Hidden provisions in the health law will create new costs for employers.
We’re about to enter a new age of chronic under-reimbursed care.
Large firms have a strong incentive to drop coverage under the new health law.
White Castle finds that the new law might cut its net income in half.
The Milliman consulting and actuarial firm discusses how an ineffective individual mandate — one that leads many people to defy the requirement that they buy insurance — combined with a mandate that insurers cover all comers without charging any additional premiums for those with preexisting conditions, would likely raise health insurance premiums dramatically.
In perhaps the most authoritative study to date on ObamaCare’s likely impact on insurance premiums, the Oliver Wyman consulting firm spent eight months developing a model to gauge the legislation’s effects, drawing on a database of actual insurance information for nearly 6 million people. The firm’s analysis of the Senate bill (which, in connection with the Reconciliation Act, became law) concludes that its weak individual mandate wouldn’t coax high participation among younger and healthier people; that its other mandates (requiring more expensive coverage and not allowing insurers to charge applicants based on the likely costs of their care) would encourage high participation among older and less-healthy people; that adverse selection would result; and that premiums would therefore rise dramatically. Within five years, the average family’s insurance premiums would be $3,341 higher with ObamaCare than without it, the average individual’s premiums would be $1,576 higher, and overall insurance costs would be 54 percent higher — above and beyond the impact of medical inflation.
Richard Epstein examines Supreme Court precedent in rate-making cases and concludes that, even apart from the question of whether the health-care overhaul is an unconstitutional extension of Congress’s power to regulate interstate commerce, it is unconstitutional under the takings and due process clauses of the Fifth Amendment. According to Epstein, the Supreme Court’s “basic constitutional requirement” in this realm is that “any firm in a regulated market must be allowed to recover a risk-adjusted competitive rate of return.” Because the Reid bill (which, in connection with the Reconciliation Act, became law) sharply limits health insurers’ ability to raise premiums or deny applicants, it “emphatically fails this test” — as there is a “near mathematical certainty” that it would drive insurers out of the individual and small-group markets.
Through a variety of restrictions, requirements, prohibitions, and taxes, ObamaCare would — as if by design — seriously hinder, if not altogether kill, HSA plans — despite the promise they have shown as a tool for lowering health-care costs
This page provides links to letters written to Health and Human Services Secretary Kathleen Sebelius from 12 of the 19 states that have opted out of Obamacare’s federal high-risk pools.