Bailout Time For Baby

The Greatest Socialist Baby, ObamaCare, needs a bailout diaper change because it’s overwhelming success in creating “better” and “more” Health Care for everyone has got some ‘wastage’ (aka poop) 🙂

When Obamacare was rammed through Congress without a single Republican vote way back in 2010, conservatives warned that the massive government program would ultimately require bailing out health insurance companies that gladly signed on.

Fast forward five years and it’s that time. Today on Capitol Hill, lawmakers are being pressured by the White House to provide money, or a bailout, to insurance companies losing money due to running government Obamacare exchanges. From The Hill

Republicans and Democrats are close to agreeing on delaying two major taxes, the “Cadillac tax” on high-benefit plans and the medical device tax.

But those proposals have run into opposition from the White House, which wants language fixing ObamaCare’s so-called risk corridors — a program intended to help insurance companies that take a financial hit by participating in government-run health exchanges.

That program is nearly out of money because of a policy rider sponsored by Sen. Marco Rubio (R-Fla.) on a year-end spending bill in 2014 that bars the Department of Health and Human Services from tapping into other accounts to fund it.

Rubio’s role has injected presidential politics into the debate, making it all but impossible for GOP leaders to agree to the White House’s demands.  

The talks appeared to hit a wall Monday when Republicans ruled out fixing the risk corridors, which they panned as a “bailout for insurance companies.”

“This is not on the table. Risk corridors is fully off the table,” said a Senate Republican leadership aide.

Despite the disagreement, Republicans are feeling optimistic they can get the healthcare pieces worked out.

Repealing the Cadillac tax, which hits the health plans of union members especially hard, is a priority of Reid’s and many Democrats.

But that was the “soak the rich” component of ObamaCare because only “rich”, well to do, greedy, people had those plans they said.They kneww they were lying but they didn’t care. The Agenda Uber Alles. It was a funding mechanism they used to sell the CBO (and thus con everyone else) on the BS that is ObamaCare.

My Blog Nearly 6 years ago (January 8th, 2010):

Those who think they’ll be exempt from the tax because their health care insurance isn’t one that Obama would define as a “super, gold-plated Cadillac” plan are kidding themselves. Douglas Holtz-Eakin, director of the Congressional Budget Office under George W. Bush, says 95% of Americans who are covered by plans that fit into the Cadillac category make less than $250,000 a year.

Even groups on the left get it. As Jim Kessler, vice president for policy for the progressive Third Way think tank, puts it: “A lot of those folks that have Cadillac plans have Chevy wages.”

Also don’t believe the claim that the tax will be on the insurance companies only. Sure, insurers will write the checks to Washington. But they’ll forward their costs to the customers, adding to a tax burden that’s already too punitive — and going to get worse.

“Passing the tax on to workers would result in an effective tax rate that is even higher than the specified 40%,” Curtis S. Dubay wrote in October in a Heritage Foundation WebMemo. “When the insurance companies embed the cost of the excise tax in premiums, the prices of plans will rise. A higher price means the excise tax would be higher, too.”

This would happen when the tax on a $10,000 individual plan adds $600 (40% of the $1,500 beyond the $8,500 threshold) to the cost, leaving a new premium of $10,600. The new cost will then be subject to the tax, boosting the premium another $840 (40% of the $2,100 over the $8,500 threshold). By now, that $10,000 plan is costing $11,440 a year.

“This cascading effect,” explains Dubay, “could raise the effective rate for the excise tax to 67% according to one estimate — considerably higher than the 40% specified in the bill.”

The problems don’t stop there. The growing premiums will drive many private employers that provide coverage for their workers to downgrade to cheaper insurance plans, which defeats the effort to improve health care.

A Liberal Democrat “soak the rich” scheme that blows up in their face and does the exact opposite. Nah, that never happened before…

See Alternative Minimum Tax 🙂

history2

The good news is, it looks like the Obamacare Cadillac tax will be repealed and insurance companies will have to take the hit they signed up for when they agreed to Obamacare years ago.

I’ll leave you with this, which explains why Democrats and Republicans are on board with repealing the Cadillac Tax.

They knew this 6 years ago, but THE AGENDA IS THE AGENDA, after all. 🙂

Most Americans don’t know what their insurance plans are worth. They’re happy to let their employers pay the premiums for them and believe that the money isn’t coming out of their pockets.

Very true.

Very Very true.

I heard a woman say, “Well, I just got out of the hospital. It cost $150,000. And I paid nothing. It was wonderful”

She was complaining about a $42 State Mandated charge in her car insurance. Because “I’m poor you know”. “I’m on a fixed income” (aka I relied on Social Security to pay for my glorious retirement).

And now 6 years later with the economy in the crapper because of Liberals they do it EVEN MORE now than they use.

People may not know the value of ANY insurance, but politicians know the value of politics. 🙂

“These are plans,” says the St. Pete newspaper, “that generally have very low co-pays and lots of extras.”

Sound familiar? Then either be prepared to pay more, or be stuck with a brass-plated, Yugo plan that’s more affordable. And while learning to settle for less, don’t forget: This grand reform effort coming out of Washington is supposed to improve our health care.(IBD and my Blog- January 2010).

It’s Bailout time, and you get stuck with Government “improved” Health Care and The Check.

Congrats. It’s a Whopper (from your own Burger KING). 🙂

Political Cartoons by Henry Payne

Terror Speech, Rick McKee,The Augusta Chronicle,Obama, ISIS, terrorism, terror, San Bernardino

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Laying Down The Law

claims

Insurance companies will have to pay out an average of 32 percent more for medical claims on individual health policies under President Barack Obama’s overhaul, the nation’s leading group of financial risk analysts has estimated.

That’s likely to increase premiums for at least some Americans buying individual plans.

The report by the Society of Actuaries could turn into a big headache for the Obama administration at a time when many parts of the country remain skeptical about the Affordable Care Act.

While some states will see medical claims costs per person decline, the report concluded the overwhelming majority will see double-digit increases in their individual health insurance markets, where people purchase coverage directly from insurers.

The disparities are striking. By 2017, the estimated increase would be 62 percent for California, about 80 percent for Ohio, more than 20 percent for Florida and 67 percent for Maryland. Much of the reason for the higher claims costs is that sicker people are expected to join the pool, the report said.

The report did not make similar estimates for employer plans, the mainstay for workers and their families. That’s because the primary impact of Obama’s law is on people who don’t have coverage through their jobs.

Like many poor people and the unemployed. The targets of ObamaCare. 🙂

And if you think, well I’m not one of those people so it won’t effect me…

WRONG!!

Insurance is a shared pool of risk. Everyone is in the pool and if Barack and Nancy are peeing in the pool you’ll get splashed with it.

Insurance companies uses the “Law of Large Numbers” and probability to determine the chance of an event occurring.  If the chance of someone having a car accident is one in one hundred, then insurance companies collect premiums from 100 people to pay the claim that one driver will incur. This is called “spreading the risk”. It is important for insurance companies to adequately gauge the hazards (items that increase the chance of loss) of a risk before insuring it.  If they don’t research and know a business or the habits of an individual and they guess wrong in predicting the chance of something happen the insurance company could lose money.  If they do this often enough then the company suffers.

Of course it is still up to chance but past experience is a good indicator of the future.

http://www.learninsurance.org/Content/LEARNING-INSURANCE/What-is-Insurance/Law-of-Large-Numbers.aspx

What you don’t understand will hurt you.

The purpose of insurance is to protect against loss. If there is no potential for a loss to occur or if there is potential for the person to profit or gain, insurance usually cannot be purchased.

It is not your personal bank and it is not a stock market and definitely NOT FREE MONEY!!! with no consequences.

While loss of property is certainly serious, an even greater potential for loss
exists when a person or family becomes legally obligated to someone else. The main difference between liability and property loss exposures, is that while the amount of a potential loss to property can rather easily be estimated prior to the loss, the amount of a claim for liability is not determined until after something has happened. Even then, it is difficult to predict what a judge or jury might determine a person must pay to another as compensation for damage or injuries.

Many people fail to recognize one of the most significant loss exposures they face—risk of losing their health and being unable to earn income. One of the biggest assets any person has is their potential earning capacity. If that potential is interrupted by ill health, disability, or death, there is a significant loss, not only to that person, but to others who are dependent upon them.

Property, liability, and human losses can be expensive. In addition to the financial impact, or direct loss, there may also be other costs that are not as obvious.

So now do you want the government bureaucrats involved in your Insurance? 🙂

At a White House briefing on Tuesday, Health and Human Services Secretary Kathleen Sebelius said some of what passes for health insurance today is so skimpy it can’t be compared to the comprehensive coverage available under the law. “Some of these folks have very high catastrophic plans that don’t pay for anything unless you get hit by a bus,” she said. “They’re really mortgage protection, not health insurance.”

See above. Do you think they understand? Do they understand risk management??

A prominent national expert, recently retired Medicare chief actuary Rick Foster, said the report does “a credible job” of estimating potential enrollment and costs under the law, “without trying to tilt the answers in any particular direction.”

Unlike 1-directional Liberals and progressives. 🙂

Kristi Bohn, an actuary who worked on the study, acknowledged it did not attempt to estimate the effect of subsidies, insurer competition and other factors that could mitigate cost increases. She said the goal was to look at the underlying cost of medical care.

“Claims cost is the most important driver of health care premiums,” she said.

The more claims, the more risk, the higher the premium. That’s NOT rocket science.

Oh, and those “subsidies” from government are what? SPENDING. So if the subsidies have to increase to hide the cost then the SPENDING will have to increase. And where does the spending come from?

Tax Payers! 🙂

Congratulations. You get to fun yet another self-bloating bureaucratic nightmare!

Aren’t you happy!!!!

Bohn said the study overall presents a mixed picture.

Millions of now-uninsured people will be covered as the market for directly purchased insurance more than doubles with the help of government subsidies. The study found that market will grow to more than 25 million people. But costs will rise because spending on sicker people and other high-cost groups will overwhelm an influx of younger, healthier people into the program.

Especially, when you are not allowed to manage your risks by Adverse Selection.

Some of the higher-cost cases will come from existing state high-risk insurance pools. Those people will now be able to get coverage in the individual insurance market, since insurance companies will no longer be able to turn them down. Other people will end up buying their own plans because their employers cancel coverage. While some of these individuals might save money for themselves, they will end up raising costs for others. (Yahoo)

But in a Me-Centered Universe isn’t that a win? 🙂

Go Me! It’s all about ME! ME ME! 🙂

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Insurance 201

Thomas Sowell has column today that is very well sad and I personally know the impact of it. And I have preached at this pulpit before.

https://indyfromaz.wordpress.com/2012/06/19/insurance-101/

In insurance markets, moral hazard occurs when the behavior of the insured party changes in a way that raises costs for the insurer, since the insured party no longer bears the full costs of that behavior. Because individuals no longer bear the cost of medical services, they have an added incentive to ask for pricier and more elaborate medical service—which would otherwise not be necessary. In these instances, individuals have an incentive to over consume, simply because they no longer bear the full cost of medical services.

And does this not sound like ObamaCare to you?? :)

Take it away Mr. Sowell.

Insurance is all about risk. Yet neither insurance companies nor their policy-holders can do anything about one of the biggest risks — namely, interference by politicians, to turn insurance into something other than a device to deal with risk.

By passing laws to force insurance companies to cover things that have nothing to do with risk, politicians force up the cost of insurance.

Annual checkups, for example, are known in advance to take place once a year. Foreseeable events are not a risk. Annual checkups are no cheaper when they are covered by an insurance policy. On the contrary, they are one of many things that are more expensive when they are covered by an insurance policy.

All the paperwork, record-keeping and other things that go with having any medical procedure covered by insurance have to be paid for, in addition to the cost of the medical procedure itself.

If automobile insurance covered the cost of oil changes or the purchase of gasoline, then both oil changes and gasoline would have to cost more, to cover the additional bureaucratic work involved.

In the case of health insurance, however, politicians love to mandate things that insurance must cover, including in some states treatment for baldness, contraceptives and whatever else politicians can think of. Playing Santa Claus costs a politician nothing, but it can cost the policy-holder a bundle — all of which the politician will blame on the “greed” of the insurance company.

(see Adverse Selection).

Insurance companies are regulated by both states and the federal government. This means that, instead of there being one vast nationwide market, where innumerable insurance companies compete with each other from coast to coast, there are 50 fragmented markets with different rules. That adds to the costs and reduces the competition in a given state.

When there are innumerable insurance companies, it is by no means clear that political regulation of them will produce better results than the regulation provided by competition in the market. In a competitive market, insurance companies would cover only those things that their policy-holders are willing to pay to have covered. Policy-holders would have no reason to pay to have insurance cover things that would be cheaper if paid for directly — or not paid for at all, in the case of things that are not a real concern to many people, such as baldness cures.

One of the factors in the number of the “uninsured,” for whom politicians are willing to turn the whole medical care system upside down, is the high cost of insurance that covers far more things than most people would be willing to pay for, if it was up to them. The uninsured who use hospital emergency rooms and don’t pay are a problem only because politicians passed laws forcing hospitals to let themselves be taken advantage of in this way.

Too many political “solutions” are solutions to problems created by previous political “solutions” — and will be followed by new problems created by their current “solutions.” There is no free lunch. In the case of health insurance, there is not even an inexpensive lunch.

Health insurance would be a lot less expensive if it covered only the kinds of risks that can involve heavy costs, such as a major operation or a crippling disability. While such things can be individually very expensive, they don’t happen to everybody, and insurance is one way to spread the risks, so that the protection of a given individual is not prohibitively expensive.

The problem of “pre-existing conditions” is a problem largely because of the way that politicians have written the laws — more specifically, by giving a tax break to employer-provided health insurance. If individuals bought their own health insurance, with the same tax advantages, the fact that an illness occurred after they changed employers would not make it a “pre-existing condition.”

There is no inherent reason for employers to be involved, in the first place. The fact that some guy manufactures furniture or plumbing fixtures in no way qualifies him to understand insurance for his employees. Including him in the loop adds another unnecessary layer of bureaucratic costs.

Political risks are the biggest risks.

So you want to know why your auto insurance is going up “even though I’m a good driver” or your Home insurance is going up “even though my house is worth less”??

Well, it’s very simple. Along with all of what has been discussed there is INFLATION.

http://www.bls.gov/data/inflation_calculator.htm

And the medical costs, repair costs and the lawyer  (you know all those “call me now” lawyer commercials?) costs go up and guess what happens to your premiums. They go up. It’s not personal.

And any real homeowners policy will be based on the replacement cost of the home and not the market value because the market value is a) fickle (just think about 5 years ago) b) includes land and locational factors that have nothing to do with the home.

Example, my home. It’s located with the “noise zone” of Sky Harbor International Airport. Thus my house is technically worth less because you can hear plane noise at a certain level.

If my house burns down do I want the replacement cost based partially on that or do I want it based on the materials to rebuild it?

And if inflation in the cost of those materials cause the premium to go up?

I hope you see the point.

Most people don’t.

Why?

Narcissistic Greed. It’s all about ME! and Insurance should only be about ME.

I don’t want MY policy based on other people.

Which is a fundamentally flawed understanding of the entire concept of insurance in the first place.

And that lack of education is a real problem because it leads people to misunderstand the entire process and the fundamentals underlying the entire concept.

And lets politicians and manipulative Liberals get away with their “solutions” that just cause more problems but make them look good.

And thus, you go for “get rich quick” type schemes by manipulative politicians that actually CAUSE more problems than they solve. But you get the satisfaction of “sticking it” to them. But it’s you that ultimately gets stuck.

Oh, there are ways to bring it down, but reforms to litigation laws and practices (by politicians who are mostly lawyers) is very hard. Lobbyists are very strong in the area. This is their meat and potatoes.

Medical costs are skyrocketing and ObamaCare will just make them worse. Trying to reform that gets you “thrown grandma off the cliff” rhetoric.

So, in the end RHETORIC HAS IT’S CONSEQUENCES.

Consequences in your wallet.

That’s the risk.

Political Cartoons by Glenn Foden

Political Cartoons by Glenn Foden

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The Creation Myth

In the beginning Government created the heavens and the earth…

Between April-June 2012, an estimated 246,000 Americans were added to Social Security’s disability insurance program. In that same time period, only 225,000 American jobs were created.

Since 2008, 3.6. million Americans have been added to Social Security’s disability insurance program. In that same time period, a net total of 1.3 million jobs were lost.

While fewer Americans are working than at the end of 2008, 3.6 million Americans have been awarded SSDI benefits over the same period. The growing number of people on disability and other federal benefits, combined with weak economic growth, raises serious concerns about the sustainability of the American economy.

Today only 1 percent of Social Security disability recipients ever return to work. (KFYI)

Barack said to him, “I am the way, and the truth, and the life; no one comes to the Father Government, but by me. 7 If you had known me, you would have known my Father also; henceforth you know him and have seen him.” 8 Philip said to him, “Lord, show us the Government Father, and we shall be satisfied.” 9 Barack said to him, “Have I been with you so long, and yet you do not know me, Philip? He who has seen me has seen the Father; how can you say, ‘Show us the Father’? 10 Do you not believe that I am in the Father and the Father in me? The words that I say to you I do not speak on my own authority; but the Father who dwells in me does his works. 11 Believe me that I am in the Father and the Father in me; or else believe me for the sake of the works themselves. 12 “Truly, truly, I say to you, he who believes in me will also do the works that I do; and greater works than these will he do, because I go to the Father. 13 Whatever you ask in my name, I will do it, that the Father may be glorified in the Son; 14 if you ask anything in my name, I will do it. (Apologies to John)

In the beginning, Government provided the infrastructure that permitted the success of American companies. After seven days, government rested.

Until President Obama clearly reinforced the government-Creationist perspective, Americans truly did not understand the greatness of our government and all that it has done for us.

If not for Government (like God, Government should be capitalized), Henry Ford would have never invented the car. Quite obviously, Ford thought, now that Government has created roads, he must put a vehicle on them.

Thank Government!

Just as apparently, God, in his infinite wisdom, must have realized that Government-created trails needed horses. So He created them.

In a similar vein, God realized that with Government-created footpaths, feet would be ideal. So, responding to the brilliance of Government-created footpaths, God allowed man to evolve to walk upright.

Praise Government for all that flows!

In the Garden of Eden, the Bible describes the story of Adam and Eve, in which the two are warned against eating the fruit from the “tree of knowledge of good and evil.”

Obama’s perspective on his revisionist bible is a classic example of rewriting history to suit the fallen eaters of the fruit of that tree.

Apparently, the founding fathers destroying one form of government to create a less intrusive one was lost on this president. Apparently, this president fails to understand the plain meaning of the Declaration of Independence:

“When in the Course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness, —That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, —That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.”

Our founding fathers threw off the oppressive government of England for a new form of government, a government that provided the framework for a people to live in freedom.

Government derives its power only from the people it serves. Obama seems to think that the government came before the people, and not the other way around.

Perhaps Obama needs to stop eating apples! (Frank Ryan)

The President stood in the presence of God (himself) and it was good. 🙂

In his war on American exceptionalism, President Obama has turned the sights on exceptional Americans. If you’ve built a successful business, it wasn’t your dream or your sweat — somebody else made it happen.

The unbridled disdain President Obama has for the entrepreneurs who work hard and risk everything was made plain when he told supporters in Roanoke, Va.: “If you’ve got a business — you didn’t build that. Somebody else made that happen.”

This was stunning news and a colossal slap in the face to the millions of small-business owners who get up every day and by the sweat of their brow and the drive of their ambition still pursue the American dream in spite of the obstacles and hurdles this administration has put in front of them.

In Obama’s collectivist world view, we are all ants on a socialist ant farm. We are sheep being led by a government shepherd. Wealth, as we now know, is not to be created but to be redistributed in the manner of the Marxist slogan — to each according to his need and from each according to his ability.

Your success, Obama says, is not your own. There “was a great teacher somewhere in your life,” he tells us, and that somebody “invested in roads and bridges.”

Is it a coincidence that virtually the only people President Obama gives credit to for anything are teacher and construction unions? 🙂

And have you ever noticed that when discussing job losses the Liberal are always focused on government sector and public union job losses?

And, with apologies to Al Gore, we are told: “Government research created the Internet so that all the companies could make money off the Internet.”

So Steve Jobs, Bill Gates, the founders of Google, Facebook and Twitter, are all parasitic pretenders.

Without government, there would have been no Mac computer or iPad? Michelangelo didn’t paint the Sistine Chapel, you know. Credit must be given to the folks who built the scaffolding and the inventor of paint.

Of course, this is the president who, in a speech delivered at a high school in Osawatomie, Kan., last December, argued while a limited government that preserves free markets “speaks to our rugged individualism,” such a system “doesn’t work” and “has never worked” and that Americans must look to a more activist government that taxes more, spends more and regulates more.

Free-market capitalism and limited government took us from a colonial backwater to an economic and military superpower that could defeat Imperial Japan, Nazi Germany, Fascist Italy and the Soviet Union and then put men on the moon simply because we wanted to.

Now we have an administration that says the American people are helpless without it while it outsources space travel to the Russians.

Forget Thomas Edison, Henry Ford, Alexander Graham Bell, the Wright Brothers and the risk-taking dreamers still among us. They have a harder time these days, shouldering the highest tax and regulatory burdens in the world and beset by bureaucrats, regulators and environmentalists.

President Obama, the community organizer who never ran a business or met a payroll, wants to increase their energy and health insurance costs.

The president’s plan to raise taxes on earnings above $200,000 ($250,000 for joint filers) would hit 1.2 million small-business employers who pay their taxes through the individual income tax.

This condemnation of rugged individualism and the entrepreneurial spirit comes from a leader who has been dubbed the “food stamp president” and who has done more to increase dependence on government than any other. Let us see your college transcripts, Mr. President. And who helped you on your way besides Saul Alinsky and Bill Ayers?

If risk-takers succeed, Mr. President, they do so in spite of government, not because of it. You want to take credit for everything and responsibility for nothing.

Look at the wreckage of your policies, sir, and take the blame instead. (IBD)

But we already know it’s Bush’s Fault, now don’t we kids! 🙂

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Insurance 101

ObamaCare and Insurance 101. It may be a bit dry, but this is the problem with it and why the claims of lower premiums was such a lie and why this whole thing was either a scam or more pie-in-the-sky feel good liberalism taking a piss on reality.

So the Democrats have started working on what if it’s struck down:

Under the law, insurers would still have to accept all applicants regardless of health problems, and they would be limited in what they can charge older, sicker customers.

As a result, premiums for people who directly buy their own coverage would jump by 15 percent to 20 percent, the Congressional Budget Office estimates. Older, sicker people would flock to get health insurance but younger, healthier ones would hold back.

To forestall such a problem, the administration asked the court – if it declares the mandate unconstitutional – to also strike down certain consumer protections, including the requirement on insurers to cover people with pre-existing health problems. That would mitigate a damaging spike in premiums. (AP)

So the administration wants the parts that they say “the people love” to be struck down to mitigate the damage. Fascinating… 🙂

Kind of like the Mandate was going to be great for everyone, then 1700+ waivers, mostly to unions, were granted because it was going to hurt these people.

And of course, it wouldn’t be there fault when grandma gets thrown off a cliff and run over by the bus! 🙂

Mind you, as I have said since this whole thing started that ObamaCare was designed to destroy the private insurance industry and replace it with nothing but government controlled insurance anyhow.

Adverse Selection: It describes a situation where an individual’s demand for insurance (either the propensity to buy insurance, or the quantity purchased, or both) is positively correlated with the individual’s risk of loss (e.g. higher risks buy more insurance), and the insurer is unable to allow for this correlation in the price of insurance. This may be because of private information known only to the individual (information asymmetry), or because of regulations or social norms which prevent the insurer from using certain categories of known information to set prices (e.g. the insurer may be prohibited from using information such as gender, ethnic origin, genetic test results, or preexisting medical conditions, the last of which amount to a 100% risk of the losses associated with the treatment of that condition). The latter scenario is sometimes referred to as ‘regulatory adverse selection’.

The insurance company is unable to screen out “pre-existing conditions” so premiums will be higher simply because people with conditions that will cost more than the premium can charge will rush to the door and flood the system thus causing a financial hardship on the company. Thus premiums will inflate to cover this.

This has always been one of the factors in ObamaCare that made me laugh when they said premiums would go down.

That is simply NOT POSSIBLE with “pre-existing conditions” mandated.

But does that mean that people like this are just left out in the cold by mean old, greedy insurance companies?

No.

There are risk pools for that. Pools usually subsidized for their high risk, much like Flood is or that idiot driver that you can’t refuse auto insurance to even though they’ve had 5 DUI’s in the year (yes, that does really happen- rare, but it does happen).

2010: Last year, Charles Baker, former CEO of Harvard Pilgrim Health Care, one of Massachusetts’s largest health plans, noticed some health insurance brokers posting comments on his widely read blog. They were suspicious that people were applying for health coverage after a medical condition developed, got the care they needed, and then dropped the coverage.

From April 2008 to March 2009, 40% of the individuals who applied to Harvard Pilgrim stayed covered for less than five months. Yet claims were averaging about $2,400 a month, about six times what one would expect.

Blue Cross and Blue Shield of Massachusetts has now confirmed it is experiencing similar problems. The company says that in 2009, 936 people signed up for three months or less and ran up claims of more than $1,000.

And that’s just Two Examples. Just Two. From 2010. Imagine the Future.

Furthermore, if there is a range of increasing risk categories in the population, the increase in the insurance price due to adverse selection may lead the lowest remaining risks to cancel or not renew their insurance. This leads to a further increase in price, and hence the lowest remaining risks cancel their insurance, leading to a further increase in price, and so on. Eventually this ‘adverse selection spiral’ might in theory lead to the collapse of the insurance market.

And ObamaCare does this in spades, but with the Mandate in place these lowest risk individuals are not allowed to cancel and assume their own risks. Not without a penalty and a visit from an IRS agent that is. But if the penalty is less than the premium then you just keep gaming the system.

To counter the effects of adverse selection, insurers (to the extent that laws permit) ask a range of questions and may request medical or other reports on individuals who apply to buy insurance, so that the price quoted can be varied accordingly, and any unreasonably high or unpredictable risks rejected. This risk selection process is known as underwriting. 

That’s why now a policy can be cancelled by Underwriting if it is found you made fundamentally false statements because it has to be assumed at the time of the contract that both parties are acting in good faith.

Mandates increase a moral hazard is a situation where there is a tendency to take undue risks because the costs are not borne by the party taking the risk.

Uber Liberal Economist Paul Krugman described moral hazard as “any situation in which one person makes the decision about how much risk to take, while someone else bears the cost if things go badly.”

Aka, you and higher premiums.

Also you get high premiums from what could be called REGFARE (aka Regulatory Warfare) and boy does the Obama Administration love using this with HHS, The EPA, The FCC, the IRS, Justice Dept., ad nauseum.

In insurance markets, moral hazard occurs when the behavior of the insured party changes in a way that raises costs for the insurer, since the insured party no longer bears the full costs of that behavior. Because individuals no longer bear the cost of medical services, they have an added incentive to ask for pricier and more elaborate medical service—which would otherwise not be necessary. In these instances, individuals have an incentive to over consume, simply because they no longer bear the full cost of medical services.

And does this not sound like ObamaCare to you?? :)

Example: if you know you have terminal cancer and you buy insurance to cover your last 6 months but don’t disclose this to the insurance company (“pre-existing condition”) the company will be paying 10’s of thousands of dollars in claims potentially with virtually no premium to cover that.

Now multiply that by millions of people. The 30 million uninsured. They may not all have this intent, but the scale is still relevant and the effect is too.

Are you starting to see the problem here and how ObamaCare was meant to subvert it?

And if it’s struck down, the Democrats will just come back with another pig and new lipstick.

Being able to decide who lives and who dies and to control every facet of your life “to cut your costs” (Food Police anyone?) is the Holy Grail of Liberalism so they won’t give up if even if it’s unconstitutional. They’ll just re-brand it and call the pig by another name but the effects will still be the same though.

LAWFARE. Waging a war by lawsuits and REGFARE, waging war by regulation and subversion of Adverse Selection and Moral Hazard.

That’s the Insufferably Morally Superior Left in a nutshell.

So endeth the lesson.

Political Cartoon by Chuck Asay
Political Cartoons by Lisa Benson

Political Cartoons by Glenn Foden

Known and Unknown

Thomas Sowell: When Donald Rumsfeld was Secretary of Defense, he coined some phrases about knowledge that apply far beyond military matters. Secretary Rumsfeld pointed out that there are some things that we know that we know. He called those “known knowns.” We may, for example, know how many aircraft carriers some other country has. We may also know that they have troops and tanks, without knowing how many. In Rumsfeld’s phrase, that would be an “unknown known” — a gap in our knowledge that we at least know exists. Finally, there are things we don’t even know exist, much less anything about them. These are “unknown unknowns” — and they are the most dangerous. We had no clue, for example, when dawn broke on September 11, 2001, that somebody was going to fly two commercial airliners into the World Trade Center that day. There are similar kinds of gaps in our knowledge in the economy. Unfortunately, our own government creates uncertainties that can paralyze the economy, especially when these uncertainties take the form of “unknown unknowns.” The short-run quick fixes that seem so attractive to so many politicians, and to many in the media, create many unknowns that make investors reluctant to invest and employers reluctant to employ. Politicians may only look as far ahead as the next election, but investors have to look ahead for as many years as it will take for their investments to start bringing in some money. The net result is that both our financial institutions and our businesses have had record amounts of cash sitting idle while millions of people can’t find jobs. Ordinarily these institutions make money by investing money and hiring workers. Why not now? Because numerous and unpredictable government interventions create many unknowns, including “unknown unknowns.” The quick fix that got both Democrats and Republicans off the hook with a temporary bipartisan tax compromise, several months ago, leaves investors uncertain as to what the tax rate will be when any money they invest today starts bringing in a return in another two or three or ten years. It is known that there will be taxes but nobody knows what the tax rate will be then. Some investors can send their investment money to foreign countries, where the tax rate is already known, is often lower than the tax rate in the United States and — perhaps even more important — is not some temporary, quick-fix compromise that is going to expire before their investments start earning a return.

Although more foreign investments were coming into the United States, a few years ago, than there were American investments going to foreign countries, today it is just the reverse. American investors are sending more of their money out of the country than foreign investors are sending here.

Since 2009, according to the Wall Street Journal, “the U.S. has lost more than $200 billion in investment capital.” They add: “That is the equivalent of about two million jobs that don’t exist on these shores and are now located in places like China, Germany and India.”

President Obama’s rhetoric deplores such “outsourcing,” but his administration’s policies make outsourcing an ever more attractive alternative to investing in the United States and creating American jobs.

Blithely piling onto American businesses both known costs like more taxes and unknowable costs — such as the massive ObamaCare mandates that are still evolving — provides more incentives for investors to send their money elsewhere to escape the hassles.

Hardly a month goes by without this administration coming up with a new anti-business policy — whether directed against Boeing, banks or other private enterprises. Neither investors nor employers can know when the next one is coming or what it will be. These are unknown unknowns.

Such anti-business policies would just be business’ problem, except that it is businesses that create jobs.

The biggest losers from creating an adverse business climate may not be businesses themselves — especially not big businesses, which can readily invest more of their money overseas. The biggest losers are likely to be working people in America, who cannot just relocate to Europe or Asia to take the jobs created there by American multinational corporations.

But at least the Class War Fare so loved by Liberals has a target rich environment (in their minds) because any “rich” person should be bludgeoned to the point of death to make up revenues for the Liberals to spend on their Socialism.

Not to cut spending. No paying down the debt. No, never that.

And any hint of doing that get’s them riled up and scare people on Social Security that the government won’t pay them because the Republican Boogieman is coming to get you!!

And I’m still waiting for the Republicans to buckle.

The Democrats have already stepped up the Class Warfare and the Fearmongering.

So all is right with the Political World…. 😦

That is well known. 🙂

Political Cartoons by Steve Kelley

Political Cartoons by Chuck Asay

Political Cartoons by Michael Ramirez

Political Cartoons by Jerry Holbert

Political Cartoons by Chip Bok

Stop the Insanity!

Political CartoonObama said Congress had its “most productive post-election period” in decades. “And it comes on the heels of the most productive two years that we’ve had in generations.”

<<Industrial strength Super-Mega Sized Barf Bag!!!>>

Obama is correct though, the Republican rolled over more and played fetch in the Lame Duck session more than the last 2 years.

I guess Republicans should never go Duck hunting because they are completely useless at it and like one of the old Daffy Duck cartoons the duck just takes the dog (or elephant) to the cleaners and just runs circles around him and laughs insanely.

Now:  President Barack Obama says the economy will be his “singular focus” over the next two years.(AP)

Jan 9, 2010:  The Labor Department’s report on December job losses “was a reminder that the road to recovery is never straight, and that we have to continue to work every single day to get our economy moving again,” Obama said. “For most Americans and for me, that means jobs.”

Then Chief of Staff and “Never Waste a Crisis” Rahm Emmanuel:  “If he didn’t address it like a laser, if he talked about jobs then, people would have said he wasn’t dealing with the problem at hand. You have to deal with all of it.” (FOX)

Jan 21, 2010:  President Obama already was planning to put a heavy focus on jobs and the economy in next week’s State of the Union address, but his top aides are signaling that pivot is going to be even sharper in the wake of the Democrats’ stunning election defeat in Massachusetts. (CNN)

Dec 4, 2009: Obama convenes a summit here on jobs, then flies Friday to Allentown, Pa., for the first in what will be periodic listening tours on the economy. The goal is to develop new spending and tax proposals to help many of the nation’s nearly 16 million unemployed people find work in 2010.

“Though the job losses we were experiencing earlier this year have slowed dramatically, we’re still not creating enough new jobs each month to make up for the ones we’re losing,” Obama said last week. “For families and communities across the country, this recession will not end until we completely turn that tide.”

July 29, 2008: Mr. Obama’s focus on jobs seemed intended to show his mastery of an issue of special concern to working-class voters, especially working-class whites in industrial swing states like Michigan, Ohio and Pennsylvania. During the Democratic primaries, those voters tended to support his main rival, Senator Hillary Rodham Clinton.

“The economic emergency is growing more severe,” Mr. Obama said just before the afternoon meeting began. “Jobs are down, wages are falling,” and “the financial markets threaten to be engaged in a protracted credit crunch with long-lasting ramifications.”

“I believe more action is going to be necessary,” he added, “so that entrepreneurship is encouraged, so that the market is thriving, so that hard work is rewarded.” (NYT)

I believe him. Don’t you? 😦

This will probably be gone from his mind on the plane to Hawaii. He has more important things to think about.

He still has to convince the new 112th Congress to pass the DREAM ACT & Cap & Trade after all. Leave no AGENDA item undeterred!

LET THE RATIONING BEGIN

The FDA has reversed its approval of a widely used cancer drug approved in Europe to treat breast cancer on the grounds it doesn’t provide a “sufficient” benefit. Let the terminally ill and their doctors decide.

One of the blessings of blocking the omnibus spending bill was that it included $1 billion for the implementation of ObamaCare.

Yet the first effects are still being felt, the latest being the Food and Drug Administration’s revoking of regulatory approval of Avastin to treat late-stage breast cancer.

The reason given by the FDA was that the drug does not provide “a sufficient benefit in slowing disease progression to outweigh the significant risk to patients.” What risk? These women are dying.

The drug buys them precious time, and the only risk they face is from an FDA saying “pull the plug.”

On the same day the FDA channeled Dr. Kevorkian, its European counterpart, the European Medicines Agency, issued a statement approving Avastin for metastatic breast cancer.

Benefits of the drug, it said, “continue to outweigh the risks, because the available data have overwhelmingly shown to prolong progression-free survival of breast cancer patients without a negative effect on the overall survival.”

So what say you, FDA? An agency overseeing the cost-conscious, government-run health care systems in the European Union says Avastin does provide sufficient benefit at little risk to the patient.

The annual cost, however, is a staggering $88,000 annually, and under ObamaCare cost trumps medical care. A prime decision is whether extending your life is worth the cost.

Consider that every year some 17,500 American women are prescribed Avastin by their practicing oncologists to treat their condition and prolong their life. Last October, the U.S. National Comprehensive Cancer Network, a group of 21 leading cancer centers that issues evidence-based medical guidelines, reaffirmed Avastin’s efficacy in certain cases.

Avastin, the marketing name for the drug bevacizumab, is the world’s best-selling cancer drug. Used primarily to treat colon cancer, it was first approved by the FDA in 2008 for treating breast cancer after it was found that by cutting the blood flow to tumors it slowed the progression of the disease. In some cases it has been shown to extend life as long as 20 months.

In a joint letter to the FDA and key lawmakers, two organizations — Susan G. Komen for the Cure and the Ovarian Cancer National Alliance— urge that Avastin continue to be approved for metastatic breast cancer patients and warn of the message this “decision sends about drug development for women with advanced breast cancer.”

Breast cancer is the second most common cause of cancer death among American women, with 40,000 fatalities last year. Komen says the decision to use Avastin should be made between a woman and her doctor after a thoughtful consideration of the benefits and risks. We agree.

Avastin is still available on an off-label basis since it is still approved for colon, lung, kidney and brain cancer. But insurers are reluctant to cover drugs that are not FDA-approved. Medicare never does and the Centers for Medicaid and Medicare Services are now headed by Dr. Donald Berwick, to whom we and others have referred as a one-man death panel.

“The decision is not whether or not we will ration care — the decision is whether we will ration with our eyes open,” Berwick has said. For some that will mean the eyes closing forever.

Berwick has also opined: “We can make a sensible social decision and say, ‘Well, at this point, to have access to a particular additional benefit (new drug or medical intervention) is so expensive that our taxpayers have better use for those funds.'”

Like what? Tattoo-removal programs or Formosan subterranean termite research? This is your government, and it’s here to help. (IBD)

Tiny Tim to Dr. Berwick, “God bless us, everyone.”

Oh sorry, that was too religious for the political correct anti-christian liberals out there that scream every time God is mentioned.

Good. 🙂

Political Cartoon