Average Obamacare Family Plan Costs $19,000 Annually—Double-Digit Increases Expected


#1

Got to love it when a plan comes together.
The Average Obamacare Family Plan Costs $19,000 Annually—as Much as a New Car

Whatever your personal opinion on universal healthcare in theory, we should all be able to agree that Obama’s Affordable Care Act was a poorly-crafted piece of legislation. Furthermore, it has failed to live up to its stated purpose of making health insurance affordable for even the poorest Americans.

For example, we have observed premiums for Obamacare plans double over the last four years in Maryland, with double-digit increases expected for most other states. Not only do such increases defeat the Act’s purpose, but they also have a negative impact on America’s economy.

Data from the Kaiser Family Foundation, and published published in the Wall Street Journal shows that rising insurance premiums are a major disincentive for small businesses to hire new employees, and are costing many workers their benefits (and private coverage).

According to the report, the average annual cost of employer health coverage for a family plan was nearly $19,000—equivalent to the cost of a new vehicle every year.

The below graph illustrates both the rapid cost increase, and the rising costs to employers:

Now the first thing one will note is that the impact of Obamacare, while significant in its own right, is couched in a broader trend—even without Obamacare healthcare premiums would have nevertheless increased, if not to the same degree.

There are a number of reasons for this which we (regrettably) do not have time to deal with in the current article, but suffice it to say that Obamacare has done nothing to make healthcare more affordable. In fact, it’s done the opposite.

Instead, it is worth considering how rising Obamacare premiums have hampered US employment growth—they’re part of the reason the period since the 2008 collapse has been known as a “jobless recovery”.

Why Obamacare Costs Jobs & Slows Growth

Before Obamacare, healthcare benefits were a perk—if an employer couldn’t afford to offer benefits, they simply advertised the job as lacking benefits, and hired a worker. Said worker could then purchase an individual healthcare plan at their own expense (or not at all).

However, Obamacare has imposed a number of restrictions on employers, oftentimes forcing them to provide health coverage to their employees. This has, essentially, functioned like a giant minimum wage increase, but rather than wages the increased costs were due to state-mandated benefits. And like minimum wage hikes, Obamacare has made it impossible for many employers to hire employees at prices they can afford—essentially, Obamacare benefited those who had jobs (provided they were profitable enough), but reduced the availability for those on the outside looking in.

Think of it like this: you’re an employer who wants to hire someone for an annual salary of $30,000. Furthermore, someone is willing to work for said amount. In a free market they would hire the willing employee and they would both benefit—the employer would get a worker, and the worker would get a job.

Enter Obamacare. The legislation forces many employers to provide benefits plans for their employees. Let’s take the same example: the employer wants to hire someone for $30,000, but now must also shell out $20,000 for a family health plan. This brings the costs of hiring someone to $50,000. What will they do?

The employer could either cut the advertised salary to $10,000, and try to attract qualified employees through the benefits (this won’t work because people don’t think like this), or they could eat the costs. Some employers can afford to do so, and their employees benefit at their expense.

However, the majority are unable to increase wages by such an astronomical amount, and simply refuse to hire new employees. This limits job creation, and creates artificial unemployment—the end result is quite absurd.

Obamacare is a policy disaster, and it must be repealed (and if need be, replaced). The sooner the better.


#2

Repeal Obamacare, open up the markets, erase state lines, and let every single insurance company compete to provide services for all Americans. Watch prices drop.


#3

I’m opposed to the whole idea of “insurance”. Research it’s origin, history, and purpose. What do we expect to happen when everybody shifts financial responsibility to the ultimate “elitist/globalist”, the Insurance Corp? They being to define everything that the medical field can and will do.


#4

And don’t forget, tort reform to end the litigious cycle.


#5

Take the next step past PPACA to Medicare for all and watch access increase and prices drop. We need the 20% overhead PI for profit out. In the meantime:

http://www.healthleadersmedia.com/health-plans/ppaca-working-designed-says-commonwealth-fund?nopaging=1


#6

Yep, they are an unecessary middle man adding billions of dollars to the cost of medicine. Medicare operates at a 3.5% overhead with its director earning a scant 247K a year as compared to private insurance CEO’s knocking back 5,10,20 million a year in compensations depending on the PI. It’s a no brainer.


#7

“They being to define everything that the medical field can and will do.”

And you actually believe that shifting the authority from insurance to the government is the answer to getting third parties out of the medical care business? Do you believe that deincentivizing innovation will make for better medical advancements? You bring up compensation for private insurance CEO’s… that of course is not a problem if you don’t rely on insurance to deliver normal and what should be reasonably priced care… They are a middleman, quite interestingly enabled by… government.


#8

Everyone is entitled to his own opinion, but not his own facts.

This country cannot afford medicare for all.
CMS – which has never before released Medicare opt-out figures – reports that 9,539 physicians opted out of the Medicare program in 2012. That is up from 3,700 physicians opting out in 2009. All in all, the number of doctors who opted out of Medicare in 2012 nearly tripled from just three years prior. According to The WSJ, many other doctors who are not opting out of the program are at least limiting the number of Medicare patients that they treat.

Likewise, a study from the American Academy of Family Physicians reports that 81 percent of family doctors accepted new Medicare patients last year, which was down from 83 percent in 2010.

19% of doctors give you the middle finger up on medicare.

Many more limit the number of medicare patients.

California Healthline says that physicians have several reasons for opting out of the program. Most significant, though, are the low reimbursement rates, concerns about patient privacy, and unhappiness with the government’s increasing involvement in medicine. As far as the increased government presence goes, Becker’s Hospital Review cites the penalties for physicians who do not demonstrate Meaningful Use through EHRs as an example. The WSJ also says that doctors recognize that Medicare payment rates have not kept up with inflation, and that there are dangers of more cuts in the future.

Medicare’s reimbursement rates can be as low as $58 for a 15 minute office visit. According to The WSJ article, doctors are saying that those kinds of rates force them to see 30 or more patients a day simply to stay afloat.

And medicare isn’t cheap.

Base rate 117 a month per person. Imagine a family of 4 for crappy insurance.

Imagine another 200-400 a month per person for supplemental insurance.


http://www.beckershospitalreview.com/finance/number-of-physicians-opting-out-of-medicare-triples.html



http://www.nationalcenter.org/PR-Medicare_Doctors_082012.html
http://thecancerintheamericanhealthcaresystem.com/doctors-refuse-to-accept-medicare-patients.html

No annual limit on out-of-pocket costs. With original Medicare, retirees can expect to pay a Part B deductible, copays and coinsurance amounting to 20 percent of the Medicare‑approved amount for most services. There’s no annual limit on what retirees could be expected to pay out-of-pocket. https://money.usnews.com/money/retirement/articles/2014/02/18/the-hidden-costs-of-medicare
•In Illinois, 18% of doctors restrict the number of Medicare patients in their practice, according to a medical society survey.

•In North Carolina, 117 doctors have opted out of Medicare since January, the state’s medical society says.

•In New York, about 1,100 doctors have left Medicare. Even the medical society president isn’t taking new Medicare patients.

“I’m making a statement,” says Leah McCormack, a New York City dermatologist. “Many physicians are really being forced out of private practice.”

administrative spending protects against fraud. By some estimates, the Medicare program loses a staggering $60 billion to fraud each year. This amounts to 11 percent of the Medicare budget and would be enough to double Federal spending on primary and secondary education. No private company would ever tolerate this abuse. Imagine the fraud if Medicare covered 300 million Americans.

Then there is the supplemental plan costs. People have to buy additional coverage.

But you keep beating your progressive drum and tripe.


#9

The Myth of Medicare’s 'Low Administrative Costs’Medicare is partially administered by outside agencies

First, other government agencies help administer the Medicare program. The Internal Revenue Service collects the taxes that fund the program; the Social Security Administration helps collect some of the premiums paid by beneficiaries (which are deducted from Social Security checks); the Department of Health and Human Services helps to manage accounting, auditing, and fraud issues and pays for marketing costs, building costs, and more. Private insurers obviously don’t have this kind of outside or off-budget help. Medicare’s administration is also tax-exempt, whereas insurers must pay state excise taxes on the premiums they charge; the tax is counted as an administrative cost. In addition, Medicare’s massive size leads to economies of scale that private insurers could also achieve, if not exceed, were they equally large.

Administrative costs are calculated using faulty arithmetic

But most important, because Medicare patients are older, they are substantially sicker than the average insured patient — driving up the denominator of such calculations significantly. For example: If two patients cost $30 each to manage, but the first requires $100 of health expenditures and the second, much sicker patient requires $1,000, the first patient’s insurance will have an administrative-cost ratio of 30%, but the second’s will have a ratio of only 3%. This hardly means the second patient’s insurance is more efficient — administratively, the patients are identical. Instead, the more favorable figure is produced by the second patient’s more severe illness.

Medicare has higher administrative costs per beneficiary

A more accurate measure of overhead would therefore be the administrative costs per patient, rather than per dollar of medical expenses. And by that measure, even with all the administrative advantages Medicare has over private coverage, the program’s administrative costs are actually significantly higher than those of private insurers. In 2005, for example, Robert Book has shown that private insurers spent $453 per beneficiary on administrative costs, compared to $509 for Medicare. (Indeed, Robert has written the definitive paper on this subject, from which the above figure is taken.)

Remember these points the next time someone tries to tell you that Medicare is “more efficient” than private insurance.

UPDATE 1: Tim Worstall points out in the comments that we should also count the deadweight costs of tax collection as part of Medicare’s administrative costs (say, 20% of the amount collected).

UPDATE 2: Benjamin Zycher has also written extensively about Medicare’s administrative costs, as exemplified by this paper for the Manhattan Institute.
https://www.forbes.com/sites/theapothecary/2011/06/30/the-myth-of-medicares-low-administrative-costs/#2f7a6ee9140d



#10

But of course… It could never happen here … and I am sure Bernie’s plan has all the kinks worked out of it…

http://thefederalist.com/2017/09/21/want-medicare-get-used-eating-rabbit-now/

There is one up side to Venezuela’s situation… the population on average has lost 19 pounds… but as we know about communism that effectively wipes out the middle class… Maduro appears to have lost no weight…

I wonder why the population of Venezuela isn’t upset over that fact that the right to free health care is actually written into the constitution…and they ain’t getting it… But of course… as most people figure out over time, there are ‘rights’ that only government can take away… and then their are the vote getting kind of ‘rights’ that have no possible guarantee anywhere.


#11

http://www.concordmonitor.com/Substance-abuse-provider-get-low-reimbursement-from-insurance-providers-3942136

http://www.concordmonitor.com/Substance-abuse-provider-get-low-reimbursement-from-insurance-providers-3942136

FACTS

Trump’s department of justice:

The Department Of Justice Believes United Healthcare Is Defrauding Medicare

https://www.acsh.org/news/2017/02/21/department-justice-believes-united-healthcare-defrauding-medicare-10885

https://www.google.com/amp/healthaffairs.org/blog/2011/09/20/medicare-is-more-efficient-than-private-insurance/amp/


#12

The Obama DOJ… opened in 2010 and sealed for 5 years pending investigation…

The U.S. Department of Justice (DOJ) has joined a whistleblower lawsuit, United States of America ex rel Benjamin Poehling v. Unitedhealth Group Inc., No. 16-08697 (Cent. Dist. Cal. Sep. 17, 2010), ECF No. 79, against UnitedHealth Group (United) and its subsidiary, UnitedHealthcare Medicare & Retirement—the nation’s largest provider of Medicare Advantage (MA) plans. The suit accuses United of operating an “up-coding” scheme to receive higher payments under MA’s risk adjustment program called the HCC-RAF Program (see below). The complaint alleges that United fraudulently collected “hundreds of millions—and likely billions—of dollars” by claiming patients were sicker than they really were. The suit was originally filed in 2011 by a former United finance director under the False Claims Act (FCA), which allows private citizens to sue those that commit fraud against government programs. Pursuant to the FCA, the case was sealed for five years while the DOJ investigated the claims.

By the way, can you not find any ‘adda boy’ articles for medicare that aren’t 6 years old?


#13

There is no convincing the shills of single payer (progressives) that medicare is a very expensive insurance program.

Most people are clueless thanks to the left and the media what medicare actually costs.

Part A premium
Most people don’t pay a monthly premium for Part A
Part A hospital inpatient deductible and coinsurance
You pay:
$1,316 deductible for each benefit period
Days 1-60: $0 coinsurance for each benefit period
Days 61-90: $329 coinsurance per day of each benefit period
Days 91 and beyond: $658 coinsurance per each “lifetime reserve day” after day 90 for each benefit period (up to 60 days over your lifetime)
Beyond lifetime reserve days: all costs

Part B premium
The standard Part B premium amount is $134 (or higher depending on your income). However, most people who get Social Security benefits will pay less than this amount ($109 on average).
Part B deductible and coinsurance
$183 per year. After your deductible is met, you typically pay 20% of the Medicare-approved amount for most doctor services (including most doctor services while you’re a hospital inpatient), outpatient therapy, and durable medical equipment.
Part C premium The Part C monthly premium varies by plan. Compare costs for specific Part C plans.
Part D premium The Part D monthly premium varies by plan (higher-income consumers may pay more). Compare costs for specific Part D plans.

Of course the costs are per person.


#14

Wow, a great start to solving our over weight/obese population.


#15

I’d love for a full repeal but it’s just not going to happen, Obamacare brought in a devastating and nearly irreversible policy.

Now that you cannot discriminate against pre existing conditions it’s damn near impossible to get enough support to get rid of it even though it’s the reason Obamacare is so expensive.


#16

No, that’s not why it can’t be repealed. It’s because republican alternatives to the PPACA are hugely unpopular and even with control of the White House and both houses of congress, the GOP can’t get it done.


#17

A new study published by the Mercatus Center at George Mason University illuminates the enormous fiscal stakes of recently suspended efforts to repeal and replace the Affordable Care Act (ACA). While lawmakers must consider a number of important value judgments—affecting the health and income security of millions of Americans—in the context of any future healthcare legislation, they cannot responsibly ignore the implications of healthcare policy for federal finances. The ACA has significantly worsened the federal fiscal outlook, and efforts to repeal and replace the law represent a critical opportunity for much-needed fiscal corrections.

Mercatus Senior Research Fellow Charles Blahous examines the effects of different variables that could push the projected budget savings from repeal-and-replace either higher or lower than current projections. His analysis expands upon the estimates of the Congressional Budget Office (CBO), which is charged by Congress with producing a single best-guess estimate of the fiscal effects of legislation, and which must follow certain scorekeeping rules that occasionally diverge from current law and policy practice.

Blahous presents three scenarios ranging from partial to full repeal of the ACA, considers how different assumptions could impact fiscal outcomes, and produces a range of estimates resulting from each variation. His study also includes an addendum that applies the same methodology to examine the range of possible fiscal effects of the American Health Care Act (AHCA) as introduced.

KEY FINDINGS

Repealing the ACA will, considered in isolation, substantially reduce future federal deficits.
Repealing the ACA’s various spending and tax increases, effective next year, could reduce federal deficits over 2017–2026 by $228 billion to $1.07 trillion.
One example of repeal-and-replace legislation, the AHCA as originally introduced, could reduce federal deficits over 2017–2026 by $42 billion to $657 billion.
The amount of deficit reduction depends on several key assumptions and legislative variables, including the effective dates of repeal provisions, the specifics of replacement provisions, and which ACA provisions are repealed, modified, or retained.
It is likely that the practical fiscal improvements from repeal will exceed those projected by CBO, although budget savings could be either underestimated or overestimated. The greater likelihood of increased budget savings is not primarily attributable to CBO projection error, but rather to Congress’s patterns of legislative behavior and its scorekeeping rules.
ACA repeal legislation would improve federal finances irrespective of whether it repeals the ACA’s Medicare cost-containment provisions. Lawmakers are unlikely to repeal these provisions, however, because doing so would significantly accelerate the depletion of the Medicare Hospital Insurance (HI) trust fund.
The net fiscal effect of the ACA has been far more unfavorable than initially projected, primarily because several of its financing provisions have not been implemented as originally enacted, because they were repealed, suspended, postponed, scaled back, or weakened in regulation.
SUMMARY AND CONCLUSIONS

Under assumptions consistent with CBO’s, repealing all the ACA’s new spending and tax provisions effective next year would reduce federal deficits over 2017–2026 by $586 billion.
If the ACA’s Medicaid expansion costs have been underestimated, if its insurance marketplace rules are included among those repealed, and if one assumes that the “Cadillac plan” tax, the medical device tax, health insurance fees, and the Independent Payment Advisory Board (IPAB) remain inoperative, the savings from repeal could be as much as $1.07 trillion.
If, on the other hand, the ACA’s Medicaid “woodwork” population has been underestimated and the ACA’s exchange enrollment overestimated, and if the ACA’s cost-sharing subsidies would have been terminated without legislation, the savings from repeal could be as little as $228 billion.
A similar analysis of repealing the ACA’s coverage expansion provisions alone (leaving its other tax increases in place) finds that the fiscal improvement over 2017–2026 could be as little as $878 billion or as much as $1.377 trillion, surrounding a midpoint estimate of $1.236 trillion.
ADDENDUM: THE AMERICAN HEALTH CARE ACT

CBO scored the AHCA (as introduced) as reducing federal deficits over 2017–2026 by $337 billion.
If the ACA’s Medicaid expansion costs have been underestimated, and if one assumes that the Cadillac plan tax, the medical device tax, health insurance fees, and IPAB remain inoperative, the savings from the AHCA could be as much as $657 billion.
If instead the ACA’s Medicaid expansion enrollment and exchange enrollment have been overestimated, savings under the AHCA could be as little as $42 billion.
Under all three scenarios Blahous describes, the AHCA’s repeal of the ACA’s Medicare HI payroll tax increase would accelerate HI trust fund depletion. This would increase the deficit reduction over 2017–2026 from $337 billion under the CBO baseline to $374 billion under Medicare law, based on specifics provided within the CBO score that suggest trust fund depletion in 2026. Adding other less specific information from the CBO report suggests that depletion could occur in 2025, resulting in budget savings under the AHCA ranging from $92 billion to $707 billion from 2017 to 2026, around a midpoint estimate of $424 billion.

The incrusting thing is that it will continue to add to the accumulating debt yet no one (citizens) could care less. The day of retconning will come and the finger pointing will begin.

p.s. think this is bad, wait for the dems savior, single payer which will hasten the pace to insolvency.