Let’s stipulate up front that Obamacare was a poorly written, unsustainable program.
Unfortunately, Republicans’ eagerness to undo any part of it, including the individual mandate, without looking at the whole picture, could spell electoral trouble for them this November.
It’s not that the mandate is a noble idea, but by eliminating it, while keeping the rest of Obamacare in place, the Republicans have placed a fat bullseye on their backs.
President Obama deserves credit for recognizing that it was simply untenable for the world's most powerful nation to have 44 million residents uninsured, and just a slip and fall away from bankruptcy. Fashioning a remedy was essential, but the plan Obama concocted was a disaster. It failed because Obamacare was based on politics rather than reality.
Right out of the gate, Obama bowed to his trial lawyer benefactors by declaring tort reform off the table. Meanwhile, defensive medicine is one of the biggest drivers of healthcare costs, and one of the items that separates us from European nations with lower healthcare costs.
Nor did the plan deal with the enormous costs associated with the last six months of life. Ultimately, Obamacare was not a measure controlling healthcare costs, but rather, a vehicle by which to shift responsibility as to who pays the bill.
At the core of Obama's economic policies was the redistribution of income. And, in the case of Obamacare, it was going to be the middle class who took it on the chin.
Most of the newly insured were covered by a massive expansion of Medicaid, which hit taxpayers with a $68 billion increase in 2015 alone.* Then there were those who were able to get insurance for the first time through the exchanges.
A good chunk of that massive cost was going to be borne by those middle-class Americans previously insured. Already sky high premiums increased an average of 60 percent from 2013 to 2017, while deductibles were doubling.
Leftist pundits gush over the number of the newly insured under the ACA, but totally ignore the pain that was inflicted upon tens of millions of Americans who were seeing their costs go through the roof to subsidize these newbies, who often had expensive pre-existing conditions.
The premium increases projected in October 2016 (as high as 116 percent in one state) was a remarkably understated factor in the electorate’s rejection of the Democrats that November.
Americans remembered President Obama's false promise of an average premium reduction of $2,500, and this bit of bad news was the last straw for many previously giving Obama the benefit of the doubt.
By the 2016 election, Democrats owned Obamacare, but the following year, the GOP, now in control, took a political hit for not implementing a better plan. Yet, that setback would have been temporary. Ultimately, future increases would still have been pinned to the Democrats who wrote the law in 2009.
But President Trump felt compelled to get a "win" on Obamacare. He couldn’t revoke the whole of Obamacare, so he foolishly decided to revoke just a part of it — that being the individual mandate — in the tax reform bill.
But rescinding that mandate, without also revoking the remainder of Obamacare, was obviously going to increase premiums on those presently insured. The individual mandate required those refusing to join the exchange to at least contribute to the pool.
Even though it was a small amount per individual, collectively, it was a substantial sum contributed by the 6.5 million willing to pay the fine.**
That money is now gone, yet the bills for all of people in the system still have to be paid.
So, who will make up the difference? Answer: The average middle-class person who will see a substantial increase in his or her premium this October. Now, much of that coming increase will be a natural continuation of the Obamacare formula, which simply never added up.
But at least a portion will be directly attributable to Trump’s elimination of the mandate. Insurers are already warning that New York premiums will increase at least 12 percent, *** and are blaming it on dropping the mandate.
So, what was once a black eye for the Democrats may be turned against Republicans this year. And for what? Obamacare is, for the most part, still in place. The billions needed to fund it, must still be raised.
President Trump may enjoy the cheers he is getting at his rallies when he touts his mandate reversal, but beware — a backlash is coming when those cheering today find out they will be paying higher premiums tomorrow.
There’s still time to fix this. Republicans should get on this prior to the midterms or at least part of the goodwill generated from the tax cut economic boom will be lost.
*Forbes. July 28, 2016
**CNN Money Oct 25, 2016
***New York State Department of Financial Services
Steve Levy, former New York state assemblyman, Suffolk County executive, and candidate for governor, is now a distinguished political pundit. Levy's commentary has been published in such media outlets as Washington Times, Washington Examiner, New York Post, Albany Times, Long Island Business News, and City & State Magazine. He hosted “The Steve Levy Radio Show" on Long Island News Radio, and is a frequent guest on high profile television and radio outlets. Few on the political scene possess Levy’s diverse background. He’s been both a legislator and executive, and served on both the state and local levels — as both a Democrat and Republican. Levy published Bias in the Media, an analysis of his own experience, after switching parties, with the media's leftward slant. Levy is currently Executive Director of the Center for Cost Effective Government, a fiscally conservative think tank. He is also President of Common Sense Strategies, a political consulting firm. To learn more about his past work and upcoming appearances, visit www.stevelevy.info. To read more of his reports — Click Here Now.
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