One more economic thread for the week, and then a vacation. Anyway, back in 2010 when the ACA came out, I read it or at least tried to. What a bunch of "mumbo jumbo" I thought. But, I stepped back from its overbearing number of pages, and thought, yikes, this is going to be a mess. In the end, yes we want more people to have affordable health care. But, the problem is and was: the ACA never addressed two fundamental issues: 1) the cost of health insurance and 2) the cost of health care itself. And, for me also the cost of creating and implementing and operating ACA, given the Federal Governments inability to operate most everything it is involved with. So, here this morning I present part of an article which supports one of my concerns - the cost of health insurance.
An excerpt form the article:
"Why The US Consumer Is About To be Crushed: The Obamacare Inflationary Deluge Arrives
Submitted by Tyler Durden on 05/22/2015 09:53 -0400
For the past three years, the biggest argument supporters of Obamacare would trot out every single time when faced with opposition to the mandatory tax, would be that despite widespread predictions of soaring prices, US medical care service costs had remained low and even, on occasion, declined (we leave aside the lack of discussion about soaring deductibles which are recurring "one-time" charges incurred whenever anyone does need medical care, and whose weighted impact on overall medical outlays is dramatic).
A big reason for this delayed increase in prices is that many insurers were unable to gauge the full base-effect impact of Obamacare on their P&L: after all, effective implementation of Obamacare had been materially delayed thus preventing an apples to apples comparison of incurred fees versus revenues.
All that changed moments ago when core US inflation finally spiked the most since 2013 driven by a 0.7% monthly surge in medical care service costs: the highest since 2007!
What's far worse for the troubled US consumer, this is just the beginning. Because after finally digesting the true cost of Obamacare, any recent insurance prime hikes will seem like a walk in the park compared to what is coming.
According to the WSJ, key insurers in some states are proposing hefty rate boosts for plans sold under the federal health law.
Case in point:
In New Mexico, market leader Health Care Service Corp. is asking for an average jump of 51.6% in premiums for 2016.
The irony is that while the Obama administration "can ask insurers seeking increases of 10% or more to explain themselves, but cannot force them to cut rates. Rates will become final by the fall."
Why the explosion in costs? Simple: take on look at the IBB or any other biotech index, all of which have exploded in recent years as a result of one key thing: pushing prices of medicines ever higher. Now, finally, these soaring prices which have likewise resulted in soaring stock prices, are about to be funded by everyone else."
. . . .
The rest of the article does a very good job talking about the economy and things such as the CPI and the GDP. (Well worth the read). - You can Google the title of the article and you will find it.
As I have said before about a number of things the "devil is in the details" and the same thing is true here. I have also mentioned the Cadillac tax for the ACA which will be implemented beginning in 2018. As always, it is about the road not yet travelled and the unintended consequences. And, about unintended consequences - are they really unintended or does the Government know what they are but conveniently do not tell you? My guess, is a little of both.
Enjoy the Memorial Day weekend and remember and salute all who have served and given their lives to protect and defend our freedom and our liberties, which in fact we as well must continue to do each and everyday.
Fight On!
An excerpt form the article:
"Why The US Consumer Is About To be Crushed: The Obamacare Inflationary Deluge Arrives
Submitted by Tyler Durden on 05/22/2015 09:53 -0400
For the past three years, the biggest argument supporters of Obamacare would trot out every single time when faced with opposition to the mandatory tax, would be that despite widespread predictions of soaring prices, US medical care service costs had remained low and even, on occasion, declined (we leave aside the lack of discussion about soaring deductibles which are recurring "one-time" charges incurred whenever anyone does need medical care, and whose weighted impact on overall medical outlays is dramatic).
A big reason for this delayed increase in prices is that many insurers were unable to gauge the full base-effect impact of Obamacare on their P&L: after all, effective implementation of Obamacare had been materially delayed thus preventing an apples to apples comparison of incurred fees versus revenues.
All that changed moments ago when core US inflation finally spiked the most since 2013 driven by a 0.7% monthly surge in medical care service costs: the highest since 2007!
What's far worse for the troubled US consumer, this is just the beginning. Because after finally digesting the true cost of Obamacare, any recent insurance prime hikes will seem like a walk in the park compared to what is coming.
According to the WSJ, key insurers in some states are proposing hefty rate boosts for plans sold under the federal health law.
Case in point:
In New Mexico, market leader Health Care Service Corp. is asking for an average jump of 51.6% in premiums for 2016.
- In Tennessee, the biggest insurer BlueCross BlueShield of Tennessee, has requested an average 36.3% increase.
- In Maryland, market leader CareFirst BlueCross BlueShield wants to raise rates 30.4% across its products.
- In Oregon, the largest insurer Moda Health seeks an average boost of around 25%.
The irony is that while the Obama administration "can ask insurers seeking increases of 10% or more to explain themselves, but cannot force them to cut rates. Rates will become final by the fall."
Why the explosion in costs? Simple: take on look at the IBB or any other biotech index, all of which have exploded in recent years as a result of one key thing: pushing prices of medicines ever higher. Now, finally, these soaring prices which have likewise resulted in soaring stock prices, are about to be funded by everyone else."
. . . .
The rest of the article does a very good job talking about the economy and things such as the CPI and the GDP. (Well worth the read). - You can Google the title of the article and you will find it.
As I have said before about a number of things the "devil is in the details" and the same thing is true here. I have also mentioned the Cadillac tax for the ACA which will be implemented beginning in 2018. As always, it is about the road not yet travelled and the unintended consequences. And, about unintended consequences - are they really unintended or does the Government know what they are but conveniently do not tell you? My guess, is a little of both.
Enjoy the Memorial Day weekend and remember and salute all who have served and given their lives to protect and defend our freedom and our liberties, which in fact we as well must continue to do each and everyday.
Fight On!
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