Here Are 58,000 ObamaCare Harms That Can’t be Repealed or Delayed
Although the Obama administration has decided to help businesses by delaying the set of burdensome reporting requirements that will theoretically prevent the IRS from levying fines on firms that fail to provide affordable coverage, ObamaCare officials continue to back regulations that harm individuals.
Saying that it has “become more difficult to administer these plans in a cost-effective way for our members” the Los Angeles Times reports that UnitedHealthCare will join Aetna in pulling out of California’s individual health insurance market. An estimated 58,000 people will have their policies canceled.
If these policies were grandfathered, it is unlikely that the people who were insured will be able to replace them. Higher deductibles mean lower premiums, and according to a nationwide 2009 survey by America’s Health Insurance Plans, over a third of individuals and families with individual coverage had chosen deductibles above the ObamaCare limits of $2,000 for individuals and $4,000 for families. For them, the new ObamaCare compliant plans may offer more limited networks and higher costs. They also require that health insurance be used to purchase items, like glasses for children, which are less expensive when purchased with cash.
This is only the beginning. In the next few months millions of health insurance policy holders may receive news that their policies fail to meet ObamaCare’s minimum benefit standards. If their incomes are low enough, they will likely look to the state health benefits exchanges for subsidized policies that let them avoid ObamaCare’s onerous fines. But they are eligible for subsidies only if their employer fails to offer affordable coverage. Thanks to the delay in business reporting, there is now no way to know that. And, as John Goodman has pointed out, it was unlikely that the exchanges would be ready even before this particular monkey wrench was thrown into the works.
Although ObamaCare supporters have allowed modifications of ObamaCare policies that obviously harm businesses, the repeal of the 1099 reporting rules and the delayed business reporting on health coverage come immediately to mind, they are curiously unconcerned with the harm done to individuals. When asked for a comment on the fact that 58,000 people will lose their individual health insurance policies, Sabrina Corlette, a research professor at Georgetown University’s Center on Health Insurance Reforms, told the Times that:
The business model of health insurance is fundamentally changing and some companies are willing and able to adapt…Given the limited market share those carriers had, UnitedHealth and Aetna have made the calculation that it required too much of an investment to change their strategy in California.
Ms. Corlette might as well have said “We’ve changed the rules of the game. Some entities might get relief, but people who had individual policies in California will simply have to be content with getting their coverage from WellPoint or Kaiser or through the state exchange. And those who now have to pay a whole lot more because they’ve lost a grandfathered policy must understand that one can’t make an omelet without breaking eggs.”
“But they are eligible for subsidies only if their employer fails to offer affordable coverage. Thanks to the delay in business reporting, there is now no way to know that”
I’m curious how they will get around this
The IRS will also find it difficult to verify if individuals have insurace
Not exactly. “At the end of the year, insurers must provide the IRS and policyholders a form verifying coverage status, and individuals must include those forms with their federal tax return.”
http://money.cnn.com/2013/05/28/pf/taxes/irs-health-reform/index.html
Excellent article very informative.
They won’t. Unless they make massive changes, which will never get through the House.
On Friday they announced that they will use the “honor system.” In essence, if you say that you are eligible for a subsidy, you will get one.
So basically, if you don’t want to make the employee contribution required for a family on your company health plan, you go to the exchange, lie about your income and get nearly free health coverage worth, say, $15,000.
When the IRS discovers your subsidy was more than you were eligible for, you say “I forgot” as the excuse for not knowing your actual income. The IRS claws back only a few hundred bucks and your employer pays a $3,000 fine.
Somehow this doesn’t reassure me this system will work.
The Obama administration is slowly reeling back it’s Obamacare regulation, and I would be surprise if by the next election the entire program is canceled
I am not sure that it will be canceled, but it might become a voluntary program, and revert back to a more complex version of Medicare.
True. Among many things by the Obama Admin that will all be cancelled.
This an extremely important matter, why aren’t republican congressmen armed with this type of info on the way into meetings about Obamacare regulation?
How many from either party read the entire bill? How many even had time before the democrats rushed it through knowing they would be kicked out of the house in 2011?
The closer we get to implementation, the more angry I become. If the Busybodies who wanted ObamaCare believed everyone should have health coverage, why on Earth didn’t they merely mandate high-deductible plans? Taxpayers, employers and our grandchildren cannot afford the exorbitant subsidies that will be required to provide Cadillac Coverage for All.
If DoGooders were worried about the sick not having access to affordable coverage, they could have required regulations like guaranteed issue and community rating in the individual market for, say, $5,000 deductible plans. Insurers would not have been as hesitant (and insurance markets not as distorted) by these regulations if they only applied to high-deductible plans.
It is going to be a wild west. I think there will be another announcement as it relates to state based exchanges vs federal based exchanges. I think the Federal Based exchanges will be delayed.
I also think CA is on a course for disaster with the exchange. Bankrupt in a couple years and carriers will pull off the exchange.
This adds to the 49,000 policies Aetna currently underwrites that will also be cancelled at the end of the year.