American Elephants

Premiums Up. Costs Up. Government Control Up. Consumer Confidence Way Down. by The Elephant's Child

Consumers are, about now, receiving the bad news about their health care premiums.  They are going up, and in many cases going up very significantly.  Naive members of Congress believe that just because something would be “nice” that writing it into law would be a fine idea.  The Law of Unintended Consequences simply says that the actions of people — especially  people in government — often have effects that are unanticipated or unintended.

Because Democrats are reluctant to rely on the evidence of the experience of others, or to  look  at studies and scholarly investigations with care, they get socked with unintended consequences more often than Republicans do, but Republicans have their share as well. Democrats can be depended on to rail against evil insurance companies without any understanding that issuing health insurance policies  is a business. The  Health Care Plans business ranks #86 by profit margin,  at 3.3%.  There are 85 industries more profitable than health care plans which includes companies like Cigna, Aetna, Well Point, etc.

So why will insurance costs go up?  1) Mandated Benefits. The CBO estimates that the benefit mandates in ObamaCare will increase premiums 27-30 percent in the individual market and up to 3% in the small group market.

2) Preventive Services. No cost sharing. Preventive care is likely to increase costs, and do little to improve health outcomes.

3) Minimal Discount for the Young and Healthy. Estimated premiums for those 18-14 will rise by 45 percent, 36 percent for those age 25-59 and 26 percent for those age 30-34.

4) Limits on Cost Sharing and Deductibles.  Means that individuals have little incentive to economize on their use of health care services.  The CBO says a 10% decrease in cost sharing increases spending by 1-2 percent.

5) Elimination of Good Health Discount.  In order to keep costs down for older folks, young healthy people will have to pay a larger share.

6) Taxes on Insurers, Pharmaceutical Companies and Medical Device Makers.  These taxes will all be passed on to consumers, increasing premiums by 2.5 % or more.

These are only a few of the many unintended consequences that will raise costs to consumers. Common sense will tell you why they will kick in.  The authors of the bill seemed to think that making lots of tests free for patients would catch potential disease in the early stages, but lab tests and scans are very expensive, and usually ordered by a doctor in  response to a symptom.  A lot of tests on perfectly healthy people will not turn up much disease.

The mandates for everyone to buy insurance depend on the young and healthy bearing much of the cost for those not quite so young and not quite so healthy.  ObamaCare also relies heavily on the idea that there are “best practices” that can be chosen by bureaucrats that all doctors must follow.  This demonstrates a complete lack of understanding of the doctor-patient relationship.

When you get down to the most basic ideas behind this whole thing, you find an arrogant belief that the elite in Washington know better than you do, and can, with enough regulation of doctors and hospitals and providers of all sorts make health care cost less. Most doctors will not accept Medicaid patients, and drastic cuts in Medicare payments suggest that Medicare will soon follow.

My sense of the whole thing is that it will fail in a fairly short time span if it is not repealed.  Perhaps I am overly cynical, but I am familiar with the evidence from other countries. We have had the best health care system in the world.  Costs have risen unnecessarily because of government interference in the marketplace.

The members of Congress who had a hand in writing this 2,409 page monstrosity have a lot to answer for.  We should get rid of the lot of them this next week.

“Call Me Senator” by The Elephant's Child

From Director David Zucker of “Airplane ” fame.  There are so many funny videos coming out.  Enlarge it to full-screen to enjoy the video to the utmost.

David Zucker watched the news reports of Barbara Boxer’s Senate hearing and was offended at the way Senator Boxer treated an Officer in  the United States Military, who deserves all our respect.  He sat down immediately and wrote this skit.  The world has changed.  Barney Frank can claim all he wants that he “always thought that low-income people should be encouraged to rent”, but his long and vigorous support for getting more people into their own houses is recorded on You Tube videos for all time.  You just can’t get away with as much as you used to.

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