July 10, 2013

While still an Illinois Senator making his first bid for the white house, President Obama repeatedly ensured Americans that we could be a nation which provided universally-affordable health insurance to every citizen.  Here we are six years later, at the cusp of enforcing the Affordable Care Act, and once again in prime position to do the exact opposite.  While there's no arguing that some people will, in fact, benefit from health care reform (most notably the unemployed, the sick and the poor),  the rest of the working class will pay for it dearly.

The plain-as-day truth is that, for most people, there is absolutely nothing "affordable" about the Affordable Care Act.  The already gasping-for-air middle class is going to be hit hard with premium increases and fines unlike ever before, while others enjoy the benefits of free or significantly-discounted coverage.  This is not speculation.  Major carriers have already stated that increases are coming, though the specific numbers are not being released. 

Here are just a few reasons why Obamacare is anything but universally-affordable:

Across the Board Premium Increases

How quickly we seem to forget that nothing, save nothing, in this life is genuinely free.  The government health insurance subsidies  which will allow the poor and unemployed to receive coverage, will be funded mainly by sharp premium increases to those who do not meet the poverty requirements. Considering that the majority of the middle-class accounts for this demographic, it's clear to see just who will be on the business-end of these rates increases.

Individuals and families--many of whom can barely afford their premiums now--can expect to see increases in the 100-300% range, or one to three times what they're currently paying.  To give you a better idea of how costly the Affordable Care Act is, keep in mind that doubling, even tripling current premiums, among those in the middle class would still not be enough to cover the expenses of US healthcare reform.

Increased Borrowing

If there is one universal truth in the subsidized health care debate, it is that we as a country, do not have the money to pay for it.  That's no problem, though.  Because as Uncle Sam has done so many times in the past, when the funds don't exist to cover their latest brainchild, our gov't does what every good American does; they borrow it.  This is exactly what we're already seeing with Obamacare. 

The cost of guaranteeing everyone (who can't afford it) health insurance coverage, does not come cheap.  In the case of the Affordable Care Act, the tab will be covered from three key funding sources:

  • Premium increases for families and businesses
  • New 2014 Health Insurance Tax of 4.5%
  • Federal borrowing (for healthcare subsidies)

Having the luxury to create fake (yet somehow real) money on a computer screen, is absolutely great until it needs to be paid back.  In this case however, taxpayers are the ones charged with repaying the debt.

Keep in mind, though, that creating billions of pseudo-dollars to fund a program that only benefits a tiny sliver of the population, speaks volumes of why America is in the shape it's in.  Because when you look at other past federal undertakings (social security, Medicare, war estimates, housing), every single one of these has a track record of either total failure, grossly-exceeded budgets, or both.

Taking the Good with the Bad

We're not saying that universal health care is a bad thing for everyone, because for many, it will be a Godsend.  But when the backbone of the population is forced to endure yet another financially-demeaning blow in order to make it happen, nothing has been fixed.  All that's happened, is the exchange of one severely-burdened group for another.   

In addition to the very poor and unemployed, another group who stands to benefit the most are those who currently pay astronomical rates for coverage, as a result of past illness or injury.  Their rates are expected to decrease in comparison to what they were paying.  Businesses will also have a bit of temporary breathing room.  In July 2013 the treasury announced that companies with 50+ employees, would be given an additional year of exemption from fines and penalties.  And while this is clearly a plus, one can only wonder why The People aren't being treated with the same federal benevolence.

So yes, there are some groups who will benefit immensely from subsidized government health care.  But not all will, and this makes the term universal healthcare an oxymoron.  The only thing universal about it, is that everyone will be forced to have coverage, regardless of how thin their household dollar is already being stretched.  And when the backbone of the population is forced to endure another financially-demeaning blow in order to make it happen, a fundamental part of the system remains unquestionably broken.