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September 26, 2009
Baucus plan a 'time bomb' to destroy private health insurance?
Topics: Political News and commentariesAccording to Eric Singer, the Healthcare Reform Bill proposed by Senator Baucus is an incomparably cynical piece of legislation creating a time bomb that will eventually destroy all private health insurance. And given the expressed agendas of the far-left Democrats in Congress, and what we've seen in House Bill 3200 (there is no complete Baucus plan to read yet - and the Democrats won't let us read it before they vote on it, anyway), one can find little reason to doubt Singer's charge.
Here's an excerpt:
[...] As these inflationary forces grow, and families begin to drop out of the private plans and seize the government option, the insurance companies will likely experience extreme adverse selection, driving premiums higher, accelerating the loss of insurance pool members, and setting up a vicious cycle which will eventually make the public option the only game in town.Read it all ...Thankfully, Senator Baucus has completely changed the label of the "public option" to an insurance "cooperative" founded [and run] by the federal government and open only to new entities without existing insurance experience. Guided perhaps by the Commonwealth Fund projections of $21,271 for insurance for the average family, Senator Baucus created a "luxury" excise tax for all payments above $ 21,000 per year. . Given the real growth in healthcare costs, by 2020, the average family may easily be paying 25% of their income for healthcare.
The proposed bill leaves room for debate over whether private insurers will be wiped out as early as 2014 or as late as 2022. Of course, long before that the share prices of the private insurers will decline as the stock market discounts when they might be completely forced out of business. What is so stylish in Senator Baucus' proposal view is that it operates like the Alternative Minimum Tax (AMT), but on steroids. The AMT affected just a few hundred tax payers in its first year and took 40 years to swallow most deductions used by, say, [half] of America's meaningful income taxpayers. In contrast, according the Wall Street Journal, the Mercer Group estimates Senator Baucus' bill starts with 14% of health insurance contracts triggering the luxury tax on day one.
The Baucus proposal tidies things up within a decade. It allows President Obama, former Editor in Chief of Harvard Law Review, to say, "...if you like your insurance plan, no one will force you to change it." Of course, if your private insurance company is forced out of business by a combination of new burdens, dramatically higher taxes, and no access to fresh capital, well no one forced you.
At this point in time we can expect just about anything to come out of Congress, and have no reason to discount the extent of their cynicism. The fact that seniors will indeed loose their benefits, there's rationing to come for all, and yes they want nothing less than a public option - even one in disquise, should be no surprise to anyone.
And ominously, there's this report:
The next six weeks will be very telling. The White House Director for the Office of Management and Budget (OMB) said this week that healthcare reform "should be completed over the next six weeks or so, maybe sooner." According to a Wall Street Journal article today, Thursday, September 25, the Obama Administration's "real goal at this point is to get any bill signed into law before the President's approval ratings fall further, and before the gubernatorial elections in New Jersey and Virginia."Cynicism? We're talking cynicism on heavy steroids.
Posted by Richard at September 26, 2009 8:00 AM
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