The Health Care bill that recently squeaked through Congress is more costly than advertised and will provide far less than advertised. Oddly, there is a monumental omission- it allows the denial of coverage until 2014 for children with pre-existing conditions. As this was a frontispiece for Barack Obama in his promotion of the bill and Democrats made so much of it, it boggles the mind that Democrats could have omitted it. One is left to decide whether Democrats are merely incompetent or colossally stupid. Then again, maybe it’s something else.
This plan is designed to destroy the private insurance industry. Democrats crafted a law with the intent of destroying an entire American business sector.
This bill demands that all Americans have insurance and provides for penalties for those who do not comply and for businesses which do not provide coverage for employees. The penalties for individuals not having insurance are about $2000 per year and $6000 at most for a family. That is far less than the cost of a good basic health care plan. The penalty for employers for not providing a health care plan is about $2000 per employee, less than the penalty ($3000) for not offering an “affordable” health care plan. That is far less expensive than the cost of a health care plan for employees. Why would the penalties be considerably less than the actual cost of insurance? Since the costs of the penalties are less than cost of insurance, it makes financial sense to simply not have insurance until you get sick, at which time you can simply buy it because you no longer can be denied coverage.
Who is supposed to levy the penalties for those who do not comply? That would be the IRS, 16,500 of who are being added to the IRS employ. The problem is they cannot make you pay. That’s right; if you don’t pay they cannot make you pay. Democrats have not provided for the criminalization of the failure to have coverage. So all those penalties just described? They are meaningless. The Joint Committee on Taxation said- and I quote-
The penalty applies to any period the individual does not maintain minimum essential coverage and is determined monthly. The penalty is assessed through the Code and accounted for as an additional amount of Federal tax owed. However, it is not subject to the enforcement provisions of subtitle F of the Code. The use of liens and seizures otherwise authorized for collection of taxes does not apply to the collection of this penalty. Non-compliance with the personal responsibility requirement to have health coverage is not subject to criminal or civil penalties under the Code and interest does not accrue for failure to pay such assessments in a timely manner.
No seizures, no liens, no interest. No civil or criminal penalties. No way to collect. Now why would anyone do this? The answer is to destroy the private insurance industry. Only sick people will seek insurance. That means healthy people (who are crucial to making a system work) will avoid coverage until they need it. That means a gigantic drain on the insurance system and monumentally high premiums- eventually more than anyone can realistically afford and eventually they’ll drop out. It’s called the death spiral and it is what Obama and the Democrats intended. They will destroy an industry so that they can institute single payer and control all of medicine. That means the loss of the 65,000 insurance jobs remaining in this state. It means another industry lost to this state. It means enormous losses of salaries, jobs, property taxes and losses to related industries such as the restaurant business. I cannot ever remember a time when the Federal government sought by design to destroy an entire American industry. I cannot remember when the American government went to war against its own people.
Welcome to the new world. You have Murphy, Dodd, Lieberman, Courtney and their Democrat ilk to thank for this. Remember them come November. And what of those promises of keeping your doctor and your plan if you chose? Forget it. They are as worthless as every other promise Barack Obama ever made. This was never about health care. It’s about complete control of your life and this is the first step. Just wait until you see financial reform. Wait until you see amnesty. Wait until you see Cap and Trade. They’re all puzzle pieces to complete the transformation of this country into the United Socialist States of America. That is the “fundamental” transformation Barack Obama promised.
DrJohn has been a health care professional for more than 30 years. In addition to clinical practice he has done extensive research and has published widely with over 70 original articles and abstracts in the peer-reviewed literature. DrJohn is well known in his field and has lectured on every continent except for Antarctica. He has been married to the same wonderful lady for over 30 years and has three kids- two sons, both of whom are attorneys and one daughter on her way into the field of education.
DrJohn was brought up with the concept that one can do well if one is prepared to work hard but nothing in life is guaranteed.
Except for liberals being foolish.
The following elements of the health care bill begin in 2014:
“• Individuals without gov’t‐approved coverage are subject to a tax of the greater of
$695 or 2.5% of income
• Employers who fail to offer “affordable” coverage would pay a $3,000 penalty for
every employee that receives a subsidy through the Exchange
• Employers who do not offer insurance must pay a tax penalty of $2,000 for every fulltime
employee”
source: http://republicans.waysandmeans.house.gov/UploadedFiles/WM_hcr_timelinel.pdf
To provide some sense of context on actual employer-provided health care costs, I found a chart, which shows that the average individual health care plan costs an employer $4045 with an employee contribution of $779 (per year). Average family coverage costs an employer $9860 with employee contributions of $3515 (also per year). These numbers are based on a 2009 survey.
source: http://ehbs.kff.org/?page=charts&id=2&sn=21&ch=1058
As you stated, the penalties imposed by the health bill are, indeed, considerably smaller than the costs to individuals and employers. The health care bill does, indeed, create an incentive to not get health care until you are sick, and since giving coverage to everyone, even those very very sick, is now mandated by law, there’s no downside to the consumer in doing it this way. Worse, there is a cap on how much an insurance company can charge an individual with a pre-existing condition, meaning that, as the number of people only buying insurance in times of need approaches 100%, there is no way for an insurance company to ever break even, much less turn a profit.
I think you omitted one of the very sinister aspects of this whole process, however. People will elect to pay this penalty as taxes to the government, in lieu of giving money to an insurer (I’d wager they’ll fix the ‘no way to enforce collection’ issue before 2014). Government gets bigger, private industry collapses. And the hapless citizen feels like he’s getting a good deal by paying off Uncle Sam for not having to pay for insurance any more.
And when the insurance companies try to raise their rates to keep solvent in this new environment, the government will interfere again, saying the evil capitalists are taking advantage of the citizens, and must be punished with more taxes and more regulations preventing them from “profiteering”.
I wouldn’t want to work in the medical industry or insurance industry right about now.
“People will elect to pay this penalty as taxes to the government, ”
Until they find out there’s no real way to collect those taxes and that there is no penalty for not paying them, but I do agree with your thoughts. Government wins no matter what.