Is ObamaCare Imploding?
Remember when Democrats promised ObamaCare was going to get popular as soon as people understood what was in it? Remember the claim that the polls would swing to positive as the front-loaded "benefits" showed up?Americans are still waiting. Meanwhile, a new Heritage study shows that by 2017 about 7.4 million seniors will lose their Medicare Advantage coverage - disproportionately hitting minorities and low-income seniors. The combination of direct Medicare Advantage cuts and the indirect impact of reducing fee-for-service reimbursements spells doom for many and reduced benefits for the remainder.
American businesses, meanwhile, are not waiting to learn anymore. It has done due diligence and scrubbed the financial fallout. McDonalds warned recently that they might have to drop their "mini-med" insurance plans, and the same logic will likely apply to others like Staples, Disney, Blockbuster, and Home Depot. The problem: inability to meet the new federal regulations for "medical loss ratios". Not only are the nearly 30,000 McDonalds employees - disproportionately part-time and low wage - threatened with moving to the ranks of the uninsured, those covered by not-for-profits like AmericCorps or U.S. colleges and universities are threatened with the same fate.
Retirees face the same fate. 3M will no longer offer retiree coverage. It is an open question whether these seniors will move to Medicare or the subsidized exchanges, but the clear implication is that ObamaCare will cost more than anticipated and that the "If you like your health care you can keep it" pledge is a cruel joke.
Smaller insurers are simply saying "uncle." Principal Financial Group is exiting the health insurance market and its 840,000 policyholders will shift to United Health Group. The upshot appears to be that ObamaCare will feed consolidation and hinder competition in the insurance market.
Consumers face higher insurance premiums, as costly new benefit mandates take effect and the underlying cost of health care continues to explode.
It is far from over. Major regulation are being issued weekly, so it will actually be years before it is possible to fully understand the new law. But in the interim, it is not getting more popular, it is not improving insurance, and it is not lowering costs.
Remember when health care reform was supposed to lower costs, provide better and more affordable insurance options, and be popular? Is it possible that those days will return under a strategy of repeal and replace? Let us hope so.
Holtz-Eakin is President of the American Action Forum.
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