Tuesday, February 4, 2014

Affordable Care Act: The Verdict is In

Back in August I did a blog posting about The Real Healthcare Scam. At that time, I was withholding judgment on the Affordable Care Act until we could see what the impact of the law would be. It's pretty clear that we can declare a verdict at this point...and it's not good.

The good news is that my wife and I are now able to buy a healthcare plan with a $500 deductible. The bad news is that the annual premium is $10,200. before the ACA, we could have purchased a plan with identical coverage and a $3,000 deductible for an annual premium of $2,400. So we're paying an additional $7,800 per year to buy our deductible down by $2,500. Not a great deal.

Now before you say that you can't judge the ACA by just one family's experience, I'll say you're right. However, consider the following:

1. My wife and I are poster children for who the law was intended to help. We are two people without employer healthcare coverage who are not eligible for Medicare or Medicaid and who had to use the infamous Healthcare.gov website exchange to obtain coverage. On this score the law has failed.

2. The law was supposed to "bend the cost curve" and solve most of the issues associated with spiraling healthcare costs in this country. On that score the law is an epic fail, and I'll explain why.

Take a look at this article House Democrat Slams Obamacare After Retiring

"12-term Virginia Rep. Jim Moran, an Appropriations Committee member who said this month that he will not seek re-election in 2014, said that not enough young people are signing up for Obamacare coverage to make the law work."

“I’m afraid that the millennials, if you will, are less likely to sign up. I think they feel more independent, I think they feel a little more invulnerable than prior generations. But I don’t think we’re going to get enough young people signing up to make this bill work as it was intended to financially,” Moran said in an interview with WAMU American University Radio."

“And, frankly, there’s some legitimacy to their concern because the government spends about $7 for the elderly for every $1 it spends on the young,” Moran said."

So isn't that convenient? Jim admits that he attempted to financially screw young people, but they didn't go for it and without them going for it, the law can't work.
Therefore, it will blow up. Another quote from the Congressman:

"I just don't know how we're going to do it frankly. If we had a solution I'd be telling the president right now," Moran said.

As I covered in that August blog post, there is a solution.

1. Scrap the Affordable Care Act because it is all smoke and mirrors. It does absolutely nothing to improve the root cause of our nation's problems.
2. Remove all exemptions from the Sherman and Clayton Acts from any health-care connected firm (insurance companies, hospitals, pharmaceutical companies, device makers, etc.), period, including but not limited to international exemptions.
3. Prosecute each and every person and company that violates those acts.

Do these three things and the cost of health care will drop 80% overnight.
For the truly wonky, Google research on this done by Pew Research Foundation, Cato Institute, Heritage Foundation, and Wharton Business School. For a more "layman" explanation, the best mainstream media article I have ever read was written by Steven Brill for Time Magazine (Bitter Pill: Why Medical Bills are Killing Us). It may still be available online HERE

Yes, there will be some medical options we can do now that you won't be able to obtain (at least in the short term).  That's part of the price.

However, if these solutions are implemented, not only will you be able to afford to buy health care for cash, but catastrophic insurance (true insurance) will be available at a few hundred dollars a year instead of thousands.

At the same time Federal, State and Local budgets will also have their deficit problems disappear.

We will have to accept a short-term economic dislocation to do this.  But that which is spent on ridiculously-priced monopolistic health care now will be reallocated to other, more-productive areas of the economy within months, and the US will become one of the most-competitive places to do business, if not the most-competitive place in the world.

Unfortunately, this will never ever happen. The most financially lucrative lobby in the world is the U.S. healthcare lobby. In dollar terms it exceeds every other lobbying interest (yes....bigger than the Wall Street lobby, bigger than the Defense/Military lobby, bigger than the Fossil Fuel lobby, bigger than all of the Labor Union lobbies combined). Both parties rely on this cash stream to stay in power. Insurance companies, pharmaceutical companies, doctors, nurses, etc. will scream bloody murder...and they would win. As a result, our healthcare system can practice financial rape because our politicians have made competition in the sector a felony. That's not only backwards, it's extortion and it's tyranny.

So we will not have these solutions and all of the existing health care scams/"protections" will remain in place. Instead, we will continue to put lipstick on the pig and continue to screw the people of this country "just a little more."


  1. Well said. For those who may find it hard to believe that the healthcare industry wrote the ACA, check out the dollars spent by lobbyists at: http://www.opensecrets.org/lobby/

  2. That's a great website. Taking a look at the top spenders on lobbying will affect anyone's view on where the big lobbying money is spent. Spoiler alert: Contrary to popular belief, it's not the big banks/Wall Street or big oil that is running the show.

  3. Great explanation John. I understand most of what you wrote. I didn't think ACA was good from the beginning of "we have to pass it to see what's in it.." Nothing could be good about that.

    1. It's too bad that at this point both political parties have been bought and paid for by the health care lobbies.