Wednesday, September 28, 2011

Obamacare regs grind on as courts debate

By John Vinci

Last Friday marked one and a half years since the passage of Obamacare. The more the Obama Administration implements Obamacare and the more Americans discover what it actually contains, the more we realize how disastrous it is.

Just this week Milliman, Inc. issued a report for the Ohio Department of Insurance that estimates Obamacare will cause individual health insurance premiums in Ohio to increase by 55 to 85 percent.

Milliman also calculates that Ohio’s health insurance exchange (now called “Affordable Insurance Exchanges” by the Obama Administration) will cost between $19 million and $34 million per year.
A health insurance exchange is an online marketplace for health insurance — just like Expedia and Orbitz are online marketplaces for the airline and hotel industries. Every state must be on track to have their own exchange set up by 2014 otherwise the federal government will be required to run an exchange for that state. As running an exchange is a substantial undertaking, the Obama Administration is working very hard and somewhat unsuccessfully to encourage states to start their own health insurance exchanges. With only 13 states having passed exchange legislation into law, there’s a good chance the federal government will have to run a significant number of state exchanges.

Obamacare gives the State exchanges the authority to issue subsidies to assist some people with paying for their health insurance. But a federally-run exchange, due to a glitch in the Obamacare statute reported by Investor’s Business Daily, does not have the statutory authority to issue such subsidies. Perhaps unsurprisingly, the administration has ignored the plain text of the statute and is proceeding as if both state and federal exchanges can offer subsidies. If the federal government continues to go beyond the congressionally approved law and provides people with health care subsidies it will mean tens of millions of additional taxpayer dollar expenditures.

Then there’s the High Risk Pools. Due to pre-existing conditions many individuals find it difficult to find health insurance. A high risk pool is an insurance plan for people who can’t get health insurance elsewhere because of their pre-existing conditions. Obamacare sets aside $5 billion to subsidize high risk pools called “Pre-Existing Condition Plans” in every state. While early estimates predicted that the program would quickly run out of money, the program has instead been unsuccessful in attracting people who were presumed to be the most in need.
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