Market Mad House

In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. Friedrich Nietzsche

My Thoughts

A Few things to keep in mind about Obamacare and Trump

daniel , , , , ,

There are a few things that everybody should understand about President Donald J. Trump’s (R-New York) 13 October decision to end some Obamacare subsidies. Knowing these details will give you a very different perspective on the matter.

Here is what everybody needs to understand about the Obamacare subsidies.

  1. Democrats; such as U.S. Senator Chuck Schumer (D-New York) and Nancy Pelosi (D-California), are more responsible for this situation than Trump. They created the system that puts millions of innocent Americans at the mercy of Obamacare subsidies.

 

  1. Trump’s actions may not take health insurance away from anybody. All the Donald did, was to end subsidies that make it easier for private insurance companies to issue policies to certain people through Obamacare exchanges.

  1. The Obamacare exchanges were already a failure before Trump’s action. There will be 45 counties in the United States where plans will be available on the exchanges next year, The New York Times reported in June. There will be 1,388 counties where just one Obamacare plan will be available next year.

 

  1. Many of the Obamacare policies offered through the exchanges do not meet the needs of average people. Some of the so-called Bronze policies have deductibles of $6,000 which make them useless for average Americans, Healthpocket reported. The same policy has a premium of $743.52, making it a terrible deal.

 

  1. Trump is basically right when he describes the subsidies as payments to insurance companies.

 

  1. Strangely enough, it is a subsidy insurance companies do not want. The nation’s largest private health-insurance provider UnitedHealth Group (NYSE: UHC) pulled out of all but a handful of exchanges this year, Time reported. UnitedHealth left most state exchanges for the simple reason it cannot make money on them.

  1. The number of people affected by Trump’s action is small – only around 35,000 people live in counties with no policies on the Obamacare exchanges, The Times

 

  1. There is a simple and very cheap solution to this problem. Congress can simply make our existing national health insurance product; Medicare, available to all the people and employers that participate in the Obamacare Exchanges.

 

  1. Offering Medicare might be cheaper than Obamacare. Back in 2011, The Kaiser Family Foundation estimated Medicare’s administrative costs at 2% of operating expenditures. The administrative costs for private insurance were estimated at 17%.

  1. Medicare is a better deal than Obamacare. The average Medicare Part B premium in 2017 is $134; $109 for Social Security recipients, Medicare.gov The average Medicare A deductible is $1,316 per benefit period.

 

Disturbingly nobody, not Trump, not Pelosi, and not Schumer, mentioned the Medicare option during the political firestorm that erupted over this issue. Cynics would point to campaign contributions from health insurers as the reason for that omission.

There is one other obvious conclusion we can make from all this. U.S. Senator Bernie Sanders (I-Vermont); the most visible advocate of Medicare for All, has won the Obamacare debate. Trump, Pelosi, and Schumer had better used to that reality and fast if they want to retain any political influence anywhere in America.