Thursday, April 18, 2013

Obamacare's Federal/Big Insurance Utopian Dreams

A couple of months ago, I hypothesized about a possible collusion between the federal government and prominent health insurance companies.  I stated they would find a way to incorporate a Federal Reserve like system that would sanction and protect companies like Blue Cross and Blue Shield, while they in turn ceded power to the federal government.  It looks like my hypothesis is coming true.
The Progressives have an additional bonus.  They are realizing their Marxist dreams:  from each according to his abilities, to each according to his needs.  Carolina Journal reported the following:

Devon Herrick, senior fellow and health economist at the Dallas, Texas-based National Center for Policy Analysis, said his organization expects major restructuring of the health insurance market over the next decade, and lots of employers to start dropping coverage nationally due to Medicaid expansion and subsidized health exchanges.

“We predict a lot of firms will find a way to get out of providing coverage,” Herrick said.

“I suspect that we will see employers taking a wait-and-see approach,” Allen countered, with none wanting to be the first to drop its insurance coverage benefit even though it would be cheaper to pay the Obamacare tax penalty for not providing insurance than to pay the employer share of insurance premiums.

“I think a lot of people are carefully watching what employers do, and especially what the larger employers do,” Allen said.

“All the products on the exchanges have to be qualified health plans,” and insurance carriers are required to provide the same “scope of coverage,” he said.

“We’ll be offering a full choice,” he said, “to make sure consumers get the products they want. They’ll look a lot like our products look today.”

Blue Cross would slot buyers into different medal levels descending from platinum and gold to silver and bronze. The higher levels would have richer coverage and higher costs, Allen said. “Bronze covers less of the total cost than, say, a platinum does.”

As a general rule of thumb, Blue Cross would offer “the same set of products to folks regardless of their income level,” Allen said. “So a bronze plan will be the same for someone at 20 percent of the federal poverty level as someone at 400 percent of the federal poverty level.”

The difference would be in awarding higher subsidies to lower-income individuals to offset premium costs.

“Obviously lower-income gets a bigger subsidy. Folks making less than 250 percent of the federal poverty level get a richer option if they choose a silver plan,” Allen said. “The plan has less out-of-pocket costs for the customer.”

So basically, the rich will pay more for health insurance while at the same time subsidizing the care of others who can’t afford the Obamacare premiums.  Who knew utopia was a federal government program away?

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