Obamacare, California and Breaking Eggs

By Michael Reagan
Monday, July 07, 2014 at 3:25pm

During the formative years of the Soviet Union it’s said that Lenin was once discussing the deaths and privation caused by the Communist Revolution and he justified it all by saying, “You can’t make an omelet without breaking eggs.”

To which many Russians thought, “What omelet?” (Saying it aloud could get you executed or sent to a camp.)

The story is no doubt apocryphal, but it applies to our current situation under the Obamacare regime.

Many liberals and sympathizers were looking forward to diving into the great Obamacare omelet where healthcare is universal, excellent and free; only to discover their role is to supply the eggs.

A recent opinion piece in the Washington Post is a perfect example of how the left views the Obamacare rollout. Reporter Reid Wilson calls California the “Best state in America for its smooth rollout of the Affordable Care Act.”

The question for us is: At what cost? Well, here are some facts.

A total of 2.5 million signed up for coverage. Almost half of the signups were for Medicaid or other programs where taxpayers (or Chinese lenders) bear the cost of the bill rather than the recipient. Of the 1.4 million that enrolled in marketplace plans there is no breakdown on who is paying the full fare for their insurance and who is getting a subsidized plan.

Without knowing how many are getting free, or below cost health insurance, and how many are paying their own way, it is impossible to calculate if Obamacare in California is fiscally sustainable in the future.

The one jurisdiction where we do have figures on young people paying for their coverage is the District of Columbia where 45 percent of the signups were “from the highly sought-after 18-to-34 age group.”

But even that is less positive than it seems because these young people are “largely…Capitol Hill staffers who had to enroll through the District’s exchange,” which means that taxpayers are indirectly footing the bill for this coverage, too.

But that’s how economics works on the left, you move money taken from taxpayers from one pocket to another and — presto chango — you’re creating jobs and adding to the gross national product!

But outside the insulation provided by tax dollars, Obamacare isn’t working so well for the egg providers.

To begin with, approximately one million responsible Californians who had been following the rules lost their insurance policies due to Obamacare, reports California Healthline — an organization generally favorable to the new law.

And these Californians who weren’t part of the problem are getting a shock when they buy their “new, improved” policies on the California exchange.

Obamacare, as part of the omelet-making process, requires all healthcare policies to cover a number of tests and procedures that an individual policy holder may not want. Maternity coverage for single men or senior citizens comes to mind. And insurance companies are not allowed to let the age of the consumer influence the premium.

So senior citizens, who use healthcare extensively, will be charged the same rate as a 25-year-old Obama supporter. (You may think this qualifies as just desserts, but it won’t help if the 25-year-old opts out.) Which means the Obama supporter’s premium is much higher than before because he’s subsidizing grandma’s hip replacement.

Here’s how this works in the Golden State.

Researchers took a policy offered by Kaiser Permanente before Obamacare and compared it with an identical policy offered after Obamacare.

The monthly premium for the ‘pre’ policy was $100. The ‘after’ policy premium was $205. Lisa Aliferis, a reporter for the KQED “State of Health” blog found that Californian Mark Brown’s premiums, also with Kaiser, went up 90 percent.

And even if you can afford the new policy there is no guarantee you can see a doctor, because rationing is also part of this omelet.

Covered California has been making a big deal out of how it’s holding insurance rates down. But it does it by drastically cutting the reimbursement rate paid to doctors. Dr. Richard Thorp, president of the California Medical Association, told the Washington Examiner, “We need some recognition that we’re doing a service to the community. But we can’t do it for free. And we can’t do it at a loss. No other business would do that.”

California pays 30 percent lower Medicare rates than in the rest of the country. For example, in most states a doctor is paid $76 for follow-up doctor’s office visits. In California it’s $24. The rate for a tonsillectomy varies from $500 to $700 around the country. In California, a surgeon is paid $160 for the same procedure. These rates are one reason the Examiner estimates 70 percent of California doctors are not participating in the program.

And these cuts are rippling down the line. According to a report on KBPS.org, California hospitals are responding to “performance-based reimbursement” with job cuts. An unnamed medical group in the San Francisco Bay area is expected to cut more than 200 jobs in response to financial pressure.

So the new coverage that the Post’s Wilson claims is such a success will be useless if the covered can’t find a doctor or can’t get admitted to an over-crowded hospital.

As Alex Briscoe, director of the Alameda County Health Care Services Agency, explained, “Enrollment doesn’t mean access, because there aren’t enough doctors to take the low rates of Medicaid. There aren’t enough primary care physicians, period.”

Yet Wilson writes, “The Golden State’s solutions have turned out to be just what the doctor ordered.”
So this is how the left and its cheerleaders in the media define success: Free health insurance is given to thousands, while responsible taxpayers who were already covered lost their policies and will now pay thousands more for new coverage they didn’t want.

Doctors will be expected to do the same work for many more patients at the lowest reimbursement rates in the country.

And the left could care less about the skyrocketing premiums because, on the one hand, the people with subsidized policies won’t feel the bite as politicians will just shake the money tree again and tax dollars will magically fall to the ground.

And, on the other hand, the people who pay their own way just have to understand. I have seen the future of Obamacare and it’s California, where they like to break eggs to make smaller and smaller omelets.

I strongly encourage you to join with us at the League. Your support is vital for us to continue this fight to stop Obamacare and his liberal agenda. Please take a moment and
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Michael Reagan is chairman of the League of American Voters.