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Thread: Health Care Reform Provision Is Unconstitutional, Federal Judge Rules

  1. #281
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    Re: Health Care Reform Provision Is Unconstitutional, Federal Judge Rules

    Quote Originally Posted by Boo Radley View Post
    But Mass makes a case that it can't be done effectively on the state level


    5 Painful Health-Care Lessons from Massachusetts

    ...Lesson 1: The Massachusetts plan does not control costs.

    When Massachusetts launched its reform program in 2006, it already had the highest medical costs in the nation. Today, the burden is still rising far faster than wages or inflation, from those already lofty levels. A report from that state attorney general in March -- remember, this is a Democratic administration -- asked rhetorically "Can we expect the existing health-care market in Massachusetts to successfully contain health-care costs?" The report concluded, "To date, the answer is an unequivocal 'no.'"

    Costs are rising relentlessly for both families and for the state government. The median annual premium for family plans jumped 10% from 2007 to 2009 to $14,300 -- again, that's a substantial rise on top of an already enormous number. For small businesses, the increase was 12%. In 2006, the state spent around $1 billion on Medicaid, subsidies for medium-to-lower earners, and other health-care programs. Today, the figure is $1.75 billion. The federal government absorbed half of the increase.

    Hence reform's proponents boast that expenses have risen only $354 million or around 6% a year. But the real increase is double that, including the federal share. And it's highly possible that given the current budget pressures, the U.S. will reduce the contribution that has encouraged the state to spend so lavishly.

    Lesson 2: Community rating, guaranteed issue and mandated benefits swell costs.

    How did costs in Massachusetts get so big to begin with? A major reason is the adoption of guaranteed issue and community rating in the mid-1990s. The new federal bill would expand those rules to the entire nation. Under guaranteed issue, insurers must accept all enrollees regardless of their medical condition; under community rating, they must charge all customers similar premiums, even if their costs are far different. The result is that prices rise steeply for young, healthy customers, who must pay far more than their actual costs. It also give them a strong incentive to drop insurance; then they can "game the system" by signing up any time they need surgery or get diabetes.

    Hence the pool of insured people gets older and sicker as the healthy drop out. That's what happened in Massachusetts, and it contributed to soaring premiums. The 2006 reform plan was supposed to solve the problem by requiring that everyone buy coverage or pay a fine of around $1,000. It worked, but only in part: Of the 600,000 uninsured in 2005, around 450,000 are now covered. But a large share of 150,000 who still lack coverage are young residents who choose to pay the fine instead of high premiums. Insurers are also getting socked by people who sign up for insurance to get expensive care mandated under state law, including hospitalization for childbirth or hip replacements, and then depart once the procedure is completed.

    In the federal bill, the fines for going uninsured are even lower than in Massachusetts -- and anyone who can't find an inexpensive plan is exempted from all penalties. Hence the "adverse selection" problem could prove far worse.

    Lesson 3: Huge subsidies for low-to-medium earners could prove extremely expensive.

    One of the most fascinating features of the Massachusetts plan is that it introduced a system of subsidized policies, sold through an insurance "exchange" that's extremely similar to the one in the new federal plan. Under Commonwealth Care, the state subsidizes plans -- offered by private carriers -- for residents who earn up to $66,150 who are not covered by employers. The aid is extremely generous. At $44,000, families pay around $1,000 a year in premiums. At the $66,150 maximum, they contribute around $3,000.

    The problem is that the actual annual cost of these plans is around $10,000, so the subsides are enormous -- that's 90% for families earning $44,000. And while the costs keep going up, the share paid by the enrollee barely budges. Says Michael Tanner, an economist at the conservative Cato Institute: "It's a situation where the entire escalation in costs is paid by the government, not the people receiving the care."

    The federal plan also subsidizes care provided through state-run exchanges. The patients' contributions are bigger than in the Mass. plan: A family earning $66,000 would pay $6,300 a year. But the federal plan offers subsidies far higher along the income scale, aiding families of four making up to $88,200. And surprisingly, the federal plans would probably prove a lot more costly than the ones in Massachusetts, where the state prides itself on restraining what they pay by squeezing providers, who then shift the added costs to private customers.

    ...The big problem arises if far more people sign up for these exchange-offered plans than anticipated. That's been the case in Massachusetts. And as we'll see in a moment, it could still get a lot worse there. A potential disaster threatens the federal plan if employers staring dropping coverage, since a flood of newcomers would rush into the state-funded pools.

    Lesson 4: The exchanges reward people for working less and earning less.

    Data is lacking on how damaging these perverse incentives are in practice. But it's clear in Massachusetts that low-to-medium earning families often suffer financially if they get a raise, work overtime, move to a higher paying job -- or if a spouse rejoins the workforce. For example, a family earning $33,000 pays no premium at all under Commonwealth Care. But if their pay goes to $46,000, they're obligated to contribute about $2,400. That's an effective tax rate of 18.5% on that $13,000 raise. A pay increase of $44,000 to $46,000 is mostly erased by higher premiums alone.

    The federal bill is plagued by the same weakness. For example, a $55,000 earner contributes $4,400 a year towards insurance. At $65,000, the bill is $6300; so the family is paying a "tax" of $1,900 or 19% on that $10,000 raise. After payroll taxes, those Americans would face a marginal rate of around 35%, a number that's heretofore been the territory strictly for high-earners.

    Lesson 5: The generous plans and added mandates give employers an incentive to drop health insurance.

    In charting the future of health-care costs, the biggest danger by far is that companies will drop their coverage. It's also the one that's the most difficult to handicap, both for Massachusetts and the entire nation. The problem is simple: If employers stop paying for health care, employees will flood into the government-subsidized programs, enormously raising the cost to already fragile budgets.

    Surprisingly, health reform in Massachusetts has actually increased the number of workers covered by employers. Over 100,000 more employees are covered by corporate plans today than when the program debuted in 2006. The main reason is that the plan imposed a $1,000 fine on employees who refused their employers' plans. Then, families were paying around $3,600 a year towards their company policies. Many decided that, when faced with a fine, the better choice was paying the extra $2,600 for full coverage. The plan was shrewdly calibrated by the administration of then-governor Mitt Romney to tilt the market towards company-provided care.

    The Massachusetts plan also bans any employee from getting coverage from Commonwealth Care if his or her company offers coverage. Hence it would appear that corporate coverage is solidly entrenched. But that's by no means certain, either in Massachusetts or under the Obama plan. The reason is the fast escalation in costs, for both companies and employees. From 2007 to 2009, the employee contribution for family policies rose a steep 17%, or $624 a year, to $4,200.

    Employees can only move into Commonwealth Care if their employers drop their plans. The danger is that the incentives are tilting in that direction as the costs of coverage for employer, and the price of premiums to employees, keep climbing. The point is rapidly approaching where both will pocket big savings if employers drop their plans and workers buy their policies through the heavily subsidized exchanges.

    In Massachusetts, the state government is pushing toward that tilt point by adding heavy mandates to a list of more than 40 already on the books. In 2009, it required insurers to cover prescription drugs. An expensive autism mandate is now being debated in the state legislature. The list of mandates under the federal plan is bound to mirror the ones in Massachusetts, and once again, the added expense severely weakens companies' incentive for providing coverage.

    Cracks are already starting to appear. Part-time workers can get coverage under Commonwealth Care for a fraction of what they'd pay as full-timers. So they "game the system" by working ten or fifteen hours a week for two or three companies. Or they find that it pays to switch from full- to part-time work. PHI, an organization that represents home health-care workers, states that one-fourth of the home care agencies in Massachusetts are reducing workers' hours so they're eligible for state-subsidized care.

    The federal plan will encounter the same problem -- perhaps a more acute one since its penalties are lower and its subsidies go much higher on the income scale...

  2. #282
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    Re: Health Care Reform Provision Is Unconstitutional, Federal Judge Rules

    Quote Originally Posted by ptif219 View Post
    Obama will now have to work with the GOP on healthcare.
    I thought the republicans didn't want to work on health care. I thought they wanted the status quo as the well to do are dong just fine. You know, costs will triple in 10 years, more and more of us that pay our premiums will have to pay for those that don't, and more and more employers will have to say you're on your own we can't afford it anymore.

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    Re: Health Care Reform Provision Is Unconstitutional, Federal Judge Rules

    hey! lookit that! Massachusetts is suffering from the exact same problems that ole cpwill predicted would come from Obamacare! wow, whatta coincidence....

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    Re: Health Care Reform Provision Is Unconstitutional, Federal Judge Rules

    Quote Originally Posted by EnigmaO01 View Post
    I thought the republicans didn't want to work on health care.
    we weren't allowed to work on healthcare. democrats had the votes to do it without us, and they knew they could get a much more liberal program doing just that. it would have been so easy to pick off an Olympia Snowe-type Republican (she practically begged Democrats to throw her the smallest of bones to do just that); but it would have meant moving the plan incrementally to the right, so why do it? the leadership of the Democratic Party wanted a further left version than their own party did; why would they move it even further right to pick up Republicans? they wouldn't, and they knew that they wouldn't, so they never bothered.

    I thought they wanted the status quo as the well to do are dong just fine.
    actually Republicans have been putting forward some pretty interesting systemic solutions to the problems of rising health insurance premiums. In Indiana, for example, Republican Governor Mitch Daniels was able to lower costs 11% even as costs were skyrocketing elsewhere.

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    Re: Health Care Reform Provision Is Unconstitutional, Federal Judge Rules

    Quote Originally Posted by j-mac View Post
    Mass can do it? and have, it is a failure, I don't have to live there. Where can I go if this remains as it is?


    j-mac
    nowhere; and i think that's why they are so desperate to federalize this stuff. blue-leaning states are losing people and red-leaning states are picking them up as folks flee their mismanagement. you've got to trap them so that they can't escape a failed system, causing it to collapse that much further.


    if taxes get hiked like they want, look for them to try to pass legislation saying that if the rich choose to move out of the state/nation they aren't allowed to take their wealth with them.

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    Re: Health Care Reform Provision Is Unconstitutional, Federal Judge Rules

    Quote Originally Posted by EnigmaO01 View Post
    I thought the republicans didn't want to work on health care. I thought they wanted the status quo as the well to do are dong just fine. You know, costs will triple in 10 years, more and more of us that pay our premiums will have to pay for those that don't, and more and more employers will have to say you're on your own we can't afford it anymore.
    do you want to see how silly you sound, your side of the argument I mean?
    and I say that respectfully.

    ok, so how is Obama care going to fix what you mention in your post here?
    lets take it line by line

    Costs will triple in ten years....




    more of us that pay our premiums will have to pay for those that don't.....


    more and more employers will have to say you're on your own we can't afford it anymore....

    do you think Obama care is going to fix these things?
    really?
    Last edited by shades; 12-21-10 at 11:46 AM.

  7. #287
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    Re: Health Care Reform Provision Is Unconstitutional, Federal Judge Rules

    Quote Originally Posted by ptif219 View Post
    This may mean the whole law will have to be thrown out. Obama will now have to work with the GOP on healthcare.
    LOL....it was the Republican idea to require people to purchase healthcare that was thrown out. Now we need to return to the public option that we should have gotten in the first place.
    <font size=5><b>Its been several weeks since the Vegas shooting.  Its it still "Too Early" or can we start having the conversation about finally doing something about these mass shootings???​</b></font>

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    Re: Health Care Reform Provision Is Unconstitutional, Federal Judge Rules

    Quote Originally Posted by EnigmaO01 View Post
    I thought the republicans didn't want to work on health care. I thought they wanted the status quo as the well to do are dong just fine. You know, costs will triple in 10 years, more and more of us that pay our premiums will have to pay for those that don't, and more and more employers will have to say you're on your own we can't afford it anymore.
    I guess you were mistaken.
    "He who does not think himself worth saving from poverty and ignorance by his own efforts, will hardly be thought worth the efforts of anybody else." -- Frederick Douglass, Self-Made Men (1872)
    "Fly-over" country voted, and The Donald is now POTUS.

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    Re: Health Care Reform Provision Is Unconstitutional, Federal Judge Rules

    Quote Originally Posted by disneydude View Post
    LOL....it was the Republican idea to require people to purchase healthcare that was thrown out. Now we need to return to the public option that we should have gotten in the first place.
    You mean socialist option.
    "He who does not think himself worth saving from poverty and ignorance by his own efforts, will hardly be thought worth the efforts of anybody else." -- Frederick Douglass, Self-Made Men (1872)
    "Fly-over" country voted, and The Donald is now POTUS.

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    Re: Health Care Reform Provision Is Unconstitutional, Federal Judge Rules

    Quote Originally Posted by Boo Radley View Post
    But Mass makes a case that it can't be done effectively on the state level.
    You can not possibly be serious. It's bankrupting the state.

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