Will the HCR law help the uninsured?

I was reading Sam Stone’s post’s in this thread, and I noticed that not many people were responding to them. It got me to wondering… is **Sam **misrepresenting things or are people just not familiar with the impact of this law?

Here’s a sample from Sam:

So, the question is: Now that a bunch of not-so-wealthy people will have to buy HCI, will they be better off financially once this law fully kicks in?

Now, I’m not talking whether they’ll be better off if they suddenly need some expensive health care and finally get it due to having insurance. That doesn’t happen to everyone. Will they have more or less disposable income at the end of the day? Seems to me that if you’re forced to buy something you didn’t already have, you’re going to end up with less money.

Am I missing something? Or, are we just saying, as **Diogenes **put it in that thread:

Sorry about the tread title. It should’ve been something like: How many people will end up hurting, financially, because of the HCR law. I didn’t mean to leave it so open ended like that.

We don’t know. We are operating with the confidence that whatever needs be fixed, can be fixed, and that we cannot know everything in advance.

What if the insurance companies decide that they can’t make the sort of profits they want, and decide to bail? Well, then, we will have to whip up a public option toot damn sweet, no? Luckily, I think there are some plans lying around the office…

Now, as I noted in another thread, publicly they’re saying that they are born again with civic pride and an eagerness to help. We’ll see. I do love a miracle.

Some asshole is going to connive and scam an advantage out of this wholly undeserved. You can bet on it. Some wholly deserving person is going to fall into a shadow zone, and get screwed. But that’s happening right now, and this is an effort to change that.

Its risk taking, isn’t it? And that’s the American way, or at least thats the American way when it comes to grabbing bucks. Don’t see why its any less American when it comes to helping Americans.

Here, you can calculate your own subsidies.

So if you make 22k a year, you’ll have to pay 1,400$ (I used my own age). Which seems like sort of a rip off, except your getting a plan that costs 2,700. So depending on how you look at it (and whether you were going to buy insurance anyways), you lost 1,400 dollars or gained 1,300. But its certainly not clear-cut that you’re loosing out.

Yeah, that’s pretty much what I was thinking. So, if you’re uninsured by choice, you’ll probably be pissed. If you’re uninsured not by choice, and have some extra dough to cough up, then you’ll probably by happy. If you’re uninsured not by choice, but don’t have extra dough to cough up, you’ll probably have mixed feelings.

elucidator: You may very well be correct, but that scenario would play out beyond the timeframe I’m thinking about for this analysis. However, I think the more likely case is that the insurance companies will be hiring some really smart financial types to get around the provisions in this bill that adversely affect them, and they’ll survive just fine.

Well, remember a lot of this does not kick in till 2014 and the penalties for not having insurance ramp up from 2014 to 2016.

So, we cannot know a lot of this till then.

For the purposes of this thread, I would say we should assume that the law is enacted as it is currently designed. It’s not like the millions of Americans who currently don’t have HCI are suddenly going to get it for free.

The thing is people will always choose the least expensive coverage. Therefore they won’t be covered on somethings, and wind up in bankruptcy or passing the expense onto the insured.

The law also allows for opt outs for buying coverage, such as those with religious objections and Native Americans on reservations and such.

What galls me is the press keeps calling it UHC (Universal Health Care), this doesn’t come close to it.

It’s like mandatory car insurace. People choose the least expensive just to stay in the law and if if they get in a wreck the other guy’s screwed because of his poor insurance.

The point of this bill is simply to give Mr Obama a “good mark” it does nothing to solve the problem.

The fact it will take four years to impliment means insurance has 4 years to think of creative accounting to get around it.

Did the new credit card laws help anyone? Or did the banks simply drop everyone and cut everyone’s credit limit regardless if they were bad risks. ABC News reported in January and Feburary the fees and interest rates more than tripled from the previous years.

Mr Obama started out on a correct path and he couldn’t get it done. So to save face he adopted this mess, which won’t really help anyone. I mean the poor get medicaid? Ask any poor person right now on medicaid how good it is?

Illinois is a great example, children under 18 are covered by the state. Every month we hear report after report of parents not taking their children, 'cause the dentists and doctors are such poor quality they only take them as a last resort.

I’m sure you are right about them being pissed, but the reason for this type of uninsured person is that it is not financially optimal for them to buy insurance - for them - while them not doing so creates higher costs for others. That they inevitably will become one of these others (if they live) is why the mandate is morally justifiable.

When computing how much these people lose, you need to include the value of insurance, which is never 0, even to the healthiest. You need to include payments for doctors visits they might make, insured or not, and the expect value of illnesses based on the probability of someone in their demographic getting sick, multiplied by the expected cost. I’m not saying this makes purchasing insurance a good deal, just not as bad a deal as it might seem at first blush.

Its estimated to increase the number of insured in the US to something north of 95%. Not Universal, but certainly much closer then the current situtation.

Well, the other guy in this case is your own internal organs, so I’m not sure the analogy holds. But in anycase, the legislation requires that insurance meet some minimum coverage requirements. So going with the “cheapest” option should be fine.

It decreases the number of uninusred. So it does do something to solve the problem.

The law that was passed was pretty close to Obama’s original proposal. Remarkably so, considering the contortions it went through to become law.

When running these numbers, I have to say, I think there’s a… mmmm… call it good 80% chance we’re going to get a honest try of getting a Public Option in, in the next year or so, especially if the Dems keep the House. (Or even maybe just before elections. Good way to get out the vote.)
If so, it’d kick in probably around the same time as the rest of the plan. How would that change things?
I figure there’s maybe a 30% chance of the public option passing in the next two years.

I was talking about people w/o insurance by choice. There are lots of single people out there who are unlikely to need to see a doctor in any given year. Especially males.

From what I understand you could still avoid the horror (and most of the expense) of having to get mandatory health care (and there are some exceptions in the system in any case that are built in…religious reasons, Native Americans for some reason, a couple others) by simply paying the penalty, which I think has gone down somewhat in price (IIRC, it was going to be over $700 and now is going to be under).

What I’d like to know is how they are going to keep businesses from chopping their health care to their employees, since I think the penalty (which was raised in the reformed bill) is a flat fee (yearly? I’m not sure, does anyone know?) of something like $2k per employee. That sounds like a lot, but unless they are going to charge that a month, a lot of companies are going to see a huge advantage in cutting their health care and saving a bundle while letting their employees fend for themselves and use the future government group plans.
To answer the OP, I’d say that it will probably be a wash for the currently uninsured…it will help some (many really) and hurt others. My sister and her husband don’t have insurance (ironic, considering both of them are in the health care field), but they are also on a really tight budget due to some bad luck and worse planning on their parts. Perhaps this bill will force my brother in laws company to now offer health care, but he doesn’t seem sanguine about that…nor does my sister and wrt to her employer. So, they are going to have to find some or pay the penalty. Eventually, from what I understand, there will be group policies available, and of course there will be some government assistance, but, unfortunately for my sister and her family, they make too much for a lot of the assistance. She is still a huge Obama fan, and still in favor of this bill as a solid first step, but I know she is worried about how all this will play out.


What I was really wondering about was how many people who supported this honestly thought they were getting free health care, or at least much cheaper health care. And if lots of them did, what is the political result likely to be? Will many of them simply not get insurance, then be unable to pay the fine when they get it? Will there be even more opposition to the plan as these details surface?

One of the problems with this bill is that it was really a giant Rorschach test. The details of it were not available while the debate was going on, so everyone was seeing what they wanted to see - on the right and left. Once the regulators have worked out the specific details of the bureaucracy and it’s put in place and the reality of it sets in, people may find it’s not what they thought it was.

And the problem with making all these last-minute changes with only days or weeks of analysis is that it means there are going to be a whole lot of surprises and unintended consequences. This has already started.

For example, this working paper says that there’s a huge differential in the subsidy available for private individuals vs the subsidy the businesses will be eligible for, which will create a huge disincentive to maintain employer-based health care. If the paper is correct, a family of four with a $15,000 health care plan with a $5500 cost-sharing deductible would receive a subsidy of $2295 through the government’s support of their employer health plan. But if they insure themselves through the health exchange, they’ll get a 19,400 subsidy for their own health care. This giant subsidy differential means employees will have strong incentive to negotiate with their employers to receive additional pay instead of health insurance, then use it to pay for their own health care through the exchanges, and come out way ahead. You might even describe this as a wealth transfer to the people who currently have employer health care - by taking salary instead of health care costs, they would wind up with essentially an income supplement from the government, to spend as they wish.
If that’s true, there could be a flood of people away from private, employer provided insurance and heavily subsidized insurance through the health exchange. This will blow up the cost, distort the job market causing misallocations, and probably lead fairly directly to a model where almost everyone gets their insurance through the public exchange. It will be single payer, except instead of the money coming directly from the government, it will be provided by the health insurers, who act not like insurance companies but regulated public utilities. They’ll just be the bureaucracy that administers the program on behalf of the government.

Another unintended consequence: Today the AP had a wire story on companies saying that the new health care bill is going to cause them to drop prescription drug benefits from its retirement plans, because the removal of the subsidy they were getting (about 5.6 billion dollars) will make it too expensive. As many as two million people may be moved out of private drug coverage and into Medicare Part 2. Many will land in the ‘donut hole’ and lose their coverage entirely. And if the government wants to close that hole, the costs for doing so may be higher than anticipated because of the sudden influx of persons away from private health insurance. The net result of this is that the health care plans supposed savings of 5.6 billion by eliminating that subsidy will likely have to be spent shoring up the donut hole as those people move from one plan to the other. There’s no free lunch here.

Caterpillar, John Deere, and another company I can’t remember said that the reform package was costing their three companies a collective $265 million, and that a number of unspecified changes were going to have to be made (salary cuts, workforce cuts, or benefit cuts, probably) to remain competitive.

I gotta grant you, I don’t know this shit, any more than any other smart-ass hippy in a double wide. Maybe the questions don’t exist outside of my fevered imagination but! how much money did they lose in the Recent Unpleasantness?

Insurance companies, pension funds, that ilk, they are the very incarnation of fiscal responsibility. They are not to embrace risk, but to avoid it, prudently. If they put the money they are “fiscally responsible” for in anything less than Triple A bonds, well…

Ah, yes, Triple A rating, the gold standard, the rock solid. Of course, rock solid usually means lower return. For good reason.

All of that money, all of that “liquidity” between rock solid and what was being sold as rock solid…all of that money has vanished. Not so much squirreled away as weaseled.

Pension funds were managed by conservative shepherds, who would not risk. As were the funds of endowments to philanthropies. The most conservative of investors took it in the shorts.

Is it not reasonable to expect that the insurance companies did also? Is that why they put up such a death struggle over this? Because being forced to a modest but secure profit is doom?

I’m trying to think of an instance when a huge corporate entity just shrugged its collective shoulders and gave up, rather than fight the good fight with accountants and lawyers. Maybe this will be the first…

More evidence: AT&T to book 1 billion in costs in the first quarter as a result of the health care plan. In total, U.S. companies may lose $14 billion in profits as a result of the legislation. That will come right out of dividends paid to shareholders or stock prices.

The article talks about AT&T probably cutting benefits.

This is just incorrect. Anyone with an internet connection or a library card could not only read the content Senate bill for MONTHS before the vote (there’s a table of contents and everything!), they could read various partisan and non-partisan summaries of what the bill does. The reconciliation language and summary were not online for as long, but they were available for several days, and you don’t seem to be complaining about those provisions anyway.

You’re conflating unintended consequences of intentional policies (such as provisions intended to move the country away from employer-based care) with unintended or unconsidered provisions of the bill. You conflate these concepts because it fits better with your world view, in which ham-handed government bureaucrats ignore basic principles of economics to force change they don’t understand, when in fact it is just that reasonable people can disagree about the economic consequences of any sufficiently complex policy.

This bill is going to squeeze a lot of people who had been responsible for their health care, too. We have an HSA/HDCP combo, which we will be unable to afford after the minimum covered care mandates and deductable max kicks in. As I have stated elsewhere on this board, this is a solution which works perfectly for us, protects everyone else from picking up our slack, and demands that we be engaged in our healthcare decisions.

So, after 2014, we’ll be pushed into the Exchange. The numbers estimate that we will have to pay $8,543 a year, and are not eligible for any subsidy. That is at least $1500 more than we pay between our HSA/HDCP now, and will not cover dental or vision, which we need far more than medical visits. So, for my family of four, with four sets of teeth and four sets of eyes, we’ll have to come up with another $2000 or so a year.

Yea - we got screwed on this. It’s very easy to say “well, you can afford it!” but when you strip this down, in many cases, people can’t afford it. Our income level is just over the limit for subsidies, but we still shop at Aldi and KMart, sit on an old futon and drive old cars. We manage to save about $100/month, which will in no way cover our New and Improved health care mandate.

It’s strange - money isn’t worth what it once was. I’m sure that our household income would make people very happy, but in the reality of the middle class, it’s not. We don’t piss money away - eat out (ever), buy a lot of WalMart crap, lease a new car every three years, etc. Our luxuries are few - once a year vacation (driven, not flown), a date for for me and hubby once every few months, a house (that needs some work), etc.

I really think the middle class is going to take it on the chin with this one. Low income households will get help, high income households won’t feel the sting. But we’re screwed.

The Kaiser calculator cautions:
“In many cases coverage will be more comprehensive and accessible than what is typically available today in the non-group market, so premiums cannot easily be compared to what people buying insurance on their own are now paying.”*

It and other calculators I have seen seem to be pretty general and probably do not reflect the eventual situation.

The one from Kaiser has a bit of fine print that points this out - it is based on a fairly comprehensive ‘Silver’ plan with an assumed base cost and has only 3 ‘geographic’ adjustments. Your rates will be set for your state/area and will probably be different.

In actuality, there will be four levels of plans - Bronze, Silver, Gold and Platinum - and HSA/HDCP plans will still be available (if allowed by your state).

deleted – jasg already made my points.