The ObamaCare law was cynically designed to create freebies to appease the masses while the government systematically takes over medical care altogether. No other outcome is possible here, on the course ObamaCare has set for us. By piling profit-destroying restrictions on health insurance companies like no other industry has ever endured, insurance companies will eventually go out of business.
By Michael J. Hurd, Ph.D.
Like peeling back the layers of a rotted onion, the gradual impact of ObamaCare becomes more revealing by the day. The latest? Insurance companies who spend more than 20 percent on administrative costs will be forced, under the new law, to send rebates to policyholders. Imagine this law applied to any other business. Imagine your favorite grocery store chain being forced to pay out money to customers if they spent more on grocery carts, lighting, air conditioning and rent than the federal government deemed acceptable. Or, imagine Apple computer being forced to give away billions of dollars in free products if they spent more on advertising than the federal government deemed acceptable. In America, even in the socialist era of Obama, there would be outrage across the land if such things were even proposed. Yet health care is different. Insurance companies are thought to be immune from such restrictions. And who could argue with rebates, after all? Why, Obama might sail to a landslide reelection victory at the rate he’s going with such a giveaway.
Does anyone with even half a brain think there will be no negative consequences of this law? Sure, this year insurance companies will reportedly give policyholders billions of dollars back in rebates. But insurance companies still are insurance companies. You can tax them, penalize them, regulate or fine them all you want. It’s going to come back to bite you in the form of higher premiums. It’s just like gasoline taxes. Everyone loves to tax oil companies, because everyone seems to agree that oil companies are by nature evil for making a profit at what they do. So what happens? The price of oil and gas goes up and up and up, because oil companies pass the penalties on to the consumer. If you thought health insurance and health care were expensive before ObamaCare rebates, just wait until the freebies start coming.
It’s unclear who will actually get these rebates. Most people do not purchase their own insurance. Most people have health insurance coverage through their employers. Will the employers get the rebates? What benefit will this directly be to employees who have the policies? It’s unlikely that there will be direct benefit to employees. For example, it’s not likely that people’s employers will give their employees raises due to this rebate, not in this high unemployment/virtually no-growth economy. Still, Obama will be perceived as having done something humanitarian and garner enough credit to at least get a 51-55 percent reelection. And by the time the health insurance industry collapses and everyone is forced to go on Medicaid, Obama will be done with his two terms in office and some poor future Mitt Romney sap will be left to pick up the pieces (and take the blame).
Almost nobody questions that squeezing and punishing hated health insurance companies is a good thing. But keep in mind that these health insurance companies, while profit-making, are so heavily regulated at both the state and federal level that they’re not functioning as a free market in medical insurance and health care would. We don’t have the Apple, Microsoft or Walmart equivalent of health insurance or medical care in America. That’s precisely the problem. If we did, there would be a deregulated array of thousands of different health care options and competition that would drive a lot of health care expenses down. Of course, it’s hard for the concept of a free market to compete with freebies.
The ObamaCare law was cynically designed to create freebies to appease the masses while the government systematically takes over medical care altogether. No other outcome is possible here, on the course ObamaCare has set for us. By piling profit-destroying restrictions on health insurance companies like no other industry has ever endured, insurance companies will eventually go out of business. Nobody (including large employers) will be able to afford health insurance policies after ObamaCare is through with these companies. That leaves just one option for nonseniors: Medicaid. In the area where I live, I’m already hearing of people who are self-employed making the switch to government coverage.
Careful what you wish for, America. In poll after poll, even pre-Obama, majorities favored greater restrictions on health insurance companies. What the fools in the majority overlook is the fact that they’re destroying the only means they have of getting covered, outside of government. It’s fine to say insurance companies are evil, but if you destroy them, what are you left with? Single-payer insurance.
Like all things Obama, ObamaCare took a dysfunctional situation and turned it into a disaster. What should have been a course reversal away form socialism and towards freedom in medicine turned into a law consciously designed to destroy freedom in medicine altogether. The all-but-explicit purpose of ObamaCare is to force everyone to have government insurance. Once everyone is covered by Medicare or Medicaid, then Big Government politicians can get on to the most important business of controlling everyone’s lives, health and destinies. It’s a sad turn for a nation that started out so noble in its embrace of sovereignty for the individual.
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