Now that Obamacares initial open enrollment period is over, with eight million having obtained insurance through Obamacare exchanges, and maybe three million each added to Medicaid or their parents health plans, Obamacares hard truths risk disappearing down the memory hole.
Despite President Obamas promise that If you like your plan you can keep it, about 6 million people have already been notified by insurance companies that their insurance is being canceled. That number will grow. Currently, about 19 million people have health coverage purchased in the individual market. These people will have to switch to Obamacare plans, which offer very poor access to care. Subscribers to Blue Shield plans in California have already sued the insurer for allegedly lying about which providers are available in-network.
As for small businesses, very few will be able to keep their health plans. Even small changes in deductibles and copayments or a switch of plans offered by the same carrier means losing grandfathered status under Obamacare. As a result, small businesses will have to comply with dozens of costly new mandates, such as paying for so-called preventive care through insurance bureaucracies instead of directly out of pocket. In August 2010, the U.S. Department of Health and Human Services estimated that two-thirds of small-business employeesand maybe up to 80 percentwill no longer be able to keep the plan they now have.
Even large employers will eventually lose their grandfathered status. A survey of employers by a leading benefits consultant suggests that at least 90 percent of employers expect to lose their grandfathered status.
If your employer has fewer than 50 full-time workers, she has no mandate to offer health benefits. Larger employers have a mandate to offer health benefits. However, they do not have to cover spouses or pay for dependents. Most importantly, they have an incentive to offer benefits that will be unaffordable to many workers. Dont count on the so-called employer mandate to force your employer to keep your benefits in place.
For political reasons, the employer mandate has been delayed. A large employer, for example, can offer a health plan so expensive that you cannot afford it (up to 9.5 percent of your annual wage in premiums, plus the full cost of coverage for your family). If you turn down this offer, you will not be entitled to subsidies if you buy coverage in an Obamacare exchange.
Because of mandates and regulation, coverage will be more expensive for everyone outside a small proportion of older, low-income adults who can get highly subsidized coverage in the exchanges. As well as extra layers of taxes, some of Obamacares benefits have hidden costs. Health insurers are raising premiums for everyone in order to charge people with pre-existing conditions less than the expected cost of their care. Some young people have seen a doubling or tripling of their premiums. Insurers are also trying to limit the higher costs of sicker enrollees by offering them plans with higher deductibles and narrow networks that cover very few of the doctors and hospitals in areas where people live.
Other costs will be seen outside the healthcare system. In order for employers to provide health insurance (or more generous insurance) to their employees, they will have to reduce what they pay in wages and in other benefits. The Congressional Budget Office estimates that 2.5 million full-time jobs will be lost in the long term because of Obamacare.
Many Americans are justifiably angry about the individual mandate, which forces most individuals to buy private insurance. However, the individual mandate was effectively deferred until at least 2016 because the Obama administrations Department of Health and Human Services allowed people to define for themselves if they suffer a hardship exemption.
Because this exemption was created in order to reduce the political liability of fining people before the November 2016 election, fewer healthy people and more sick people will continue to sign up for coverage. Premiums will continue to rise as a result.
Despite an apparently successful initial open enrollment, the many real costs of Obamacare continue to burden Americans.