Are Republicans sabotaging ObamaCare by frightening younger consumers?

posted at 9:21 am on November 20, 2013 by Ed Morrissey

That’s what Dana Milbank argues in his column today.  In his estimation, the GOP wants younger people to bail out of the ObamaCare system to encourage a “death spiral” for insurers by jacking up premiums and forcing the ACA to collapse under its own weight.  But Milbank has a serious chicken-egg misperception at the heart of his argument:

The Republicans’ scary-movie strategy has some logic to it: If they can frighten young and healthy people from joining the health-care exchanges, the exchanges will become expensive and unmanageable. This is sabotage, plain and simple — much like the refusal by red-state governors to participate in setting up the exchanges in the first place. But those sabotaging the new law should be careful what they wish for: Instead of killing the law, they are likely to make it more expensive to taxpayers. Their efforts could have the effect of turning Obamacare, which relies on private insurance and the free market, into just the sort of big-government entitlement Republicans were worried about in the first place.

If they succeed in scaring people away, the ones who join exchanges are likely to be older and sicker, making the insurance pool costlier to insurers. As Larry Levitt, a senior vice president of the Kaiser Family Foundation, explained to me, if costs are more than 3 percent higher than anticipated in the first few years of Obamacare, the federal government will have to pick up at least half of the additional expense.

If the health-care exchanges continued to attract only the elderly and the sick in future years, premiums would rise and the only people likely to remain in the program will be those who qualify for the federal subsidies, which would increase sharply because individual contributions are limited to a percentage of the recipient’s income.

“The more successful opponents are at discouraging young and healthy people from enrolling, the bigger share of the cost the federal government will end up covering,” Levitt said. “The implication of encouraging young and healthy people to sit on the sidelines is that costs are shifted to the federal government.”

This is nonsense on stilts, because it assumes that prices remained stable for these consumers in the first place.  In fact, prices have already skyrocketed, and for younger consumers in particular. HHS tried to claim that rates went up “less than expected,” but did so only by comparing the new rates released in September to projections for 2016, not 2014.  Avik Roy at Forbes and the Manhattan Institute showed that rates actually went up from 52% to 99% over the previous year, and quadrupled in some states. That’s before the first person signed up for these plans, healthy and young or sick and old.

Furthermore, the plans themselves changed in a way that didn’t fit the needs of those younger consumers.  Those younger consumers, who are on average a lot healthier and less affluent, chose plans that made some rational sense for their economic and health situations — coverage that focused on hospitalization and covered only those issues that they had reason to predict might concern them.  Now, ObamaCare forces them into comprehensive plans that make little sense for their potential use of health-care services.

Thanks to the costs of the mandates, insurance companies have had to raise deductibles just to keep premiums within range of these younger, healthier consumers, too.  Instead of a cheap, affordable plan that allowed young Americans to pay retail costs for occasional clinic visits but gave them solid coverage for rare catastrophic events, they now have to spend thousands of dollars a year for coverage that doesn’t kick in at all until after they spend an additional $4,000 out of pocket first.

And this is the calculation that anyone can make. If you have to spend $4,000 on insurance and then another $4,000 on deductibles before seeing the first benefit from the insurance plan, why buy it at all? Why not just pay retail on clinic visits? Most young people will see a doctor once or twice a year, which might cost them $500 or so rather than the $8,000 they’re facing in this newly mandated apparatus.  (Even if they do get subsidies for the premiums, they don’t get subsidies on the higher deductibles they now face.) Thanks to the ACA, they can buy insurance later if they do get really sick, and in the meantime will only have to pay a fine of around $500 bucks or so to avoid the mandate.

That’s not a “scary movie” snow job.  That’s a rational calculation of risk and cost. Milbank dances all around this point, but he never once provides a rational reason for younger, healthier people to pay into this system by the thousands of dollars when most of them won’t get a single dollar in benefits from it.


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Comment pages: 1 2

Who threw Grandma off the cliff?

Ben Hur on November 20, 2013 at 9:23 AM

How about we just throw bama from the train?

dentarthurdent on November 20, 2013 at 11:54 AM

Bmore

Schadenfreude on November 20, 2013 at 12:05 PM

Ah yes, the left’s indignation of people being told the truth.

sadatoni on November 20, 2013 at 12:08 PM

It is their duty to do so.

Youth, this. It is your duty as a free American
.

I will not comply because I am a free citizen of the United States, not a subject of its government. I consider non-compliance with this monstrosity and the tens of thousands of pages of regulations that are to be enforced by an unelected bureaucracy, and that have left a gigantic carbon footprint on our environment and the United States Constitution, a duty.

Non-compliance is my executive order, and that order reads in part that I do not recognize any government’s claim on my action or inaction in the marketplace, nor upon any personal information I am unwilling to divulge.

Schadenfreude on November 20, 2013 at 12:10 PM

This is the duty of every still free American.

I will not comply because I am a free citizen of the United States, not a subject of its government. I consider non-compliance with this monstrosity and the tens of thousands of pages of regulations that are to be enforced by an unelected bureaucracy, and that have left a gigantic carbon footprint on our environment and the United States Constitution, a duty.

Non-compliance is my executive order, and that order reads in part that I do not recognize any government’s claim on my action or inaction in the marketplace, nor upon any personal information I am unwilling to divulge.

Schadenfreude on November 20, 2013 at 12:12 PM

Dang, sorry for the double. Meant to post on other thread.

Schadenfreude on November 20, 2013 at 12:12 PM

No the skulls full of mush have finally been hit over the head with a cluebat.

neyney on November 20, 2013 at 12:24 PM

That’s what Dana Milbank argues

‘Nuff said.

Bitter Clinger on November 20, 2013 at 12:30 PM

For nimrods like Dana Milbank, ‘faith’ in the progressive agenda is all that is needed to revoke the laws of economics and human nature.

It also leads to little more than projection – the defense mechanism that takes their own unacceptable qualities or feelings and ascribes them to others. Progressive fascists do not hesitate to use fearmongering or demagoguing to push their agenda – so to them, it only makes sense (and justifies their own actions) for their opponents to do the same.

Athos on November 20, 2013 at 12:32 PM

Republicans are just telling the truth and providing necessary warnings to the otherwise unprepared or those otherwise mislead by the Obama administration. Sometimes the truth hurts.

HoosierStateofMind on November 20, 2013 at 12:35 PM

Next

Schadenfreude on November 20, 2013 at 12:52 PM

Republicans are just telling the truth and providing necessary warnings to the otherwise unprepared or those otherwise mislead by the Obama administration. Sometimes the truth hurts.

HoosierStateofMind on November 20, 2013 at 12:35 PM

Friend of mine calls it “committing truth in public.” This will always draw the ire of the professional liars and propagandists.

rockmom on November 20, 2013 at 12:55 PM

Next

Schadenfreude on November 20, 2013 at 12:52 PM

Add some dark glasses and a white cane and you can keep your vision plan too.

hawkeye54 on November 20, 2013 at 1:01 PM

Dana Milbank is just trying to come up with some way to blame the Republicans for something the Democrats did.

Why, it’s almost like he’s not really a neutral observer….

There Goes the Neighborhood on November 20, 2013 at 1:08 PM

“but he never once provides a rational reason for younger, healthier people to pay into this system by the thousands of dollars when most of them won’t get a single dollar in benefits from it.”

because civil duty or something. it’s our job to get fleeced. because Medicare and Social Security wasn’t enough .

NoVAHockey on November 20, 2013 at 1:08 PM

They should be afraid of this rancid pile of communist goat dung. Good for the Republicans if they are frightening the young people.

rplat on November 20, 2013 at 1:32 PM

If the insurance pool is made costlier for insurers, they’ll just call dear leader for more bailout dough. The young should be afraid, very afraid. They won’t be young forever or healthy.

Kissmygrits on November 20, 2013 at 1:34 PM

I think you are missing the point Ed.
I believe more things like this will come out, because the media is gonna rally around Obama and help push his new defense, of “It’s the Republicans fault this thing ain’t working”.

This is all just pushing the new meme to give Obama and the liberal agenda cover, and blame failures on something other than the Democrats and big government.

Look at how they blame capitalism after Government gets involved in the market and skews the economy.
Ask them, it is never their fault or their programs, it is always “capitalism is evil, and this new economic collapse is proof of that.”

MityMaxx on November 20, 2013 at 1:36 PM

I smell desperation

Conservative4ev on November 20, 2013 at 1:42 PM

Why should kids do anything other than pay the fine? If they have a catastrophic event then get the insurance. Ditto for anyone actually. It’s the law of unintended consequences and you don’t have to be a Republican to figure that out provided you have a brain.

COgirl on November 20, 2013 at 1:55 PM

A bit of trivia: the actress in the cover image for this thread is Kathleen Hughes, a friend of mine here in Hollywood. A lovely lady. That was a PR shot for “It Came from Outer Space.”

rrpjr on November 20, 2013 at 2:20 PM

In progressive-world pointing out the truth, using facts, and the reality of the situation is scaring them. I know that the truth, reality, and facts of the cACA Obama HellCare scares the living crap out of me.

jukin3 on November 20, 2013 at 2:20 PM

Yeah, young people do what Republican say all the time. College girls are particularly powerless to resist the charisma of Mitch McConnell and Orrin Hatch.

forest on November 20, 2013 at 2:44 PM

If the health-care exchanges continued to attract only the elderly and the sick in future years, premiums would rise and the only people likely to remain in the program will be those who qualify for the federal subsidies, which would increase sharply because individual contributions are limited to a percentage of the recipient’s income.

What the hell kind of idiot designs a scheme so complex and unstable that if any one demographic deviates from the desired behavior, the whole thing collapses?

Wait, don’t answer that…

RINO in Name Only on November 20, 2013 at 2:50 PM

Democrat’s Dictionary:

Sabotage (must be said ala William Shatner) = telling the truth.

LASue on November 20, 2013 at 3:02 PM

Which is worse for the Dem’s, that the young and healthy find out;

The Repub’s told you the truth about how Obamacare screws you hard and don’t fall for it.

vs.

The Dem’s lied their @sses of to get you to fall for it and it screws you financially now and for years to come.

I think that the GOP just might have accidentally found the magic potion for getting at least some of the youth vote. Thanks Obamacare!

D-fusit on November 20, 2013 at 3:50 PM

Pointing out the obvious basic human nature result = sabotage

krome on November 20, 2013 at 4:09 PM

Who’s up for another socialist bribe…

“Giving All Americans a Basic Income Would End Poverty”

http://www.slate.com/blogs/business_insider/2013/11/17/american_basic_income_an_end_to_poverty.html

Because if it works in Switzerland…why not here?

http://www.article-3.com/how-switzerlands-basic-income-proposal-could-both-help-and-hurt-the-united-states-913007

Bread & Circuses…It’s what’s for Breakfast

workingclass artist on November 20, 2013 at 10:33 AM

It hasn’t worked in Switzerland yet.

If the point of theory is to model reality, how the hell does it work in theory of it doesn’t work in practice? It doesn’t, folks.

beselfish on November 20, 2013 at 11:37 AM

Something “works in theory” if it is a plausible explanation of the phenomena known to date; if it fails by making predictions that do not match future phenomena when they occur, then “it doesn’t work in practice”.

Of course, no socialist* theory actually works in theory either, since most of them ignore all known information about human behavior; what the socialists really mean is “it works if everything happens exactly the way I assume, and everybody does what I tell them to do.”
Even so, you have to consider: what do they mean when they say “it works” in the first place?

*not picking on socialists here (much), because this applies to just about every sociological / political philosophy in existence, once actual politicians get hold of it.

AesopFan on November 20, 2013 at 5:50 PM

I note that the coward doesn’t allow comments on his little article.

What a load of garbage.

So if the democrats push something we don’t like… we’re responsible for the failure of that system simply for saying we don’t like it?

Does the man even for a moment realize how self defeating that notion is if applied to other things? We could blame the democrats for a dozen things that we liked but failed because the democrats resisted or argued against it.

The level of just outright mind numbing stupidity from the left on these issues is beyond painful.

Karmashock on November 21, 2013 at 12:38 AM

I have probably advised a thousand young people if they are healthy, don’t sign up. Pay the penalty of 95 dollars. If they purchase this BS it will cost them around $2500.00 for the year. Any Idiot (including the Idiots who voted for this Idiot) can do the math.

tmgrant on November 21, 2013 at 7:12 AM

Republicans and the rest of U.S. that are sane, are not trying to frighten youngsters we are informing them of the truth and that is what is frightening them.

MSGTAS on November 22, 2013 at 12:33 PM

Comment pages: 1 2