The front page of today’s New York times has an article written by Roni Caryn Rabin and Reed Abelson that states that premiums will “be at least 50% lower on average than those currently available in New York“. To what do they contribute this miraculous drop in premiums? That’s right, the miraculous premium reducing powers of Obamacare!
The authors quote Joanne Peters, a spokeswoman for the Department of Health and Human Services as saying “We’re seeing in New York what we’ve seen in other states like California and Oregon — that competition and transparency in the marketplaces are leading to affordable and new choices for families.” Even Forbes magazine’s Rick Ungar now knows that premiums are not really going to drop in California because of Obamacare. Most especially after his counterpart at Forbes Avik Roy accurately blew up that fallacy in his fact based response to Rick’s article entitled “Unexpected Health Insurance Rate Shock in California“.
In the one hour debate I had with Mr. Ungar I stated that his entire article was based on a lie that was promulgated by Peter Lee, the Executive Director of “Covered California”. You can read my response to Mr. Ungar and download our one hour debate here. Courtesy of the David Webb show on Sirius XM Patriot Satellite Radio.
Yet the Left continues to print hyperbole in the hopes that policy wonks who operate on facts won’t pick their pieces apart like vultures picking at the rotten, festering corpse that is Obamacare. Well, let me be the first ‘wonk’ to expose this latest fallacy.
The truth is New York, and 7 other states have already had the worst parts of Obamacare for many years. Namely, Community Rating and Guaranteed Issue. Both of these failed Liberal health care policies have resulted in driving premiums to their highest point in recorded history in those states. These policies have also driven insurance carriers out of those states by the droves. Why? Because, those states did not have a mandate to purchase health insurance. As such, many consumers chose to opt out and go uninsured instead. Meaning that there were less people insured in those states, so there were less lives to spread risk around. This drove premiums even higher. Even Mr. Ungar admitted this during our debate back in May.
This means that the premium assumptions made in the New York Times piece are based on the false premise that ‘young invincibles’ and other New York consumers will buy Obamacare compliant health insurance instead of opting out and paying the much smaller fine for not doing so. This simply will not happen to the degree that Obamacare supporters want it to. Regardless of how many NFL players that HHS attempts to recruit to ‘sell Obamacare’ to our youth. Why? Because the fine for not buying health insurance is only 1% of one’s MAGI – Modified Adjusted Gross Income – in 2014. And, we are not repealing EMTALA – the federal law that requires hospitals to treat any patient within 250 yards of an emergency room – regardless of their ability to pay. Also, consumers will be able to buy Guaranteed Issue health insurance coverage, regardless of the severity of their preexisting conditions during the new annual Obamacare ‘Open Enrollment’ periods, with no proof of prior coverage. It is these perverse incentives that will actually incentivize consumers not to purchase health insurance. As was the case in all 8 states that have adopted the same failed policies before.
October 8, 2013 UPDATE: Regarding “Community Rating”. I officially rest my case. Watch:
Lastly, let me address another statement made in today’s New York Times piece. Namely this one: “Beginning in October, individuals in New York City who now pay $1,000 a month or more for coverage will be able to shop for health insurance for as little as $308 monthly.”
The truth is New York residents can shop today using this private health insurance exchange that I have had on my brokerage site for many years before Obamacare to find quality health insurance coverage for a lot less than “$1,000 a month or more”. For example a 45 year old male, non-smoker living in Monroe county, New York would pay $321.21 a month today for a policy with a $1,250 deductible and out of pocket expenses commensurate with the plans that will be offered in the exchanges in 2014. So, in conclusion, can someone please tell me why do we need Obamacare again?