American Elephants


Rep. Trey Gowdy Questions Professor Jonathan Gruber by The Elephant's Child

At the House Oversight Committee hearing, Representative Trey Gowdy (R-SC) questions Dr. Jonathan Gruber, professor of economics at MIT, who has become known as an ‘architect’ of the Affordable Care Act. Professor Gruber has become widely known for remarks about the stupidity of Americans, but since Republicans unanimously opposed the Affordable Care Act, his demeaning comments could only be directed at Democrats. He was a major promoter of ObamaCare.



So Who is This Jonathan Gruber Anyway? Everything You Wanted to Know: by The Elephant's Child

It’s quite clear that Dr. Gruber believes the American voter to be terminally stupid, unable to comprehend smart stuff like the Affordable Care Act. He is an economist at MIT, major contributor to the ObamaCare bill, yet unable to craft a law that is anything more than a political stunt, devised to sweep the public, over time, into a disastrous single-payer health-care system that will bankrupt the country and kill off  a lot of its customers earlier than necessary. Let’s face it, it’s lousy health insurance.

The federal government is unable to run a health care plan. Medicare in its current shape is going broke, hastened by the retirement of the Baby Boomers. It must be reformed, but Congress is scared to death to deal with it.  Meanwhile the government deals with it by paying doctors, hospitals and other providers less and less, and fewer and fewer doctors will accept Medicare payments.

Medicaid was meant to be insurance for those who could not afford insurance, and to get all the uninsured — insured. Studies show clearly that the uninsured have better health outcomes than those on Medicaid. Fewer and fewer doctors will see Medicaid patients at all. The Indian Health Service is said to be inferior to Medicaid.

And then there’s the Veterans Administration. The problems have been exposed in one of the Obama administrations worst scandals that has even had deaths among veterans waiting on an endless (probably non-existent) list for care. Wrapped up in fraud and self-serving  and public-sector unions, they can’t even manage to get rid of the people responsible.

You cannot take a medical system that everyone claims costs too much, add a vast bloated government bureaucracy on top, add on unnecessary freebies (like birth control that is extraordinarily cheap and will probably soon be offered over-the-counter) and claim that it will cost less than the free market. Inevitably, under such a system, doctors and hospitals would have to become government employees.

Dr. Gruber has a lot more to answer for than merely calling Americans stupid. It was not the American people who voted it into law, or who were fooled into thinking it was a good thing, but the Democrats in Congress. So the question becomes —just who were the stupid ones?



The Affordable Care Act May Not Be Affordable. Who Knew? by The Elephant's Child

The Health and Human Services inspector general has been busy. Two new audits reveal failures in ObamaCare on an astounding scale. There are unresolved discrepancies, rules violations and technology problems that expose taxpayers to unknown costs.  They bit off more than they could chew.

The HHS inspector general found 2.9 million “inconsistencies” in applications that were submitted to the federal Health Care.gov exchange during the first five months of open enrollment. “Inconsistencies” refers to things like Social Security numbers that don’t match government data, income data, family size, and citizenship that don’t check out. Around 1.3 million of the problems dealt with citizenship. An additional million involved declared income.

The inspector general was unable to resolve these “discrepancies” because the ObamaCare “eligibility was not fully operational.” In other words, who knows if the applicants were eligible to receive ObamaCare at all? Or if they are eligible are they getting the right subsidies? Are they even citizens?

Only 6 million had filled out applications by the end of February, and only 2.6 million had enrolled. Of the 300,000 problems that HHS was capable of resolving, it had only managed to clear up for just 10,000.

Eleven states ran exchanges, and had problems with 34% of the applications they had received — a total of 422,772 problems. They didn’t say if they had resolved any. The federal exchange and two state exchanges didn’t have adequate internal controls to make sure taxpayers were protected from fraud and abuse.

To top that all off, the government hasn’t been reconciling its enrollment numbers with insurance companies to account for dropouts and cancellations. Who knows how many are actually enrolled, or how many people believe they are enrolled and are not? And how many have tried to get coverage to which they are not entitled?

In the private sector, there would be criminal charges and a lot of self-important people would be heading to jail.

The president has changed the law, changed due dates, changed requirement and delayed one thing and another. How that plays out I don’t know. It’s probably one of those —”after the election” things he is so fond of.

If I understand correctly, he has promised the insurance companies that the government would (taxpayers would) bail them out if they came up short. What that means I don’t know.



ObamaCare: Fewer Enrollees, Higher Costs. by The Elephant's Child

The ObamaCare Exchanges are “disappointing” with fewer than 4 million newly insured. The Obama administration had hoped for 26 million. In April, President Obama told the nation that “marketplace” or “exchange” enrollments at 8 million customers as of March 31, had exceeded expectations and were lower than expected. The media blithely accepted the “selectively released statistics”, in spite of the administration’s habit of providing incomplete information.

The White House has not released any enrollment figures in the last 2½ months, nor do they plan to issue any updates soon. Hmmn. Government numbers included 20 percent of enrollees who did not pay their premiums. Estimates of how many were previously uninsured range from about one-third to more than half. Some who were forced out of their existing coverage find themselves having to re-enroll at much higher rates than before.

Some insurers have increased their rates by 35 percent to bring their rates into compliance with ObamaCare. So you have people with (perhaps) more benefits but for 35% more premium.

Coverage expansion in the ACA are estimated to increase federal spending by $1.383 trillion over the next two decades. Economist Greg Mankiw has estimated that the ACA or ObamaCare will reduce long run GDP in the U.S. by 5%. He insists that it is a rough estimate. University of Chicago economist Casey Mulligan says the Affordable Care Act added “about six percentage points to the marginal tax rate faced, on average, by workers in the economy. A useful rule of thumb is that taxation of $1 means that 20¢ of economic activity just never takes place.

Rates will increase significantly for next year. ObamaCare, as expected, is going to cost way more than it was planned to cost.



Health Care Costs Rose 10% In The First Quarter! by The Elephant's Child

Back in May of 2009, President Barack Obama had a big health care announcement, flanked by the heads of several major health lobbying groups: The American Hospital Association, the American Medical Association, The Pharmaceutical Research and Manufacturers of America, the Medical Device manufacturers, and the health care worker unions.

The President announced:

T]hese groups are coming together to make an unprecedented commitment. Over the next 10 years — from 2010 to 2019 — they are pledging to cut the rate of growth of national health care spending by 1.5 percentage points each year — an amount that’s equal to over $2 trillion.

The providers group said:

We will do our part to achieve your Administration’s goal of decreasing by 1.5 percentage points the annual health care spending growth rate — saving $2 trillion or more. … To respond to this challenge, we are developing consensus proposals to reduce the rate of increase in future health and insurance costs through changes made in all sectors of the health care system.

They are developing proposals about the way they might come up with a plan to cut the rate of growth of health care spending, but they don’t yet have a plan, or any idea how they could cut costs. But the cost curve was already heading down and had been for 7 years, slowing only when Democrats devised the Affordable Care Act.

Didn’t work out so well, health care costs rose by nearly 10 percent in the first quarter according to the Bureau of Economic Analysis. In 2013, costs rose only 2.4 percent.

“The rise in costs and rate of growth calls into question claims from supporters of the federal health care law, including President Obama, who claimed Obamacare would “bend the cost curve” and slow down the rate of growth in health care spending. Obama and Obamacare supporters have been trumpeting, for instance, their exceeding a goal of signing up nearly 8 million enrollees on health insurance plans by way of the laws provisions.

Over the longer term, what does track with the declining growth rate is the growth of Health Savings Accounts (HSAs), the growth in Health Reimbursement Accounts (HRAs) and the general trend toward higher deductibles. When health insurance was first offered during World War II, because wage controls prevented raises, companies offered health insurance as a way to attract workers. When health care is paid for entirely by insurance the incentive is to use more of it — and so it was. HSAs have a high deductible, but lower premiums, and the incentive is to use less of it. You don’t go see the doctor for a cold. And your savings can be rolled over tax-free from  year to year, and are there for future health care expenses.

HSAs were created by legislation in 2003. Participation in HSAs has been growing by double digits every year since than. They grew by 22% in 2012. There has been parallel growth in HRA plans, a similar plan offered by some large employers.

Republicans were inclined to wonder how Obama was going to make it all cost less while adding a huge government bureaucracy on top to administer it.

Charles Blahouse of the Mercatus Center says:

It is quite possible that the ACA is shaping up as the greatest act of fiscal irresponsibility ever committed by federal legislators. Nothing immediately comes to mind as comparable to it. …The ACA is a commitment to permanently subsidize comprehensive health insurance for millions who could not otherwise afford it, which the federal government has no viable plan to finance.

Sowell



“If You Like Your Job…” ObamaCare Will Increase Unemployment by The Elephant's Child

The Congressional Budget Office says that ObamaCare will increase unemployment. There are 7.8 million Americans working part-time who want full-time work. Mr. Obama changed the subject to raising the minimum wage.

On Tuesday no less than the Congressional Budget Office reported that the health law is causing Americans to work less or not at all, in a remarkable intellectual turnabout for the budget shop that Democrats cited repeatedly when selling ObamaCare. Now CBO—full of liberal-leaning economists—says the economy will lose the equivalent of two million full-time workers by 2017 and 2.5 million over the next decade, a threefold increase over its prior estimate.

ObamaCare’s complex design includes new subsidies, new taxes and new mandates. For low wage, lower-skilled or discouraged workers ObamaCare offers incentives that can force them to trade jobs for entitlement benefits. The CBO concludes that ObamaCare will encourage people to supply less labor by working fewer hours to qualify for more benefits. The incentives suggest watching carefully the overtime, a promotion or training in hopes of higher future earnings — it might boost you into another category with less or no subsidy. The question becomes how many people can the nation support on entitlements? I thought the numbers were already too high.

The CBO’s job-loss prediction doe not include the impact of ObamaCare’s employer mandate, which requires businesses with 50 or more full-time employees to offer insurance or pay a $2,000 penalty for each worker beyond 30 employees. The mandate has been delayed by executive order for a year. so it won’t take effect till 2015, which probably means the CBO is vastly underestimating job losses.

The White House, of course, denies everything. “Claims that the Affordable Care Act hurts jobs are simply belied by the facts in the CBO report,” the White House, in the person of Jay Carney, declared. The White House seems to mean that the report is positive because”individuals will be empowered to make choices about their own lives and livelihoods” and “have the opportunity to pursue their dreams.” Didn’t Nancy Pelosi suggest that they would have more time to do art or crafts or maybe music?

Incentives matter. People respond to incentives. And there’s nothing in the act that encourages businesses to hire more workers and be more competitive. Like “if you like your doctor,” it may include “If you like your  job…” The law is a job destroyer that is taking away rungs from the ladder of upward economic mobility.



Finally, Someone in The Media Fesses Up! It’s Not Affordable. by The Elephant's Child

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USA Today passed out a nugget of truth as a Boxing Day Gift:

More than half of the counties in 34 states using the federal health insurance exchange lack even a bronze plan that’s affordable — by the government’s own definition — for 40-year-old couples who make just a little too much for financial assistance, a USA TODAY analysis shows.

Many of these counties are in rural, less populous areas that already had limited choice and pricey plans, but many others are heavily populated, such as Bergen County, N.J., and Philadelphia and Milwaukee counties.

More than a third don’t offer an affordable plan in the four tiers of coverage known as bronze, silver, gold or platinum for people buying individual plans who are 50 or older and ineligible for subsidies. …

The prices of exchange plans have shocked many shoppers, especially those who had plans canceled because they did not meet the ACA coverage requirements. But experts are not surprised.

“The ACA was not designed to reduce costs or, the law’s name notwithstanding, to make health insurance coverage affordable for the vast majority of Americans,” says health care consultant Kip Piper, a former government and insurance industry official. “The law uses taxpayer dollars to lower costs for the low-income uninsured but it also increases costs overall and shifts costs within the marketplace.”

The law’s name notwithstanding! That’s why we call it “ObamaCare” not the Affordable Care Act.




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