Obama Health Care Plan Would Cause Insurance Premiums to Skyrocket

The Obama health care plan will raise your insurance premiums a lot! You can verify what I write about the plan here: http://www.barackobama.com/pdf/issues/HealthCareFullPlan.pdf.

Speaking for your pocketbook, the scariest sentence in the plan is that it “will require insurance companies to cover pre-existing conditions…” That statement sounds wonderful for people with lots of medical problems, but if you already buy insurance now, it means that your insurance company will be forced to take all those people with very high risk medical conditions. Once added to the coverage pool, your premium will have to go up to help pay for their medical care.

The plan says “Insurers would have to issue every applicant a policy and charge fair and stable premiums that will not depend upon health status.” As it is now, your insurer does not have to issue everyone a policy. They can turn down high risk cases. And they are allowed to charge according to risk; those with lower risk pay less. While it sounds good to make insurance companies take everyone, keep in mind that if you already pay for insurance, either on your own or through your employer, you will be paying more so that those who have high risk can get insurance.

Missouri already has a program called the “High Risk Pool” Basically, it is for those people who cannot get insurance on the open market. In addition to the premiums it charges members, it is subsidized by a premium tax that insurers pay based upon their revenues. For people who cannot get health insurance otherwise, the premiums are high, but at least coverage is available.

I feel sorry for those who must pay high premiums because of their health status. But at least they have the high risk pool available, and we have Medicare and Medicaid for our disabled citizens. What I am concerned about is the coming wave of increased taxes and costs for which Obama is asking; a jump in health insurance cost will add to it.

Obama has said that taxes must rise in order to pay for everything he wants to do. The death tax elimination and income tax reductions are set to expire next year, and the democrats will certainly not stop it. The proposed “carbon tax” would add cost to literally everything we buy in proportion to the energy used in its production. And the stimulus will have to be paid back eventually, either through taxes or by the worst tax of all, inflation, caused by excessive government borrowing.

Most people would be upset if their tax bill suddenly increased by three or four thousand dollars a year. I suspect that they will be equally upset if their health insurance premiums and out-of-pocket costs increase by that amount or more under the Obama health plan. But I’m most worried about the dampening effect all this will have on our economy.

Last year in the Missouri House, I helped draft a plan that would have used market based reforms in order to allow competition to bring down insurance costs. More who are now uninsured would have been able to afford insurance. How? First, by requiring providers and insurance companies to estimate the cost of services in advance, consumers would have been able to make better choices. Quality rating scores would also have been required. Second, reform of the certificate of need law would have increased competition among hospitals. And third, the High Risk Pool would have been strengthened to help those who cannot qualify for insurance, the people who really need the help. Unfortunately, our House plan was killed by the hospital industry, a powerful lobby group. Hospitals desperately want to maintain their ability to operate without hammer of competition that would force them to lower costs. They lobbied against the bill and killed it.

Opening the health care market to competition and getting government out of the way would result in better, less expensive care. Unfortunately, today’s political balance won’t allow that—instead, those who think that government is the answer to all our problems will stand in the way, and will likely force government health care down our throats. But as Ronald Reagan said, government is not the answer to our problems; government IS the problem. And under Obama, I’m afraid our problems are just starting.