This week marks the first anniversary of Obamacare, and already some of the less egregious aspects of the law have taken effect: minimum loss ratio regulations, the small-business health insurance tax credit, high-risk pools, and coverage mandates on insurance companies. However, the worst parts of Obamacare won’t kick in until 2014. You can learn more about in our recent Heritage in Focus podcast with Heritage expert Bob Moffit. Click here to listen.
So what has health reform accomplished over the past year?
First off, as a result of new laws imposed, insurers cannot limit lifetime benefits, nor can group plans limit yearly benefits. On top of that, it is now permissible that people can stay on their parents’ insurance plans until age 26. These policies have resulted in premium increases: BlueShield of Oregon has attributed 3.4 percentage points of its 17.1 percent rate increase to Obamacare, while Celtic Insurance Company in Wisconsin and North Carolina has attributed 9 percentage points of its 18 percent rate increase to Obamacare.
Secondly, Obamacare has imposed new child coverage laws, requiring that insurers offer coverage without regard for preexisting conditions. What has resulted is that at least 34 states have exited the market and 20 states now have no insurers offering child-only plans.
Thirdly, many companies that offer mini-med plans are no longer able to do so. This is because, as mentioned above, these plans limit benefits. This has resulted in over 1,000 Obamacare waivers, exempting businesses from aspects of the law. Perhaps the most notable case was McDonald’s, which threatened to drop scores of its employees from health coverage until it was later granted a waiver.
Additionally, Obamacare was supposed to create high-risk pools for individuals who can’t easily obtain health coverage. Seventy percent of states had high-risk pools before the law was enacted, but the new health reform offered generous subsidies for people to buy coverage in new high-risk pools. As a result, the Office of the Actuary at the Centers for Medicare and Medicaid Services estimated that 375,000 people would be enrolled in these high-risk pools by December 2010. Well, as of February, 2011, only 12,500 people have enrolled, or about 3 percent of its estimate.
And these are but a few of the many ill-effects the new law has imposed over the past year. The health reform law was designed on impractical assumptions, idealistic models, and rosy scenarios that will never come to fruition. It will only make things worse over the coming years, unless we repeal it.
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