Supreme Court and the Individual Mandate

Sleep2Die4 · Post by **Sleep2Die4** » Thu Jun 28, 2012 11:43 am

2012 Presidential Candidate Gary Johnson:

“Whether the Court chooses to call the individual mandate a tax or anything else, allowing it to stand is a truly disturbing decision. The idea that government can require an individual to buy something simply because that individual exists and breathes in America is an incredible blow to the bedrock principles of freedom and liberty. It must be repealed, and Congress needs to get about doing so today.

“There is one thing we know about health care. Government cannot create a system that will reduce costs while increasing access. Only competition and the price transparency that competition will bring can accomplish the imperatives of affordability and availability. Whether it is the President’s plan or the Republican prescription drug benefit, the idea that anyone in Washington can somehow manage one of the most essential and substantial parts of both our quality of life and the economy is, and always has been, fundamentally wrong.

“We can never know how many Americans are out of work today because of the uncertainty the monstrous health care law has caused. The Court has done nothing to remove that burden.

“Nothing about today’s decision changes the basic reality that it is impossible to eliminate deficit spending and remove the smothering consequences of federal debt without dramatically reducing the costs of Medicare and Medicaid. And neither the Democrats nor the Republicans have given the slightest hint of willingness to do so.”

There is no doubt in my mind that electing Republicans and Democrats is speeding up our country's descent into debt, poverty and despair.

ChicagoGranny · Post by **ChicagoGranny** » Thu Jun 28, 2012 11:45 am

PST · Post by **PST** » Thu Jun 28, 2012 11:46 am

Sloop wrote:
Kitatonic wrote:Thanks to the last two posts. I was shocked with the posts not acknowledging the obvious fact the we have a major pre-existing condition and could exceed the insurance care lifetime caps. Both of these issues were addressed In our favor in the Affordable Care Act, now upheld by the Robert's court.
To my knowledge there is nothing in the ACA that prevents insurance companies from demanding a much higher premium for "pre-existing conditions". I suspect your "victory" is nothing more than a red herring.

The relevant language is in section 1201 of the PPACA. The act not only prohibits denial of coverage or exclusion of coverage for pre-existing condition, but also premium discrimination based on pre-existing conditions. It imposes "community rating," so that premiums don't necessarily have to be the same in Nebraska as in New York City, but withing each geographic area, they must be uniform. The only factors that can be taken into account are age (within defined limits), family size, and smoking (which can justify up to a 50 percent higher premium).

This is really the essential, central point of the whole act, and I fault the administration almost as much as the press and some of the act's unscrupulous opponents for the poor job that has been done of communicating this. Today, the smartest way for private insurers to compete is to cherry pick the best risks. A company that can't find ways to avoid insuring high-cost customers can't match the premiums charged by companies that can. The PPACA closes that door, saying to insurers that they can compete on quality, efficiency, convenience, service, and every other variable, but not on risk selection. They have to take their customers as they come and charge them all the same. In return, everyone has to get insurance, but with subsidies on a sliding scale by income.

Sloop · Post by **Sloop** » Thu Jun 28, 2012 12:13 pm

PST wrote:The relevant language is in section 1201 of the PPACA. The act not only prohibits denial of coverage or exclusion of coverage for pre-existing condition, but also premium discrimination based on pre-existing conditions. It imposes "community rating," so that premiums don't necessarily have to be the same in Nebraska as in New York City, but withing each geographic area, they must be uniform. The only factors that can be taken into account are age (within defined limits), family size, and smoking (which can justify up to a 50 percent higher premium).

I struggle with trying to deem this a good thing. After all, we are talking about Insurance Companies -- not some Government Handout Company. How does the "pre-existing mandate" differ from the guy who wrecks his car and then walks into a State Farm Insurance office and demands coverage -- for the same price btw as the long time SF customer who has never filed a claim? Should not United Health Care be treated the same as State Farm in terms of how they can sell their wares? They are both PRIVATE enterprises.
Anyway, I am sure you have heard this argument before. The fact of the matter is that no insurance company can withstand the onslaught of millions of new customers, all with terrible ailments, and do this without imposing huge increases in premiums. Maybe everyone will be treated the same, but pay they will. ObamaCare was sold to the American public, in part, with the claim that insurance premiums would go down, not up.

Tip10 · Post by **Tip10** » Thu Jun 28, 2012 12:28 pm

One of the major fallacies of this plan is the statements that if you currently have private, employer sponsoired health insurance (which generally provides greater coverage than medicare and the plans offered up by the plan) you will be able to keep it. Factually, that's true BUT where it fails is the fact that YOU WILL ONLY BE ABLE TO KEEP IT IF IT CONTINUES TO BE OFFERED.

In reality what is almost assuredly going to occur is employer sponsored health care plans will cease to exist, especially employer sponsored plans for dependent coverage.

An industry analysis done in 2008 indicated that the premiums for employer sponsored coverage for an employee alone ran in the vicinity of $5000, and with dependent coverage added in the premiums jumped to about $13,000. Those premiums are generally split between employer and employee.

Effective by January 1, 2014, this plan will impose a $2000 per employee tax penalty on employers with over 50 employees who do not offer health insurance to their full-time workers.

So, it will soon simply become a question of economics -- is it economically more beneficial to an employer to pay the $2000 penalty PER employee to not provide a plan or to continue to incur much higher costs to provide a plan, or do they provide a plan ONLY to cover the employee (thereby avoiding the penalty) and drop the increased cost of dependent coverage.

Sorry folks, but if most companies look at paying $2000 per employee in tax penalties or $2500-$6500 (or more) per employee in premiums (assuming a 50/50 split) which do you think they will choose?

At present I enjoy a very good employer sponsored Health Insurance Plan -- one that I can assure you costs the company I work for well in excess of $2000 to provide for me and my dependents. That plan is likely at severe risk and I'll likely be forced into the Individual Mandate coverage -- it will simply be much cheaper for my company to pay the penalties or to drop dependent coverage all together and offer only coverage for me.

Sloop · Post by **Sloop** » Thu Jun 28, 2012 12:50 pm

Tip10 wrote:One of the major fallacies of this plan is the statements that if you currently have private, employer sponsoired health insurance (which generally provides greater coverage than medicare and the plans offered up by the plan) you will be able to keep it. Factually, that's true BUT where it fails is the fact that YOU WILL ONLY BE ABLE TO KEEP IT IF IT CONTINUES TO BE OFFERED.

In reality what is almost assuredly going to occur is employer sponsored health care plans will cease to exist, especially employer sponsored plans for dependent coverage.

An industry analysis done in 2008 indicated that the premiums for employer sponsored coverage for an employee alone ran in the vicinity of $5000, and with dependent coverage added in the premiums jumped to about $13,000. Those premiums are generally split between employer and employee.

Effective by January 1, 2014, this plan will impose a $2000 per employee tax penalty on employers with over 50 employees who do not offer health insurance to their full-time workers.

So, it will soon simply become a question of economics -- is it economically more beneficial to an employer to pay the $2000 penalty PER employee to not provide a plan or to continue to incur much higher costs to provide a plan, or do they provide a plan ONLY to cover the employee (thereby avoiding the penalty) and drop the increased cost of dependent coverage.

Sorry folks, but if most companies look at paying $2000 per employee in tax penalties or $2500-$6500 (or more) per employee in premiums (assuming a 50/50 split) which do you think they will choose?

At present I enjoy a very good employer sponsored Health Insurance Plan -- one that I can assure you costs the company I work for well in excess of $2000 to provide for me and my dependents. That plan is likely at severe risk and I'll likely be forced into the Individual Mandate coverage -- it will simply be much cheaper for my company to pay the penalties or to drop dependent coverage all together and offer only coverage for me.

EXACTLY RIGHT -- what you just unveiled is the dirty little secret that you never hear mentioned in the nightly news.

DreamStalker · Post by **DreamStalker** » Thu Jun 28, 2012 12:56 pm

The dirty little secret is that most everyone is totally blind/ignorant, or in denial of the big gorilla on the planet. The global financial system is going to collapse before 2014 and all this senseless political bickering will be moot by then.

Kerr · Post by **Kerr** » Thu Jun 28, 2012 12:57 pm

Where do I sign up for the Revolution?

PST · Post by **PST** » Thu Jun 28, 2012 1:10 pm

Tip10 wrote:One of the major fallacies of this plan is the statements that if you currently have private, employer sponsoired health insurance (which generally provides greater coverage than medicare and the plans offered up by the plan) you will be able to keep it. Factually, that's true BUT where it fails is the fact that YOU WILL ONLY BE ABLE TO KEEP IT IF IT CONTINUES TO BE OFFERED.

In reality what is almost assuredly going to occur is employer sponsored health care plans will cease to exist, especially employer sponsored plans for dependent coverage.

An industry analysis done in 2008 indicated that the premiums for employer sponsored coverage for an employee alone ran in the vicinity of $5000, and with dependent coverage added in the premiums jumped to about $13,000. Those premiums are generally split between employer and employee.

Effective by January 1, 2014, this plan will impose a $2000 per employee tax penalty on employers with over 50 employees who do not offer health insurance to their full-time workers.

So, it will soon simply become a question of economics -- is it economically more beneficial to an employer to pay the $2000 penalty PER employee to not provide a plan or to continue to incur much higher costs to provide a plan, or do they provide a plan ONLY to cover the employee (thereby avoiding the penalty) and drop the increased cost of dependent coverage.

Sorry folks, but if most companies look at paying $2000 per employee in tax penalties or $2500-$6500 (or more) per employee in premiums (assuming a 50/50 split) which do you think they will choose?

I do not understand the logic of this argument. Today, an employer can drop health insurance coverage with no penalty at all if it wants to, yet many still offer coverage. After 2014, there will be a substantial penalty. You say that since the penalty is less than the employer's share of the cost of coverage, employers will do the math and drop coverage. If they wanted to do that, why not do it today when there is no penalty? However much a company might be able to save in the future by not offering coverage, it could save $2000 more per employee by getting rid of insurance now. It doesn't make sense to me that employers will start dropping coverage after a penalty is enacted just because the penalty isn't bigger.

In addition, I believe that you are factually wrong to say that private, employer-sponsored health insurance generally provides greater coverage than the plans offered up under the PPACA. Even though there are some terrible employer-sponsored plans out there, I agree that most are good -- clearly better than Medicaid and more complete than Medicare. However, they are not better than the insurance plans to be offered in the exchanges under the PPACA. The benefit levels for those plans are defined and regulated in the act. One of the things I like best about the act is that the exchanges will define several standard benefit levels, so you can compare apples to apples when shopping for an insurance company. For example, a "silver" level plan will have to have benefits that actuaries say will on average cover 70 percent of expected medical costs, leaving 30 percent to co-pays and deductibles.

lazer · Post by **lazer** » Thu Jun 28, 2012 1:28 pm

PST wrote:..........
I do not understand the logic of this argument. Today, an employer can drop health insurance coverage with no penalty at all if it wants to, yet many still offer coverage. After 2014, there will be a substantial penalty. You say that since the penalty is less than the employer's share of the cost of coverage, employers will do the math and drop coverage. If they wanted to do that, why not do it today when there is no penalty? However much a company might be able to save in the future by not offering coverage, it could save $2000 more per employee by getting rid of insurance now. It doesn't make sense to me that employers will start dropping coverage after a penalty is enacted just because the penalty isn't bigger.

I think the argument is based around the understanding that employer health insurance coverage will be increased in regards to when OsamaCare goes into place thus they will then do the math and likely not want to pay the "assumed" higher premiums.

chunkyfrog · Post by **chunkyfrog** » Thu Jun 28, 2012 1:29 pm

Availability (and quality) of employer-provided health insurance is a major factor in recruitment and retention.
I do not see that changing. But but no healthcare at all for working folks is wrong.
I went back to school for 3 years to get a REAL job -(with health insurance.)
It has probably extended my life expectancy quite a few years.
It would be nice to see all working people getting at least as good healthcare as prison inmates.
It's only fair.

mikewithe · Post by **mikewithe** » Thu Jun 28, 2012 1:33 pm

Another thing that people continually assume is that costs will remain the same. This is entirely FALSE. As more and more people become insured and pay into the system, the risk pool widens thus DRIVING DOWN the cost of premiums for employers and the insured alike. The only things keeping the costs of insurance so high are the small size of risk pools and the current high cost of medical procedures. As these go down so, too, will insurance cost.

squid13 · Post by **squid13** » Thu Jun 28, 2012 1:36 pm

mikewithe wrote:As these go down so, too, will insurance cost.

You hope?

mikewithe · Post by **mikewithe** » Thu Jun 28, 2012 1:48 pm

lazer wrote:... OsamaCare

Really? Most people here know that I am a disabled vet but beyond that I don't normally discuss my service. In this case I'll make an exception. As a former Navy SEAL I take great offense to this statement. To compare our nation's leader to one of our nation's greatest enemies is despicable at best. If you want to start flinging insults go somewhere else. It achieves nothing toward stimulating debate. And serves to only stir animosity and resentment.

squid13 wrote:You hope?

Yes, I do hope. But it is a simple principle of economics.

squid13 · Post by **squid13** » Thu Jun 28, 2012 2:03 pm

When this thing is fully implemented there going to look at cost versus life expectancy and decide if it's worth expending the money on someone that's old say 75 or older. I fall into that category and I know everyone will say I'm nut's but there will be a so called panel to review who gets treated at that age and who doesn't. It will save a lot of money just to tell you to go home and take a pill and prepare to meet your maker. I can here them now saying your crazy, well we'll see.

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