obtaining health care under the Affordable Health Care Act. I live in Oregon, so I’m using the Oregon Health Authority Member Handbook, which provides premiums for both the Oregon plan in addition to the Federal plan premiums. Presently the Federal plan does not provide pricing for families – only individuals. So, I’ll use my situation as the first example to discover what Obama’s Affordable Health Care cost for me. I’m 58 and my wife is 57. We’ll go with the less expensive of the two plans offered, which is a $750 deductible (meaning, the insured pays the first $750 before the insurance starts paying). Both my wife and I are in the “Age 55-59” bracket. My son, who is 18, is still a dependent, so I need to factor him in as well. He fits into the “18-19” year-old bracket. Okay, so here goes: For me, the monthly premium would be $742, for my wife, also $742, and for my son - $295. In sum, our monthly affordable premium would be $1779.00. But remember, insurance doesn’t kick in until each of us pays, out-of-pocket, $750 to meet our deductible. So, $750 x 3 (deductibles x members of family) = $2250. If we divide that by 12, we arrive at what we’ll need to plan per month to meet that deductible: $2250 / 12 = $187.50. Now, we add in the deductible to the premium to determine what the actual monthly cost is for health care (not counting co-pays): $1779 + 187.50 = $1966.50 per month. That’s my AFFORDABLE health care.

Okay, okay, I’m an old guy. What about a younger person? One of my daughters is a single 26 year-old with no children. Her affordable health care is only $355.00 per month. Oh, before the $750 deductible. So, it’s really $417.50 per month. So, I’m sure she’ll think that is pretty cheap.

And then, I have a daughter who is a single mom with three children. She’s in the “30-34” bracket, so that’s only $396 per month. Her three children are in the “0-17” bracket, and they are just $262 per month. With four deductibles to plan on paying for, that’s 750 x 4 = 3000 / 12 = $250 per month. Thus, 396 + 262 + 262 + 262 + 250 = $1432.00 per month. Gosh, that seems really affordable for a single mom of three children.

Now, if you are wealthy, these premiums might not seem out of line. But remember, the Affordable Health Care Act was supposed to address the needs of those who could not obtain health care through traditional insurance. Going back to my example, I work, my wife works, and my son is going to college. Guess what? There is no way in the world we can afford almost $2000 per month for government health care.

My single daughter is just starting out a career as a hair stylist and esthetician. Whether she’ll have $420 available on a monthly basis just starting out, is yet to be determined.

My daughter who is a single mom of three small children? After paying for rent, food, college loans, IRS back taxes, clothing, car insurance, daycare, etc – do you honestly think she’ll have over $1400 left to pay for health care?

But wait. Some of my readers might be saying that those premiums are going to change in 2014 when the new Cost-Sharing Credits take effect. Granted, there are publications on the web that promise much lower premiums in 2014. Yep… you can find those all right. Realistically, how is that going to happen? How will premiums suddenly go down without the real cost of medical care being transferred elsewhere. I mean, why will future rates be dramatically lower? Are medical costs going up or down? Even if they were to remain stable, how would premiums for those on the government plan go down substantially? There are only three possible answers: 1) the real cost would be shifted elsewhere, meaning others would subsidize the real cost of government health care – as in a federal pool that would be shared by private insurance companies resulting in higher premiums for those who have private insurance; 2) taxes would be raised substantially to pay for government health care – just like for Social Security (which is insolvent and in danger of imminent collapse); or 3) it’s just not possible, but once again, politicians will promise the impossible, which is accepted by people who want “their ears tickled.” Once again, my dad’s lessons to me bear repeating: Money doesn’t grow on trees, and If something sounds too good to be true, it’s probably because it is too good to be true.

I’m sorry to be a “killjoy.” I’d love there to be some magic fairy dust to provide health care for all humans at a really affordable price. But there is reality with which to deal. Most Americans live on a month-to-month basis. Unlike members of Congress and the President who have a lifetime Cadillac health care plan included in their job description, the average American is trying to figure out how to pay $3 to $4 per gallon of gas to commute to work, or look for a job. Most are figuring out how to continue paying for house payments and maybe, college for their kid. It’s not that responsible people expect the government to give them health care on a platter. It’s that they are being told that health care is a mandate. Buy it or else. Or else what? Or else they’ll pay a fine. Oh wait… the Supreme Court has clarified that point. It’s not a fine, it’s a tax. A tax that Obama promised it was not.

In my next blog, I’ll address how I believe Obamacare will dictate what health care Americans will be able to access.

Understanding Obamacare - Part 1

Understanding Obamacare, for me, has come incrementally. I must admit, that while I opposed it from the beginning, my disdain was somewhat akin to meeting a huge adversary in a dark alley, knowing instinctively he was armed and dangerous, but knowing very little about his identity. And that’s the way the President and the supporters in Congress wanted it. I don’t say that lightly; it was the Speaker of the House, Nancy Pelosi, who announced we’d have to pass the 2600 page bill and THEN find out. Like the Stimulus Bill of 2008, the public was told that matters were so urgent that there was no time to delay. Trust us. And how crafty to set a timeline of “implementing” the law by 2013, thus masking its overwhelming effects until after the 2012 election.

To the credit of many “Paul Reveres,” the call of alarm and to arms occurred before the legislation was passed and since then. But the Administration, supporters of Obamacare, and the mainstream media have successfully branded those voices as that of Chicken Little claiming the sky is falling.

Before digging into the danger of our current National Health Care law, I think it’s important to review how the stage was set for accepting it. If it’s SO bad, why was there any acceptance for its proposal?

From the start, I understood the inherent workings of insurance, and despite not liking to pay high premiums myself, understood, that if our society was to become increasingly dependent on a) not having a major medical deductible that must be borne by the insured before his insurance kicked in, and b) we, as a society, were going to continue to subsidize the cost of paying for people who do not contribute, people who practiced lifestyles that led to diseases that could only be slowed, not cured (such as AIDS), and people who ran to the doctor at the drop a hat because with such a small co-pay, it was considered commonplace to do so – well, as my dad used to say, “Money doesn’t grow on trees,” and sooner or later, we have to face the music.

If a sizeable number of people do not contribute to the system, others will have to pick up the tab. Doctors, clinics, and hospitals are still going to provide the service, but they expect to get paid because they have bills to pay and mouths to feed. So, to offset the loss, they place that loss upon the people who are paying. It’s just like when stores lose merchandise to theft; they don’t just say, “Oh well, I guess we’ll have to go out of business.” They increase the prices on the remaining merchandise to make up for the loss. And the honest customers end up paying higher prices.

When people who “enjoy” multiple sex partners finally contract HIV which at some point becomes full-blown AIDS and thus needs treatment exceeding $600,000 (ABC News) – that they don’t have – but they still get the treatment – the care providers are not going to be “compassionate” to the tune of firing their doctors and staff because they didn’t get the money. Again, people who pay for insurance are going to be looking at much steeper premiums because the unpaid bills are going to be transferred to those who pay. Same with all the teenage pregnancies. Same with the drug users who need extensive rehabilitation and nobody has the right to tell them what they can and cannot do. Same with providing abortions. Same with… Same with…

And that experiment we have been trying based on HMOs, Health Maintenance Organizations… Before the days of “maintenance” health, people paid a big, fat deductible under a Major Medical Plan (some still do, and many are going back to it.) But with health maintenance, the public became trained to run to the doctor at the first sighting of something being wrong – with the idea being that it would be cheaper to pay for prevention and early intervention than allowing an illness to get out of hand. But by encouraging people to do so, offering full benefits with very small co-payments, the plan inadvertently led to people thinking they had to go to the doctor for everything and anything. And many did. Then, when the doctors billed the insurance companies, the companies realizing that there was only so much money they had collected on premiums, had to increasingly cut back on what they would pay the health providers for services rendered. (And this is tenfold true of Medicare and Medicaid.) The providers based their budget on actual costs, but were getting short-changed. How would they make it financially? Why, they’d have to increase their prices. And the insurance companies had based their budget on what they projected the claims would be, but had underestimated the insured’s increased trips to the doctors and expectations for inexpensive treatment. Whoops. How would the stay afloat? Oh, that’s right, they’d have to increase their premiums.

And so, people like Obama, Pelosi, and everyone who hates the reality of economics, capitalized on this situation, and attacked insurance companies, attacked medical providers, attacked pharmaceutical companies, etc, and set out to convince the public that the real culprit in this was corporate greed. And 50% of America was happy to get on that bandwagon. It is much easier to blame others than look in the mirror and take responsibility for our own indulgences. When an issue can be removed from local and basic understanding, it becomes easy to think that money does grow on trees. In other words, if we simplified the dilemma, we’d understand that if John and Joe go out to dinner, and Joe won’t pay, John’s bill is going to be a lot higher and the restaurant isn’t going to just say, “Oh well, that’s okay, you don’t have to pay.” And if John and Joe skip out on their bill when the waitress isn’t looking, the restaurant will have to raise their prices on the honest customers. It’s basic. But take the issue up to the national level where the problem is spread across 50 states, countless private organizations, and over 300 million people, it’s become an attack that sounds like this: “Joe is a victim of his circumstances, but he is still entitled to eat in the restaurant – just like John. John isn’t paying his fair share – he’s rich, did nothing to deserve it, and John is expected to pay for Joe. And the restaurant owner? He’s greedy! Why should he be allowed to charge so much for his food?”

My dad also taught me “If something sounds too good to be true, it’s most likely because, in fact, it’s too good to be true.” The Bible says that another way in 2 Timothy 2:3,4 “For the time will come when they will not endure sound doctrine; but wanting to have their ears tickled, they will accumulate for themselves teachers in accordance to their own desires, and will turn away their ears from the truth and will turn aside to myths.” Despite the logic of having to pay for the actual cost of services, we really do want something for nothing. Out of compassion, we want a person, regardless of his choices in life, to receive the very best care and give that person a chance for recovery, survival, and high standard of care. Granted, you as an individual cannot afford to pick up the tab by yourself, but if the whole nation chipped in… Well, the whole nation isn’t chipping in. The number of chippers is getting smaller and smaller and smaller, and their tab is getting larger and larger and larger. In other words, the number of Joes is increasing, and the number of Johns is decreasing. The owner of the restaurant is having to raise his prices because fewer Johns are going out to dinner. The restaurant is on the verge of going out of business because customers think his prices are outrageous. Meanwhile, Obama and his supporters are convincing as many people as possible that a) every Joe deserves to eat at the restaurant – not just the Johns, b) John is selfish and must be forced to pay for Joe, and c) the greedy restaurant owner is the real problem, and therefore, we need a government restaurant that will provide affordable meals for all. (And if you choose not to eat at either the government restaurant, or at that greedy expensive restaurant), you’ll have to pay a fine – oh, the Supreme Court clarified that, yes, it is indeed a TAX – for not eating.)

In my next blog, I will go more into the danger of the Affordable Health Plan, aka Obamacare, at least to the extent I’m understanding it. Thank you for reading. Oh, and my apologies to anyone out there whose name is Joe.

Let's Pretend We're A Family

When one is not directly confronted with a national issue day in and day out, it's easy to lose sight of common sense, get caught up in philosophical arguments, and throw up your hands. Most seemingly complicated politic arguments should be reduced to analysis in the setting of a family.

Let's say, your family comes home from a vacation to find a group of strangers in your living room. You ascertain that they are not violent or an immediate threat to your safety. When you ask how they got in, they admit that a hired hand brought them to your house, picked the lock, and let them in.

They explain that the last neighborhood they lived in made it almost impossible to support themselves. There were few jobs, poor schools, and food was hard to come by. When these strangers heard that you had plenty of food, income, and health care, they decided to move into your house.

In your refrigerator, they found plenty of food and felt totally satisfied. The steaks you had been saving for a special occasion had been consumed, as well as the ice cream that was supposed to be tonight's treat. One of the strangers had badly injured her leg and taken the remaining antibiotics and Vicodin you had left behind from your trip. The strangers said they would happily move into the garage or backyard and let you keep your bedrooms.

The strangers did have a few demands though. They made it clear that they would need you to add them to your health plan and pay the premiums for them. If not, you'd eventually end up paying anyway because they'd have to go to the ER for things like the flu, bee stings, cuts, and as they wouldn't have the means to pay, they'd have the billing passed on to you. Also, until they could find suitable jobs to buy their own place, they'd need you to provide them food, toiletries, cosmetics, car insurance (if you're not willing to get their car insurance, again, they'll just have any accidents passed on to you), and over the counter pharmaceuticals.

Now what I didn't clarify at the beginning is that all of this is being communicated by an interpreter for whom you will be expected to pay, as the strangers don't speak your language. They make it clear that they are not willing to learn it either. From now on, all communication in your house has to occur in both your language and theirs. And incidentally, they will need you to pay for special instruction for their children - in their native language. Oh, and they almost forgot: your children will not be allowed to progress at an educational rate they are capable of achieving. See, that would put your children ahead, and leave their children behind - at a social disadvantage. So until their children catch up, you need to get an extra job to pay for special programs for their children while yours are kept from moving too far ahead.

Questions
1. Is it cruel to tell the strangers that your income is dedicated to your family and that you cannot afford to maintain your standard of living and pay for the strangers to have the same?
2. Do you have the right to tell these people to leave?
3. Do you have the right to expect the law enforcers - who are paid with your tax dollars - to remove these people, and arrest them if they resist.
4. Do the law enforcers have the right to see their identification?
5. If the strangers break in a second time, should the law enforcers do something more dramatic than simply take them back to their old neighborhood and let them go again?

In my book, this is not a complex problem. Simply ask yourself what would you consider fair if this was a daily occurrence in your own home, and there you are. And by the way, it is happening in your own home. It's called America.

And the answer is... NO!

Well, the response to support sought for the Vietnam Mission's trip was a resounding "NO." I mean a big NO. Put it this way, I didn't even have to return any donations to donors due to my not going. That is to say, no one donated. So if you never considered donating, or considered it but decided not to, or couldn't afford to - you're in good company.


The money I had saved for the trip went to my church - designated for the heating and air conditioning system that has gone belly up. So, it's all good.