Oct 15 2016

Obamacare’s Death Spiral Begins

Published by at 1:36 pm under All General Discussions,Fly By

While the news media shoot their Big Sleaze Guns in a clearly coordinated attempted to fix the POTUS election for Hillary (think there won’t be multiple opportunities for a massive round of law suites after this debacle???), the big news this year is the collapse of Obamacare and how millions of Americans ARE LOSING their un-affordable health insurance. While the news media runs the gutter trolling for trash on Trump, Americans are really hurting, and hurting in serious numbers:

A new report from Bloomberg provides an estimate for just how many Americans will be affected: “At least 1.4 million people in 32 states will lose the Obamacare plan they have now.”

The people impacted will still have access to health insurance, as well as government subsidies to help pay for their insurance, if they qualify. But in some parts of the country, Obamacare customers will have only one option for insurance next year, after insurers like Aetna and UnitedHealth abandon the marketplaces.

This impacts 32 states in terms of choice, but all states have had to shoulder the financial burden:

In 2008, the average employer-sponsored family plan cost a total of $12,680, with employees footing $3,354 of the bill, according to Kaiser data. By 2016, the cost of the average employer family plan was up to $18,142 for the year, with workers picking up $5,277 of the tab.

These increased costs for employers and employees alike may seem steep—up around 50% over the past eight years—but they could have risen far higher had the Affordable Care Act never passed.

The myth we would have the same or higher costs without Obamacare is idiotic.  It would defy logic to say extending care to 26 year old children from the parent’s plan, or to ban restrictions from preexisting conditions, or that everyone had to have the same overloaded plan would cost us zero dollars.

If that was the case, then we would not needed to force insurance companies to take on all these added expenses in the first place.

But note the 50% increase in cost over 8 years, because what you will see coming in 2017 is Obamacare becoming completely un-affordable.

Example 1, Illinois:

Blue Cross Blue Shield of Illinois, the most popular insurer on the state’s Obamacare exchange, is proposing increases ranging from 23 percent to 45 percent in premiums for its individual health-care plans, according to proposed 2017 premiums that were made public Monday. The insurer blamed the sought-after hikes mainly on changes in the costs of medical services.

That one year jump rivals the increases from the last 8 years!

Examples 2 – 5, Oklahoma, Tennessee, Minnesota, Colorado, Arizona:

Among the states with the biggest 2016 premium hikes for popular low-cost “silver” plans, according to USA Today: Oklahoma rates are set to climb a whopping 42%; Tennessee is expecting a jump of 39%; and Minnesota, Colorado and Arizona, which should all see increases in the neighborhood of 25%

And now we learn North Carolina insurance market under Obamacare is on the verge of total collapse:

More than 250,000 people in North Carolina are losing the health plans they bought under the Affordable Care Act because two of the three insurers are dropping out — a stark example of the disruption roiling marketplaces in many parts of the country.

This Hot Air post references another post outlining the enormous costs families in Minnesota are facing:

Minnesota House speaker Kurt Daudt told me about a local farming family of three that has to pay $2300 a month in premiums for 2016 for a policy with a $13,000 deductible. That’s $40,000 out of pocket before the first benefit outside of a standard wellness check (~$500 per person tops) gets covered. For some reason, they stuck with the insurance this year, but Minnesota’s rates will be going up 50-67% in 2017. On the low end, that’ll make their premiums $3450 a month, which escalates that threshold to over $54,000 with premiums and deductibles added together. That’s more than some hospitalizations would cost, so … why would they stay in the exchanges?

As noted in the post, you can buy a really nice house for those premiums.

Or, you cannot afford to buy a nice house BECAUSE of those premiums. So I am not surprised the housing market is being hit by the fact people cannot afford a new or higher mortgage? Not in the least, take California:

August was the sixth consecutive month in which there was a year-over-year decline, even though sales remained above a rate of 400,000 for the fifth straight month.

“We are seeing the market tempering, which is being driven by reduced affordability and not enough homes for sale on the market, particularly in the San Francisco Bay regions, where runaway home prices have constrained home sales,” CAR President Pat “Ziggy” Zicarelli said in a news release.

“Two of the region’s least affordable counties — Marin and Santa Clara — saw sales fall from a year ago, while Contra Costa and Sonoma counties experienced more modest slowdowns.”

With Obamacare costs spiraling out of control – but mandated by law to be purchased – the cancer that is Obamacare is killing our economy and our future:

We don’t have to look far for confirmation that Americans are generally poor savers. Every month the St. Louis Federal Reserve releases data on personal household savings rates. In July 2016, the personal savings rate was just 5.7%. Comparatively, personal savings rates in the U.S. 50 years ago were double where they are today, and nearly all developed countries have a higher personal savings rate than the United States. In other words, Americans are saving less of their income than they should be — the recommendation is to save between 10% and 15% of your annual income — and they’re being forced to do more with less in terms of investing.

Is it a coincidence that the size of government over the last 50 years has ballooned (along with out national debt) and there was also a drop in savings? I am going to wager the statistical linkage is quite high here.

The article (from the politically driven news media) implies this is a problem with spend-happy citizens.  But I argue this is was brought on by spend-happy government, which claims it knows how to spend our income better than we do.  And let me be clear, this is our income over a life time of work, plus our children’s life time of income, and our grandchildren’s life time of income (given the stunning size of the national debt). This is not going to be cleaned up in a year, but we do need to stop the bleeding now.

Obamacare is destroying Main Street’s finances.  The super rich will not be seriously impacted by this mess, but the vast majority of the voters will.  There are two paths out of this mess:

  1. Become slaves to the government and the super rich and live off government handouts (gleaned from taxes on our hard work), or
  2. Prune government back down to minimal intervention towards Main Street.

Obama did not lift all boats, he sunk them all.  And Hillary wants to do more of the same

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