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Friday, October 4, 2013

By Michael Mccune: The Rant (US Government auditor for 16 years In Cheyenne, WY. - Healthcare Law Reveals More Problems- (( to Have Michael send you the Rant to your Email contact Him Here (( mccrant@gmail.com))

Healthcare Law Reveals More Problems

There are some simple reasons why the Republicans in Washington should continue to fight the Affordable Care Act with every fiber in their being, despite the criticism coming their way from the media, Obama and Democrats near and far.

 

The fundamental flaws in Obamacare are noteworthy but today only a couple of the problems are in the cross hairs. Problem 1 is: Under the ACA, children under the age 26 can remain on their parents' insurance. Problem 2 is: Funding for the ACA simply doesn't reach any of the levels the Congressional Budget Office or General Accountability Office have projected, even if everybody signs up.

 

Here are some of the troubling statistical aspects of Problem 1.

 

On average, 55% of the "children" now eligible to remain on their parent's health insurance plan have children of their own and 43% of all births in this age bracket were to unmarried mothers.

 

In the language of the bill, since these babies are to be placed under the 'parent's' plan, since the parent is still under his/her parent's plan, does this mean you can have three generations of a family under the same insurance plan? Some individuals immediately pointed out as new parent's they need to get their own healthcare insurance plan. The law doesn't provide for this.

 

The problem has been foreseen by insurance companies. Having worked for insurance actuarial tables in the past, I know of no actuarial plan that accounts for this larger family size or length of children's stay on the plan. Where the average family plan does account for 3.3 people, there would have to be massive adjustments to account for an average of 8 people per family plan.

 

The plans all have deductibles--costs the family have to pay for. In current terms, a $2,000 deductible means the family would have to experience a very abnormal years to use up all of their deductible. But with more than double the number of individuals on a family plan that deductible will be surpassed by most policy holders. Insurance companies will have to increase premium costs dramatically to cover these additional family members under the new definitions.

 

Another fact over looked by the crafters of the ACA is 1% of all Americans consume 22% of the current health care dollars and the top 5% of medical users in this country consume 50 cents of every dollar spent on health care. The top 1% are normally in the 'pre-existing condition' category and that is why insurance companies couldn't cover them--their consumption would skew the actuarial table costs too much for everyone else.

 

The stats just listed should really spook the average American considering healthcare accounts for one in every six dollars spent in this country in the average year. Think of it this way, whereas the 4% below the top 1% of medical users in the country now use 28 cents of every dollar and most of those are barred from insurance coverage, now the remaining 95% (one of every 19) will have to pay to cover those individual medical costs--either through their premiums or through government penalties.

 

Based on the fact the health industry consumes one of every six dollars, the government--to break even--will have to allocate $1 trillion more each year of its revenue to medical than it did before the ACA provisions. This will be through the "coverage subsidies" an estimated 84% of the country will be eligible for--not including exemptions from the bill already granted. And the government was already operating in a deficit mode!

 

Unfortunately, we now come to problem No. 2 listed above.

 

The very people Obama is aiming this plan at are the young people. Up to age 26 they can stay on their parents. If their children can then be passed on to Mom and Dad until age 26 themselves, where is the incentive for the 26-40 crowd, normally the healthiest sector of society, to sign up for medical insurance?

 

Every pundit opining on the ACA has made it clear the supporters of ACA are going to have to have the young adults sign up in droves--both to get coverage and to obtain the necessary funding for universal coverage for the population and especially for those with pre-existing conditions. Then the bill removes the incentive to do so.

 

Insurance companies were brought to life to spread the cost of liability for any particular endeavor around to a greater group where the chances were the majority were not going to file a claim. They operated with a profit in mind. ACA removes the possibility for a profit and assures costs must go up for the 95% because those who are in need will assuredly obtain coverage now.

 

Oh! the "there will be penalties" statement for not getting insured sounds fine. The IRS will gladly withhold the penalties from tax refunds but all the taxpayer has to do to avoid this is simply make sure he has paid at least one dollar less than will be required on the normal income tax. No refund application means the IRS has nothing to withhold and the "Service" has no authority to penalize someone for slightly underpaying their taxes yet.

 

Following Nancy Pelosi's lead, Congress "passed the bill to find out what was in it" It is an economic disaster-in-waiting.

 

With the problems becoming clearer every day, the House Republicans must stand tall and not allow the government to reopen until Obamacare is junked or at least severely tweaked and all preferential exemptions expunged.

 

If the House wants to hasten the country's economic meltdown, all is has to do is cave and give "law of the land" its' approval.

 

"I have sworn on the altar of God eternal hostility to every form of tyranny over the mind of man."--Thomas Jefferson 

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