March 13 2014
New Admission: ObamaCare to Raise Premiums
Patrice J. Lee
This hasn’t been a good week for President Obama and his Administration as his signature healthcare law is coming apart at the seams and they can’t hide it, spin it, or ignore the problems.
As we reported yesterday, with just two weeks before the open enrollment deadline, signups for ObamaCare are behind where they need to be to meet the six million –recently revised down from seven million- enrollment target. On top of that close to a million people who signed up for ObamaCare have yet to pay their first month’s premium, which may lead to their being cancelled. And despite the Administration’s PR efforts, young people are still opting out of buying ObamaCare, which doesn’t bode well for a system that relies on young, healthy people subsidizing the costs of older, sicker Americans.
It’s no surprise then that healthcare costs will rise next year to reflect the demographic and usage of services for those with ObamaCare. The surprise is that the Administration is being open about it.
During a House hearing yesterday, Health and human Services Secretary Kathleen Sebelius admitted that ObamaCare premiums will probably go up in 2015. In addition, she revealed that the Administration is clueless about how many ObamaCare customers have paid their premiums or how many ObamaCare “enrollees” had insurance previously.
The Daily Caller reports:
“I think premiums are likely to go up, but go up at a slower pace” than they did previously, Sebelius admitted at Wednesday’s House Ways and Means Committee hearing.
“I can’t tell you that, sir, because I don’t know that,” Sebelius said when asked by Georgia Rep. Tom Price how many Obamacare customers have paid their first premiums. Sebelius said she also does not know how many Obamacare customers previously had insurance plans that were canceled.
The administration’s inability to meet its goal for enrolling young, healthy “invincibles” on the Obamacare exchanges has mired the entire Obamacare program in the so-called “death spiral,” which drives up health insurance rates because older, sicker people are primarily signing up.
Lawmakers at Wednesday morning’s hearing grilled Sebelius on the impact of the employer mandate, taxpayer-funded contractor costs related to the glitch-ridden Obamacare enrollment website, and the administration’s inability to meet its original goal of enrolling seven million people in Obamacare.
At least she is being honest, but we’ll see how long it will be until she walks back her admissions at the direction of the White House.
At best this admission is embarrassing to the White House, but the real harm is that Americans who signed up for ObamaCare thinking they would save money or spend less will face a rude awakening very soon.
Each day we report on the harmful consequences of ObamaCare. The overarching lesson is about the failure of central planning in addressing large, complex societal problems by meddling with the private market. Experts in Washington think they can plan every detail but they have imperfect knowledge and in this case they expected individuals and business to respond perfectly in line with their expectations. Well, their expectations were wrong. They neglected to base their plans on solid economic principles and human behavior.
Now, we have a distorted healthcare market, millions of Americans left without healthcare coverage, taxpayers on the hook to subsidize the costs of those who do sign up, businesses forced to make employment decisions that are hurting American workers, and all Americans facing a tax penalty that they didn’t have before.
Unfortunately, our nation’s leader and those he’s put in charge stubbornly refuse to change course, barreling ahead dragging our economy and nation into new calamity each day.