Video: The coming price explosion of ObamaCare

posted at 3:05 pm on August 16, 2011 by Ed Morrissey

If you think ObamaCare is expensive now, just wait until people and employers really understand the federally-mandated state exchanges and subsidies. Reason TV interviews Glenn Morton, author of Passing ObamaCare, which exposes the giant financial hole that ObamaCare will create when the incentives become clear:

In projecting the program’s costs, the Congressional Budget Office figures that about 7 percent of the workforce currently covered by employer-provided insurance will drop those policies and sign up for the subsidized insurance. That estimate – and hence, the cost structure of the program – has been challenged by sources such as McKinsey & Company, the consulting firm, which reckons a far higher percentage of workers will opt out of their current job-based plans. In a survey of employers released in June, McKinsey found that 30 percent will “definitely or probably” drop their coverage as Obamacare kicks into high gear in 2014. Among “employers with a high awareness of reform, this proportion rises to more than 50 percent,” says the report. Why? It will be cheaper to pay fines than to provide coverage.

If those estimates are accurate, the cost savings ObamaCare supporters tout are a pipe dream.

Glenn Morton, the author of the new book Passing Obamacare, has worked for nearly two decades in the health-insurance business, most recently as a broker who helps employers find better deals among providers. In a discussion with Reason’s Nick Gillespie, Morton adds another problem with recently released Obamacare rules: The mandate to reduce the percentage of insurance costs that go to administrative costs effectively means that insurance brokers’ commissions will be either drastically cut or reduced altogether. If brokers’ role in hunting for better coverage plans is eviscerated, argues Morton, companies will lose their main ally in the search for affordable and dependable coverage plans. The result, says Morton, will be that more and more companies will cease to offer insurance, thus driving even more people into the insurance exchanges and the cost of Obamacare up and up. CBO says the cost of giving subsidies to 16 million individuals over Obamacare’s first decade will be $466 billion alone.

In the interview, Morton says that “2014 is when our country changes substantially.” His explanation shows why the country needs to change its leadership substantially in 2012 to avoid the consequences of ObamaCare.

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IF ObamaCare is still around in 2014, people will be screaming for it’s demise. They won’t be able to afford coverage, and neither will the government.

GarandFan on August 16, 2011 at 3:09 PM

Second look at the oil rigs countries?

Oil Can on August 16, 2011 at 3:09 PM

…Treasonous.

singlemalt 18 on August 16, 2011 at 3:10 PM

if i get any more hope and change, i’m afraid it may kill me

DrW on August 16, 2011 at 3:10 PM

Taxing the rich will pay for everything.

Bishop on August 16, 2011 at 3:12 PM

Why are repeating the mistakes made by National Socialist Europe?

Aren’t thing bad enough over there to give us pause in doing the same thing?

Chip on August 16, 2011 at 3:13 PM

Why are WE repeating the mistakes made by National Socialist Europe?

Chip on August 16, 2011 at 3:15 PM

True…

… and the bureaucracies will be entrenched. The federal employees union will fund politicians to guarentee cadillac benefit packages, and we will all be eating grewl while they eat steak.

Don’t you love it when a plan comes together…?

/

Seven Percent Solution on August 16, 2011 at 3:15 PM

If Obamacare isn’t repealed, little else matters. The country will never be the same.

repealObamacarePAC.com on August 16, 2011 at 3:15 PM

This is precisely why we need everyone to band together and defund, destroy and disassemble o-care as quickly as possible.

Mangy Scot on August 16, 2011 at 3:16 PM

In the interview, Morton says that “2014 is when our country changes substantially.” His explanation shows why the country needs to change its leadership substantially in 2012 to avoid the consequences of ObamaCare.

Along with a collapsing economy, destruction of our right of self defense, our free-speech rights,…

Chip on August 16, 2011 at 3:19 PM

Contessa Brewer wants to know if Glenn Morton has a degree in Obamacare.

BacaDog on August 16, 2011 at 3:19 PM

He’s obviously a RACIST!!! :-)

SoRight on August 16, 2011 at 3:21 PM

It will be cheaper to pay fines than to provide coverage.

Gosh. Imagine that. A company will actually do the fiscally prudent option for its shareholders.

Companies are people. Racist people.

BacaDog on August 16, 2011 at 3:22 PM

Racist!

Shay on August 16, 2011 at 3:25 PM

OMG, check out the cover of his book! Worth the price by itself!

Shay on August 16, 2011 at 3:28 PM

IF ObamaCare is still around in 2014, people will be screaming for it’s demise. They won’t be able to afford coverage, and neither will the government.

GarandFan on August 16, 2011 at 3:09 PM

I completely agree with you.

Read this from Friday’s news dump courtesy of the Treasury Dept:

link

ObamaCare will collapse under its own ineptitude and voter anger. Democrats will be running for the hills when the Death Star is fully operational in 3 years.

Chuck Schick on August 16, 2011 at 3:31 PM

It will be cheaper to pay fines than to provide coverage.

And the employees will still be uninsured.

The damage this legislation will do is literally incalculable. It’s that bad.

But then again, it was never designed to provide insurance. It was designed to destroy insurance as a path to single payer.

Missy on August 16, 2011 at 3:31 PM

I saw a report yesterday that said the federal government has already handed out more than $125 million to a few of the states to start building the bureaucratic infrastructure necessary to administer the state insurance exchanges required under Obamacare.

If the Supreme Court invalidates the individual mandate (as the 11th Circuit recently did), or even the entire Obamacare law, then all these exchanges are going to become superfluous. Why are we spending hundreds of millions of tax dollars on something that may well be ruled illegal next year? Is this just another one of the Obama administration’s phony “jobs” programs?

AZCoyote on August 16, 2011 at 3:33 PM

Tick…tick…tick…tick…tick…tick

Cicero43 on August 16, 2011 at 3:34 PM

Taxing the rich will pay for everything.

Bishop on August 16, 2011 at 3:12 PM

People also used to think that perpetual motion machines could actually work..

Chip on August 16, 2011 at 3:37 PM

And this does not even include the doctors fleeing the profession…

PatriotRider on August 16, 2011 at 3:38 PM

if i get any more hope and change, i’m afraid it may kill me

DrW on August 16, 2011 at 3:10 PM

If more hope and change we do get, kill you it will! *yoda voice*

Cadian on August 16, 2011 at 3:40 PM

those greedy corporate jet owners surely are flush with coinage and can pay for this…… right? RIGHT?/

ted c on August 16, 2011 at 3:45 PM

Yes, I’ll just echo that Mr. Morton is obviously a racist bigot. Mr. Morton, why do you hate your country, and old people, and young people, and black people?

j_galt on August 16, 2011 at 3:48 PM

IF ObamaCare is still around in 2014, people will be screaming for it’s demise.

GarandFan on August 16, 2011 at 3:09 PM

Unfortunately, the 52% who voted for Obama last time will be screaming for more taxpayer subsidies and show trials and public executions for insurance companies.

cool breeze on August 16, 2011 at 3:49 PM

Thank you Mr. Morton for helping to educate Americans on this vital issue!

I hope I hear you being interviewed frequently on radio and TV during the upcoming election season.

Your message needs to be understood before we vote again.

wren on August 16, 2011 at 5:06 PM

i am getting more scared every day about the mess that Obamacare is going to create. Those who voted for it in Congress should be tarred and feathered.

SC.Charlie on August 16, 2011 at 5:18 PM

This is why we need either President Perry or Bachmann to repeal this thing in 2013. Not sure I trust Romney to do so.

humdinger on August 16, 2011 at 5:22 PM

Racist….

jeffn21 on August 16, 2011 at 5:26 PM

i am getting more scared every day about the mess that Obamacare is going to create. Those who voted for it in Congress should be tarred and feathered.

SC.Charlie on August 16, 2011 at 5:18 PM

Part of me wants to see these idiots who voted for BO stuck in ObamaCare, but the problem is that we all have to pay for it.

Maybe we need to do away with a secret ballot. If you vote Conservative, your taxes go down and you get no Welfare other than Unemployment. If you vote Liberal, you get higher taxes, but get these govt programs. Then once your govt program runs out of money, you are stuck paying in and getting next to nothing out.

jeffn21 on August 16, 2011 at 5:29 PM

The Feds are working overtime to get the structures of ObammyCare in place RIGHT NOW so it will be all the harder to get rid of it.

Dhuka on August 16, 2011 at 5:32 PM

Missy on August 16, 2011 at 3:31 PM

Precisely. Don’t most people find it the least bit frightening that the government is going to fine you if you don’t participate in one of their programs.

celtnik on August 16, 2011 at 5:49 PM

Still won’t be as expensive as senior costs. The number one long term drain on national wealth is the elderly population – not the healthy, working poor and middle class.

ernesto on August 16, 2011 at 5:51 PM

ernesto on August 16, 2011 at 5:51 PM

Sorry, Ernesto, but the number one long term drain on our national wealth is our out-of-control government spending.

Once C’Care is abolished, conservatives can take up some of the private sector’s suggested solutions to apply a market-based fix a very real problem.

But it’s amazing that Obama in committee as a Senator, voted against every one of Sen. DeMint’s private-sector reforms to our health care industry. Because he cares.

Once O’Bama’s career is over, and DeMint’s is starting to flourish, the Senate might recognize the validity of some of DeMint’s suggestions, and rational legislators can work in conjunction with medical professionals to improve affordability and care.

rwenger43 on August 16, 2011 at 6:20 PM

Once C’Care is abolished

Sorry. S/b O’Care.

rwenger43 on August 16, 2011 at 6:21 PM

Still won’t be as expensive as senior costs. The number one long term drain on national wealth is the elderly population – not the healthy, working poor and middle class.

ernesto on August 16, 2011 at 5:51 PM

You’re the people responsible for Medicare too.

Chuck Schick on August 16, 2011 at 6:28 PM

Yeah, and that’s if you can find a doctor.

curved space on August 16, 2011 at 8:14 PM

Taxing the rich will pay for everything.

Bishop on August 16, 2011 at 3:12 PM

…for about 20 minutes…

landlines on August 16, 2011 at 8:25 PM

Still won’t be as expensive as senior costs. The number one long term drain on national wealth is the elderly population – not the healthy, working poor and middle class.

ernesto on August 16, 2011 at 5:51 PM

You could not be more WRONG!!!

Not only does Obamacare destroy access to doctors, medical devices, and medicine, it drives up costs for EVERYBODY!!!
It drastically drives UP the cost of senior care, because there are fewer choices and less access to appropriate (cost-saving, life-saving) treatments.

It destroys medical research, drives doctors out of business, and forces everyone to reveal their medical records to everyone: there is no more medical privacy.

Identity theft will accelerate because of the total lack of privacy.

Routine care for anyone will simply not be available, and more young, healthy (accident victims, etc.), and working poor will simply die waiting for a bureaucratic decision from some distant “death panel” composed of political appointees.

Read the bill: Obamacare costs well over $1 Trillion MORE every year than the current system. It was supposed to give health care access to an additional 35 million…but it can never actually do that…and even if it did, the cost would be an UNREASONABLE $28,571 per person per year!!! This is almost three times the current cost of health care for seniors.

landlines on August 16, 2011 at 8:39 PM

Why haven’t the Republicans in the House tasked the CBO with an honest appraisal of the cost of Obamacare, with a reasonable set of assumptions?

Are they afraid that an appraisal will push them to actually do something about Obamacare?

slickwillie2001 on August 16, 2011 at 8:45 PM

Still won’t be as expensive as senior costs. The number one long term drain on national wealth is the elderly population – not the healthy, working poor and middle class.

ernesto

None of which changes the fact that Obamacare is unaffordable.

xblade on August 16, 2011 at 9:48 PM

Yeah, and that’s if you can find a doctor.

curved space on August 16, 2011 at 8:14 PM

The “unexpected” consequences of O’Romney Care.

By placing more people into the system, the time it takes to see a GP in MA is now 55 days. So guess where people go for their healthcare – you got it – emergency room costs have INCREASED over 7%.

scituate_tgr on August 17, 2011 at 12:05 PM