The optimistic promises of the Affordable Health Care Act (i.e., Obamacare) have simply not worked out nor will they ever work out. In fact, millions of Americans who don’t get health coverage at work and up until now, faced two undesirable options: either going without insurance or paying Obama- care’s skyrocketing premiums. But, last Thursday, President Trump announced changes that will allow consumers to choose coverage options costing half of what Obamacare’s cheapest plans (known as Bronze or those inferior to Gold and Silver plans) cost, and despite Democrats’ objections, these changes will reduce the number of uninsured – something Democrats claimed as their goal.
Obamacare requires everyone to buy the one-size-fits-all package. You have to pay for maternity care, even if you’re too old to give birth, and you have to pay for pediatric dental care even if you have no children. Trump’s new executive order frees people to again buy “short-term” health plans that exclude many costly services such as inpatient drug rehabilitation. Although these plans are not guaranteed to be renewable year to year, the enormous advantage is they cost much less.
Short-term plans have existed for years. After Obamacare premiums began soaring, they became attractive to people who were ineligible for an Obamacare subsidy and balked at paying full cost (a prime example of the middle class getting shafted while the liberals deceptively claimed helping them). Hundreds of thousands signed up for them until a year ago when President Obama slapped a 90-day limit on the plans as a way to force people into Obamacare no matter how unaffordable.
Trump’s order removes Obama’s 90-day limit, reopening that low-cost option, thereby helping 8 million people currently getting whacked with the Obamacare tax penalty for not having insurance, and another 11 million uninsured who avoided the penalty by pleading hardship. Now, with an affordable option, the number of uninsured will be reduced.
Democrats are ranting that Trump’s regulatory changes will cause healthy people to abandon the Obamacare exchanges to buy these lower-cost plans. However, reliable research indicates that 83 percent of participants who get subsidies are unlikely to drop out. Obviously, many people who are paying full cost with no subsidies will opt for affordable alternatives and why shouldn’t they when Obamacare forces the healthy to pay the same for insurance as the chronically ill – a fatal actuarial flaw that was inserted from the beginning to try to make something work that couldn’t otherwise survive.
People with pre-existing conditions should be subsidized, but instead of burdening health insurance buyers in the tiny individual market, the entire nation should chip in. For the millions getting subsidies, soaring premiums have not been a problem, but they have clobbered the nearly 9 million who don’t, with their premiums more than doubling since 2014 and set to rise another 25-35 percent this winter. Trump’s new regulation will enable a sizeable number of these people to bail out and buy cheaper options.
Trump’s order also endorses so-called association plans, allowing small employers and even individuals to group together and buy insurance across state lines, thus giving the same purchasing clout as large multi-state employers.
Next, look for Trump to stop enforcing the tax penalty on those who don’t buy Obamacare plans, thereby hastening its demise. Finally, Trump should cancel the sweetheart gold plans Obama gave to congressional members and their staffs at taxpayers’ expense in order to get their votes for passage (what an outrage!); then, see how quickly they will repeal and replace Obamacare.
Acknowledgement is given to Betsy McCaughey’s article (NY Post) for information in my column.