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Nancy Smith

Obamacare 'Subsidies': Beware the Inflation Maker

October 26, 2016 - 6:00am

It's not so bad, says the Obama administration. So what if health insurance premiums under the Affordable Care Act are going up in 2017? No biggee. Most people affected will get increased subsidies to make up the difference. Problem solved.

This is how the Democrats think. The federal government will take care of you. Various Dems were talking about it all day Tuesday on CNN and National Public Radio. 

As if increasing subsidies has no consequences. 

Allow me to tell you what increasing subsidies for Obamacare means: As I see it, it means one of at least three things: 1) the majority of the increase comes out of taxpayers' pockets; 2) Medicare recipients pick up a sizable chunk of the tab -- if not next year, then the year after that; 3) the government prints more money, record inflation ensues.

Or all three. It's only a matter of time, and that's what I fear the most.
 
Let's look at this increase.

On average, the middle tier of coverage options, which is what the subsidies are based on, will rise by about 25 percent. That's not just a big increase on its own. In some states, Arizona for instance, the increase is more than 100 percent. And it's a far larger jump than we've seen previously: Last year, while the Obamaites were enticing young people to sign up, they kept mid-level plan increases at about 7.5 percent.

In other words, this isn't business as usual. And while the premium increases will vary by region, they're not limited to a few select states or counties. Oh, yes, and thanks to the exit of multiple major insurers from the law's exchanges, anyone seeking coverage next year will have fewer choices.

The bottom line is, the government (read, you and me) will be paying for subsidies, and so the total cost of the law to the public will go up. Not only that, but many of those who are insulated from the premium increases will still lose their insurance plans as insurers drop out of the market, and may end up picking a new plan that doesn't cover their current set of health providers.

"We think (the average Joes facing an increase) will ultimately be surprised by the affordability of the premiums, because the tax credits (or subsidies) track with the increases in premiums," one Health and Human Services official told NPR.

Ohhh. Then we're all right?

No. No one is all right.

For a start, this does nothing for the people who are not subsidized under the law -- in particular, the individuals who are just above the subsidy cutoff of 400 percent of the poverty line. That's who former President Bill Clinton was talking about when he complained recently that Obamacare is a "crazy scheme" that "doesn't make sense." Those people will bear the full brunt of the premium increases themselves -- or choose to remain uninsured and pay a penalty.

Obamacare's fundamental problem is that too few people have signed up, and in particular too few healthy people have signed up. Exchange enrollment last year came in about 40 percent below the Congressional Budget Office's predictions.

Understand, too, that the subsidies won't insulate individuals from premium increases forever. Subsidy caps that will require consumers to pay a greater share of their income kick in starting in 2019.

Thank God for the American economy, certainly. But what a blow to affected individuals living on the edge.

Obamacare is every bit the ruinous fiscal monster Republicans say. If Obamacare continues unchecked, something -- some form of payment to insurers and health care professionals -- will be needed to replace subsidies.

What Monday's news makes clear is that premiums are going up, and the number of available plans is going down, and as a result, many middle-class people will face a choice between paying dramatically higher rates for their remaining choices, or paying a tax penalty for the privilege of remaining uninsured. For these people, I'm thinking, nothing the administration has said or done will be sufficient to excuse what Obamacare has become. 

Meanwhile, in four years economists say we could be looking at a national debt of $26-$30 trillion. I don't like saying it -- I don't want to be the doommonger -- but I fear the household word on our lips during the next presidential cycle very well could be inflation, with bankruptcy the word we dare not utter.

Reach Nancy Smith at nsmith@sunshinestatenews.com or at 228-282-2423. Twitter: @NancyLBSmith

Comments

Bye bye Obama,..Good riddance to bad garbage ! It's almost time for us to repel, repeal & replace "mooslum-medicare", and correct a plethora of "Alinsky theories" put in place by this half-azzd presidential poser !

Where is the NEWS on this story? Obama and Clinton DNC are promoters in chief of ELECTION FRAUD and TAMPERING! Proof on this video. BREAKING REPORT: HILLARY'S VIOLENT OPERATIVES UNMASKED ON VIDEO AT THE SCENE OF THE CRIME type this in you tube

This is only one small part of why Democrats cannot be trusted in leadership roles. Two other examples come to mind; Obama & Clinton. GO TRUMP!!

What Nancy doesn't tell you is republicans have blocked cost cutting moves and really, stopped governing at all as they control Congress that make the laws.......... For instant where is tax reform? .......... Where is truth in medical costs bills so we can compare ? ........ Why do they force the government to pay list prices for drugs, the main reason insurance rates , medical costs are going up ? .......... They can blame anyone they want but republicans are those making costs go up far more than needed.

Grow up, little jerryd!

Is anyone surprised? It's just part of the Soros game plan for federal government control of everything. Welcome to the Brave New World, Comrades.

Comments are now closed.

nancy smith
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