An ObamaCare Canary is Dying
When Obamacare was passed in 2010, the lawmakers wanted to provide immediate relief to people with pre-existing conditions that did not have medical coverage and could not get it because of the prohibitive costs. Congress created a program and funded it with $5 Billion. This money was intended to last until Jan 2014 when the bulk of the coverage laws become effective.
The canary part of this that the money earmarked for this program is running out. In fact the administration has decided to close enrollments to new applicants. The administration wants to make sure the 100,000 that enrolled will have that money available to them through the end of the year.
Some would ask if there were other things that could be done other than halt new enrollments. The administration had already raised the enrollee cost from $4,000 to $6250. They had also cut some of the monies that it paid to providers of health care to these patients. Finally, they limited the number of pharmacies that could dispense the specialty drugs available to patients through the program. Although this did help, it was not enough.
This noble effort has helped 100,000 people in need. It is only for the rest of the year that new enrollees won’t be able to take advantage of the program because come Jan. 1 of 2014, they will be able to buy insurance through any carrier without regard to their pre-existing condition(s). It is estimated that about 40,000 people will be affected by the budget miscalculation based on an enrollment rate of 4,000 individuals a month.
The bigger issue is that this relatively small program had costs excessive to original estimates. Critics of Obamacare have been preaching for years that the costs were grossly under-estimated. This is at least in part some proof to support their allegations.
As mentioned previously, in order to sustain the program, monies were cut that were due to medical care providers. One thing that prognosticators have been saying is that medicare and Medicaid will do the same thing. This will effectively make it much more difficult for this patients to find doctors who will help them.
Another part of the plan that faces heavy criticism is that some healthy individuals will forego getting coverage until they really need it. They will buy insurance coverage after they find they have a condition. If this program is any indication and costs are going to be higher than anticipated, it stands to reason that there will be more people foregoing the coverage to save those insurance premium dollars.
Congress has budgeted 100 Billion dollars a year for ten years to help citizens pay for health insurance premiums. What happens when the cost overages in this part of the plan mirrors what has happened with the stop-gap plan we previously discussed? Does Congress cut eligibility? Does Congress instead cut subsidies for our premiums? Maybe they do like in the current program and cut provider payments?
House leaders have offered a solid proposal that is likely to gain bi-partisan support and protects those who most need insurance should implementation of the law be postponed because the exchanges aren’t ready. There has been no word from the White House in response to their letter.