I see 2 BIG "Unintended Consequences" with this Health Insurance Reform:

[Junkdrawer]

1.) Increased Age Discrimination
Depending on which bill you read, older workers will pay two to five times as much for their health insurance as younger workers. If you think employers shy away from older workers now....

2.) Decreased Consumer Spending
If you mandate the purchase of insurance, the money available for "discretionary spending" will take a very, very big hit. Now the mandates won't kick in right away, but I'm thinking this "recession" will probably still be going on when it does.

[Hello_Kitty]

1. Yep. #2 is the big one.

I've actually gotten into arguments here on DU where I point out how expensive insurance is if you don't get it through work especially if you're working in a low wage service job and gotten responses like "well they have money for cell phones and flat screen TVs and the latest fashions and going out drinking don't they?" Um, assuming that's case for every uninsured young person - that they really have the money and are choosing to spend it on other things - this is a consumer based economy and those purchases create jobs.

[Junkdrawer]

4. There's a reason advertising targets a younger audience...

They're the ones who buy - they don't have responsibilities yet. And now they will have a lot less money.

[Hello_Kitty]

12. Bingo.

What's especially unfair to them is how they now get to subsidize via the purchase of expensive mandated insurance the Lipitor of the very same old farts who ushered in Ronnie Raygun and the trickle down bullshit theories that wrecked the economy.

[bvar22]

16. They are going LOVE making out that check every month...

Of Course, they WILL blame The Democrats.
Rightly so.

[joeycola]

7. low wage workers do not have the money for insurance. simple as that.

[lumberjack_jeff]

18. Under reform, they won't need money for insurance.

Minimum wage workers would be eligible for expanded medicaid.

[Ikonoklast]

25. Then they will qualify for the public option.

Simple as that.

[girl gone mad]

11. All of those things are much cheaper than health insurance.

I can buy a flat screen TV for under $1000... turn it on, know it works, use it every day, it should last for many years to come. The insurance would cost 4 times that, per year and who knows if it would even work when and if I needed it? It's a crappy product, that's why so many people don't buy it. They aren't stupid, lazy or selfish. They are simply making a choice as consumers not to buy a defective product.

[Hello_Kitty]

13. Yep.

You're way better off buying the TV.

[AdHocSolver]

33. That flat screen TV cost about $100 to manufacture in China. Buyers are overpaying about $500.

Americans have to be the most stupid consumers on the planet. A few years ago, Americans were paying $100 a pair for designer sneakers that cost about $3.00 to manufacture in Asia.

The guy who is on Medicare and opposes a public option health insurance plan because he doesn't want to be dependent on government bureaucracy is the poster boy for the typical stupid consumer.

Your example doesn't work.

[girl gone mad]

34. None of what you said contradicts my example.

Most Americans are stupid consumers, which probably explains why most Americans overpay for crappy health insurance policies.

The television may only cost $100 to manufacture (there would still be shipping, advertising, distribution, warranty, etc. charges), but all in all, it's affordable to most people and it's a rare expense (I've bought two TVs this decade). That people might pay more for it than it's really worth is the result of easy credit artificially inflating demand by making the product seem more affordable, not mere consumer ignorance.

Regardless, I doubt that anyone is choosing to buy designer sneakers or televisions instead of health insurance. They are deciding that the health insurance is unaffordable and unreliable.

[napi21]

2. Ins. premiums are based partly on age NOW. For businesses,

your premium is based on avg age of your workforce & the past year's experience in claims. I remember being part of the negotiations at one of my jobs, and the VP of Finance was all t'd off because one of our employees (who was 26 years old) had fallen off a ladder and broke his back. The expenses were enormous & caused our premiums to increase for the next year!

As far as comsumer spending goes, too much as not yet been decided yet as to what would be the level whre you would get a subsidy to help pay for the ins. How much would a basic plan be? Most consumer spending is done by people WITH jobs!

[Junkdrawer]

6. This will make the increased cost much more immediate....

particularly with non-professional jobs. Especially if the differential is more than 2 times.

[Ms. Toad]

32. The difference for small employers is already far more

than 2 times. Larger plans typically can negotiate better deals because of the larger pool. Limiting the differential to 2 (or even 5) is an improvement - you might want to spend some time trying to find insurance for a small business (or pretend you are and talk to some insurance brokers). It's an eye opener, and you might realize how much of an improvement this limitation is.

[gravity]

3. How do you think they pay for insurance now?

Insurance companies already set different rates based on age. People are already giving their discretionary spending money up to pay their insurance premiums.

The only difference is that under Obama's plan, these premiums would hopefully be going down, which will increase discretionary spending.

[theophilus]

5. Well, I predictiate just the opposite. Premiums go down. More money to spend. n/t

[Junkdrawer]

8. Remove lifetime and yearly caps, prevent preexisting condition denials...

and premiums go DOWN?

Also, if you're young and you don't have insurance, any premium is more that no premium. Not saying that they shouldn't buy health insurance, just that there WILL be a consequence in regards to discretionary spending.

[Hello_Kitty]

17. Mandates are to (many) Democrats what tort reform is to Republicans.

A magical elixir that will bring health insurance premiums down to nearly nothing.

[bvar22]

19. Its not really Health Insurance.

It IS Wealth Insrance for the For Profit Health Insurance Industry.

[girl gone mad]

9. 3.) Young people will abandon the Democratic party.

Forcing people to donate a portion of their meager paychecks to private health insurance companies in exchange for an unreliable product of questionable benefit is guaranteed to drive them away.

[Warren Stupidity]

10. You seem to be assuming that everyone will be purchasing individual insurance.

While I seem to think that instead, nothing much will change except that people currently not covered will have better options to get covered (which may include a mandate and subsidies for coverage.) The vast majority of people are already covered by work, by medicare, by medicaid, or by the military. I am not a big fan of the general framework being proposed, I understand the opposition to mandates, but I do not see this as a major change from the current system, other than more of the 47 million uninsured will have coverage.

Romney care, for all of its many faults, has in fact reduced the uncovered population in Massachusettes from somewhere between 7-10% to around 2.6% and it hasn't wrecked the economy or severely impacted purchasing power.

[Junkdrawer]

20. I think that multipliers will be used within companies....

Companies already have an Individual vs. Family rate

From the Baucus Plan:

...

Health insurance premiums would be allowed to vary based only on tobacco use, age, and family composition according to the following ratios:

Tobacco use – 1.5:1

Age – 5:1

Family composition:
Single – 1:1
Adult with child – 1.8:1
Two adults – 2:1
Family – 3:1

...


http://voices.washingtonpost.com/ezra-klein/BaucusFramework.pdf

[Warren Stupidity]

28. Perhaps over time. And yes everything Baucus does sucks.

So lets see what we actually end up with and complain about that.

[bvar22]

21. There ARE DUers from Mass. who disagree with you.

You should check with them.

[Warren Stupidity]

27. I live in NH and work in Mass and know lots of people

who work and live in Mass and NONE of them have been affected at all by Romneycare as they all have insurance through their employers, which is my point.

[bvar22]

29. So your point is meaningless.

Check with some people who ARE affected by Romeycare.
Those who have posted here have been very negative.

[Warren Stupidity]

30. I'll try again.

My point is not meaningless. My point is that romneycare and what it is looking like is going to happen in Washington does not and will not affect most people because most people are already covered under one of the existing programs (workplace, medicare, medicaid, veterans) and both romneycare and what is likely to come out of Washington leave the existing programs pretty much alone. This is minimal reform. It will affect the small group of people (10% in Mass, using the largest estimate, around 15% of the entire nation) who weren't covered before, and the effect for that group will be generally positive. It will hardly affect at all the rest of us - the 85% or so who are already covered.

The OP is one of many that predict DIRE CONSEQUENCES from truly minimal reform. These dire consequences, predicted from the right and the left, are ludicrously wrong for the reasons I just stated: what is proposed is a truly minimal reform to the existing system. These minimal reforms will not have any effect at all on the vast majority (around 85%) of the population.

As for Massachusetts - coverage went from 90% to 97.5%. Are there problems? Of course. Is it an ideal system? Heck no. Has it extended coverage to people who previously had none? Yes it has.

[bvar22]

35. Mass uninsured rate has gone UP!

"The Massachusetts plan, passed in 2006 with the support of then-Governor Mitt Romney, is stumbling financially because far more people need help than Romney originally estimated; the state now believes there may be as many as 650,000 uninsured, not 400,000. And there's a shortfall in funds to cover the subsidies those people have been promised. The uninsured have come out of the proverbial woodwork to buy insurance rather than face tax penalties, and since many of them cannot afford coverage, the state is on the hook for their premiums. "Romney won acceptability by obscuring how much money is really needed in the absence of genuine cost controls," says Boston University professor Alan Sager, who specializes in healthcare costs.

Massachusetts had budgeted $472 million for the current fiscal year, but it needs an additional appropriation of $150 million, which will come out of the public purse. Next year could be bad too. When the law was passed, a legislative conference committee projected that $725 million would be needed for subsidies in the third year. Now it looks like the program will need $869 million to cover premiums for those who can't afford them. "I wouldn't characterize the situation as dire," says Jon Kingsdale, chief executive of the Commonwealth Health Insurance Connector Authority, which administers the program. "The affordability issue has always been there." Just last Thursday Leslie Kirwan, state budget director and chair of the authority, said the program next year will cost "significantly" more than $869 million. Money counted on by the law's architects has not materialized. Lawmakers had counted on getting about $500 million to $600 million from the state's free-care pool, which paid hospitals to treat the poor. The theory was that more insured residents would mean less need for free care. But apparently people are still uninsured and need care, so that money is not available. And assessments from employers are not adequate either. Instead of requiring them to cover their workers, the law allows employers to pay $295 per employee per year to help cover the uninsured. The sum was a compromise to keep employers from fighting a mandate that would have required them to spend upwards of $9,000 a year on real insurance for each employee. The state has collected only $6 million so far. One reason: before he left office, Romney changed the rules so fewer employers would be subject to penalties."

http://www.thenation.com/doc/20080407/lieberman

Is this what you want for the whole nation?

[Kat45]

31. I'm in MA and I'd be screwed if we didn't have it

My job got eliminated last year and for 7 months I could not find any job at all. Cobra was not available to me. If it wasn't for the state's health insurance, I would be uninsured. Because I had no income, I am on a plan that has been subsidized 100% by the state. It's not a Cadillac plan, but it's not bad. Last month I got a part time job and I sent the information in to the state. I haven''t heard back from them yet, but since I'm making such little money I think I will still be eligible for this insurance, if not free then with a good subsidy. For those with higher incomes who don't have insurance through work, the state makes decent insurance plans available for a better rate than one would have otherwise. When I had looked into it when I lost my job, I think a single person could get a policy for somewhere around $300 a month. No it's not cheap but it's a heck of a lot better than it was.

Edited to add: Although I'm grateful to have this right now, I am absolutely in favor of a single-payer system. I've been arguing for that since before HMOs existed.

[ProSense]

14. That will not be the

case

[lumberjack_jeff]

15. The subsidies are structured in such a way that #2 nonexistent.

The only persons whose spending is affected are those with incomes of $50,000 and up who previously chose to forego insurance. Besides, the current situation forces those people into bankruptcy when they get sick, and everyone else to pick up the bill.

Many lower income people scrimp to buy their expensive insurance now. Those people would have more discretionary income.

The currently insured who get a subsidy under reform will get a windfall.

#1 is probably unavoidable. It is politically impossible to get young voters to agree to a mandate to pay insurance based on the rates a 60 year old would deserve... and I'm pushing 50.

[Hello_Kitty]

22. For about the zillionth time, lumberjack_jeff

The majority of people who go bankrupt from medical bills HAD insurance. Furthermore, the percentage of people making $50k and more a year who are uninsured by choice is very small.

[gravity]

23. That is why Obama is proposing new regulations for insurance

so insurance companies can't drop people as easily and have to pay for preexisting conditions.

You are just treating Obama's plan like it is just forcing people to buy insurance under the old system and regulations, instead of the one he is proposing.

[Hello_Kitty]

26. The tough regulations need to be put into place BEFORE there is a mandate

Seems like the opposite is happening here. They're starting with the mandate and reverse-engineering from there. Not acceptable. If the plan comes out and it resembles Max Baucus' plan you could be out over $20k a year in premiums and out of pockets if your family makes $67K a year. You think people wouldn't still be going bankrupt with those kind of costs?

[Nikki Stone1]

36. "The majority of people who go bankrupt from medical bills HAD insurance." YES YES YES

Can't say that enough.

[msongs]

24. u mean beyond that Death Scare companies are gonna EFF up everyone they can for profit? nt