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November 2 2016

ObamaCare 4.0: Still a Disaster 3 Years Later but Not for the Same Reasons

Patrice L. Onwuka

Yesterday was open enrollment day for ObamaCare and it appears Healthcare.gov worked, but technology was never the biggest problem with ObamaCare. Affordability is.

According to a tweet from Health and Human Services Secretary Sylvia Burwell, the number of applications submitted through Healthcare.gov was up 50 percent in the first six hours from last year climbing above 60,000. That’s even better than 2013 when they had zero. However, celebrating that your website works means nothing if the product you’re peddling is overpriced and under delivers.

Three years ago when ObamaCare 1.0 launched, it’s was a disaster. The Obama Administration delivered the defunct Healthcare.gov website with incomplete back-end systems. Unable to go online as they had been told, customers were driven to call centers that kept people waiting for hours, if they connected with anyone, leading to frustration. Insurers finally used such high-tech tools as pen, paper, and spreadsheets to process applications. Eventually they brought in techies to get the website online, but various issues with authenticating immigration status and financial resources persisted.

The Obama Administration’s unpreparedness and lack of leadership was on full display when for months, they struggled to get the website operational. All of the media hype and national marketing efforts pumped Americans up but for weeks all we saw was chaos and failure.

Fast-forward three years: While Healthcare.gov is operational, the chaos has not disappeared. The fundamental problem with the Affordable Care Act has worsened: its un-affordability.

Americans who lost their ObamaCare coverage because health care insurers pulled out of ObamaCare due to heavy losses, logged onto search for an affordable plan that President Obama claims is there. Like looking for a cashmere sweater in your size marked down 70 percent during a Black Friday sale, such deals were hard to find.

Premiums have spiked 25 percent nationally for 2017 coverage making Obamacare 4.0’s sticker price even less affordable than before. In addition, customers face higher deductibles, more limited choices of plans, limited healthcare providers (just one provider for some), and more limited networks of doctors.

Healthcare experts point to the chaos in the system:

“The way people are experiencing Obamacare varies tremendously across the country," says Larry Levitt, a senior vice president of the non-partisan Kaiser Family Foundation.  "In some states, the market is stable and in other places, it’s a bit of a mess."

For example, the second lowest cost silver plan — which federal subsidies are based upon — was up 116% in Arizona and down 3% in Indiana. In Indiana, four insurers left the exchange and four remain, while consumers in all but one Arizona county only have one insurer to buy from.

The 25-percent national premium hike sounds shocking, but people in some states may find that it’s far worse than 25 percent. Premium trackers demonstrate just how varied the higher premiums will rise per state.

President Obama and his surrogates have touted the increased tax subsidies – courtesy of generous taxpayers – as the solution to rising premiums. That means that taxpayers will be squeezed. To qualify for subsidies you need to earn between 100 percent ($11,880 for an individual) and 400 percent ($47,520) of the poverty line.

While low-income Americans might get generous help, the effect of ObamaCare on taxpayers already struggling will be onerous. CBNC reports:

More than half of such customers have low enough incomes, below 250 percent of poverty, that they also qualify for extra financial aid to lower their out-of-pocket health costs.

Despite that message, many people aren't hearing it — or don't care when they do.

Karen Pollitz, senior fellow of the Kaiser Family Foundation, said the initial wave of millions of people signing up for Obamacare included many whom had pressing health needs, and who had been priced out of the individual plan market beforehand.

Obamacare critic Robert Laszewski, president of Health Policy and Strategy Associates, said Obamacare is "working pretty well" for people who earn less than 200 percent poverty — and thus get the most help paying for their premiums and out-of-pocket health costs.

"This really works for low-income people," Laszewski said. "Who is getting clobbered are the middle class and people without subsidies."

Just imagine a young woman whose plan was cancelled because insurers pulled out of ObamaCare in her state. Over the past year she got a raise that bumped her above the “poverty” threshold. Not only will she face higher premiums, but there’s no subsidy for her. Previously, she might have been shielded from the sticker shock of premium costs by a subsidy, but no longer with her higher income. She may be apt to take the tax penalty instead of buying another ObamaCare plan that will just eat up her budget.

The Obama Administration can cheer that there’s traffic to Healthhcare.gov, but high-volume activity doesn’t necessarily mean more completed enrollments when the folks who create this traffic see what their premiums will be. Why should it when for Americans ObamaCare is an even worse deal than it was before?

IIndependent Women's Forum is an educational 501(c)(3) dedicated to developing and advancing policies that aren’t just well intended, but actually enhance people’s freedom, choices, and opportunities. IWF is the sister organization of the Independent Women’s Voice.​
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