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All Things (ObamaCare) Fall Apart
By Daniel Anderson on May 15, 2013
The hits just keep coming for President Obama’s beleaguered health care reform law. If you’ve had trouble keeping up with all of the bad news surrounding ObamaCare, I don’t blame you. For the sake of convenience, let’s take a look at some of this news and then consider the “big picture” for the floundering Affordable Care Act.
Health Insurance “Exchanges”
We’ll begin with the health insurance “exchanges,” which are the primary mechanism by which ObamaCare distributes massive government subsidies to private health insurance companies. These “exchanges” feature only government regulated and approved insurance plans, from which consumers are allowed to choose. When writing the law, Congressional Democrats and the White House left the dirty work of setting up these expensive, complicated “exchanges” to the states.
After a majority of states flatly refused to comply with this unfunded mandate, the Obama administration started scrambling to set up dozens of “exchanges” by itself. At the same time, the federal government is also burdened with the cost of conducting a massive public relations outreach campaign for ObamaCare, which remains unpopular with more than half of Americans. Compliant states are also struggling to implement their “exchanges,” with Idaho official Stephen Weeg acknowledging that the state bureaucracy will need to “beg, borrow, and steal” in order to get its “exchange” operational by the October 1st start date for enrollment.
The federal Department of Health and Human Services even broke ObamaCare’s own rules by approving Utah’s unique “dual exchange” system. It is clear that the Obama administration is becoming desperate to salvage its crumbling law by any means necessary. By the way, even if these “exchanges” are actually set up according to design, some of the nation’s largest insurance companies are still expressing reluctance to provide coverage plans for them in the first place. Perhaps private insurers do not find the idea of entering such government dominated “exchanges” an attractive prospect, after all?
Lawsuits continue to plague ObamaCare, as well. Earlier this month, a group of small business owners sued the federal government on the grounds that the text of the ObamaCare law does not authorize the government to issue subsidies to private insurance companies in those states with federally-run health insurance “exchanges.”
The Pacific Legal Foundation filed a separate lawsuit that uses Supreme Court Chief Justice John Roberts’ flimsy defense of ObamaCare’s individual mandate as a “tax” against the law. Revenue-raising bills, such as taxes, must originate in the House of Representatives in order to be constitutional, but the final version of ObamaCare began in the Senate. This is just a small sampling of the growing number of lawsuits brought against ObamaCare so far.
ObamaCare’s Medicaid expansion isn’t exactly going to plan, either. The law offers full funding for the first few years for those states that expand their Medicaid programs, and then promises 90% of the funding for future years. However, there is no guarantee behind that money, and truthfully, the federal government cannot afford to hold up its end of that bargain for very long.
Once that happens, state legislatures across the country will get stuck with the tab for Medicaid expansion, which will crowd out other state budgetary priorities such as education and infrastructure. As a result, many governors are refusing to take such a risky deal. Even Missouri, which has Democratic Governor Jay Nixon, is turning down Medicaid expansion due to resistance from the state legislature.
A recent study published in The New England Journal of Medicine casts doubt on the belief that Medicaid expansion is even a good idea. After Oregon expanded its Medicaid program in 2008, researchers found that, “…Medicaid coverage generated no significant improvements in measured physical health outcomes” in the first two years following the expansion. To be fair, the study did discern some positive secondary effects from the expansion, but the primary purpose of Medicaid is to improve health care outcomes for low-income Americans. If the program is not accomplishing that end, then something is seriously wrong with the program, and further expansion through ObamaCare isn’t the solution.
HHS Secretary Kathleen Sebelius is charged with leading the ObamaCare implementation effort, but it is clear that she is not up to the (potentially impossible) task. As POLITICO’s David Nather put it, “Obamacare fires are flaring up all over.” Unpopular policy and muddled messaging are hampering outreach efforts by the Obama administration, which leads Reuters’ David Morgan to question how many people will even sign up for insurance coverage under the law. After all, the law assumes that many uninsured but healthy Americans will enroll for coverage, and that these citizens will provide the necessary revenue to allow private insurance companies to comply with ObamaCare’s many costly mandates. If that assumption proves false, then the law is in serious danger of systemic failure.
The need to boost awareness for enrollment efforts is leading President Obama and Secretary Sebelius to take extreme measures. Speaking to Planned Parenthood, President Obama pleaded with the controversial organization to spread the word about enrollment on his behalf. Secretary Sebelius is personally begging health care industry leaders to donate funds for the implementation efforts. Of course, HHS denies that there is anything improper with such solicitation attempts. Fearing the impact that a complete ObamaCare meltdown would have on their industry, some private insurers are reluctantly stepping into the breach to help with the outreach efforts.
The "Big Picture"
So, what’s the “big picture?” Senator Max Baucus (D-MT), one of the law’s chief architects, recently admitted that ObamaCare is starting to resemble a “huge train wreck.” Senate Majority Leader Harry Reid (D-NV) fully agreed and asked for additional funding to implement the unpopular law. Remember, this is the same law that the Government Accountability Office recently stated would add $6.2 trillion to the long-term deficit, assuming that some unpopular cost-containing measures are phased out after 2019. According to Senator Reid, this law apparently needs even more money in order to function even somewhat adequately.
Why would Senators Baucus and Reid feel so pessimistic for ObamaCare? If you ask progressive Washington Post columnist Ezra Klein, he’ll tell you that the problem is (of course) Republicans. In summary, he argues that if only Republicans would keep shoveling money into the admittedly “unwieldy” law, then it wouldn’t have all of these problems! Mr. Klein, why would conservatives who oppose deficit spending and ObamaCare agree to increase the size of both? Was this really the Democratic plan all along? Why would you ever think that that would work?
By the way, Senators Baucus and Reid aren’t the only Democrats worried now that they’re seeing ObamaCare in action. Representative Jackie Speier (D-CA) recently acknowledged during a House subcommittee hearing that the Affordable Care Act “does not address [cost containment].” Senator Tom Harkin (D-IA) criticized the Obama administration for “raiding the Public Health and Prevention Fund” in order to advertise for ObamaCare. For his part, Senator Ben Cardin (D-MD) is worried that the law is causing insurance companies to hike premiums, and Senator Jeanne Shaheen (D-NH) fears that businesses still do not know how to comply with the complex law and that some will cut employees’ hours to reduce compliance costs. Failed South Carolina Democratic candidate, Elizabeth Colbert Busch, summed up all of these complains when she labeled the law “extremely problematic.”
In 2010, then-Speaker of the House Nancy Pelosi (D-CA) demanded that Congress pass ObamaCare despite intense opposition. She infamously argued that, “…We have to pass the bill so that you can find out what is in it.” More than three years later, we now know all too well what is in ObamaCare: disaster. Unfortunately, that is the “big picture” for ObamaCare.