…So maybe one of you smart people can explain this to me.
Since, theoretically, everyone is now going to be required to purchase health insurance, but there hasn’t been an increase in health insurance providers to cover the soon-to-be huge surge in customers, what’s to prevent the insurance providers from raising their rates exorbitantly?
I mean, isn’t that what supply and demand is all about? We’re about to have a ginormous demand for health insurance but a limited amount of suppliers sooooo…massive price raising?
Maybe I’m wrong. I don’t know.
Think about when states required all drivers to purchase car insurance before getting on the road? It’s obviously not as widespread (not everyone drives) but premiums did go up.
So you’re exactly right: Health insurance companies will make a lot more money thanks to this Act. Now the argument against this point would be to point out the fact that the Patient Protection and Affordable Care Act stipulates that insurers spend 80% of premiums on medical care.
The problem with that, as an argument, is that now that everyone will be required to have health insurance, chances are the demand for medical supplies will greatly increase, as will the demand for doctors. The demand for everything in the medical industry will be on the rise, therefore pushing up premiums and allowing for the insurer’s 20% to grow probably significantly.
More and more money is going to be tied up in the medical industry (just like when Medicare/Medicaid were introduced to the market) which will unfortunately effect the rest of the economy poorly and leave the middle-class more strapped for cash.
Scare tactics: classic Republican. Now for some truth!
Along with 80% of premiums being put toward medical care for the person, more generic drugs are going to be made so that drug companies have prices to compete with, and — oh, just read this. I don’t have the time to explain all of this to you.
Let’s just look at how peachy this will be:
1/1/2014
This is when a lot of the really big changes happen.
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No more “pre-existing conditions”. At all. People will be charged the same regardless of their medical history. ( Citation: Page 45, sec. 2704, Page 46, sec. 2701, and Page 57, sec. 1255 ) (But since insurance companies have to cover everyone no matter how sick they are, they’ll raise the premiums they charge everyone to cover the added medical treatment required by those with pre-existing conditions)
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If you can afford insurance but do not get it, you will be charged a fee. This is the “mandate” that people are talking about. Basically, it’s a trade-off for the “pre-existing conditions” bit, saying that since insurers now have to cover you regardless of what you have, you can’t just wait to buy insurance until you get sick. Otherwise no one would buy insurance until they needed it. You can opt not to get insurance, but you’ll have to pay the fee instead, unless of course you’re not buying insurance because you just can’t afford it. (Again, increased premiums to everyone so they can cover the medical expenses of those with pre-existing conditions or people who are not paying for insurance but simply pay the tax instead since the insurance companies are required by law to cover them anyway)
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Insurers now can’t do annual spending caps. Their customers can get as much health care in a given year as they need. ( Citation: Page 14, sec. 2711 ) (again-more medical treatment=higher premiums for everyone)
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Make it so more poor people can get Medicaid by making the low-income cut-off higher. (More people on Medicaid-higher taxes for people that actually work for a living)
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Small businesses get some tax credits for two years. ( Citation: Page 138, sec. 1421 ) (Yeah, not sure how that all works)
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Businesses with over 50 employees must offer health insurance to full-time employees, or pay a penalty. (And which do you think will be cheaper? They’ll pay the penalty and you’ll be on your own)
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Limits how high of an annual deductible insurers can charge customers.
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Cut some Medicare spending (Like Democrats ever cut spending)
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Place a $2500 limit on tax-free spending on FSAs (accounts for medical spending). Basically, people using these accounts now have to pay taxes on any money over $2500 they put into them. ( Citation: Page 801, sec. 9005 )
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Establish health insurance exchanges and rebates for the lower and middle-class, basically making it so they have an easier time getting affordable medical coverage. (which means we pay more taxes to cover these people)
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Congress and Congressional staff will only be offered the same insurance offered to people in the insurance exchanges, rather than Federal Insurance. Basically, we won’t be footing their health care bills any more than any other American citizen. ( Citation: Page 81, sec. 1312 ) (right…congress has already exempted themselves from this cluster…nice try, though)
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A new tax on pharmaceutical companies. (Loss in revenue passed on to consumers. That means you pay more)
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A new tax on the purchase of medical devices. (costs passed on to patients who need those devices)
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A new tax on insurance companies based on their market share. Basically, the more of the market they control, the more they’ll get taxed. (and the higher your premiums will be)
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The amount you can deduct from your taxes for medical expenses increases. (Don’t know much about that-I have someone who does my taxes)
(via illsevenyournine)
