The Glade 4.0

The mandate was the most controversial part of the ACA, but it's just one piece. The ACA expands insurance coverage and access to / affordability of health care through a variety of mechanisms, including the following:

• guaranteed issue (insurance companies have to take everyone, including those with pre-existing conditions)
• partial community rating (everyone pays relatively similar premiums, regardless of their individual health status)
• annual and lifetime coverage caps banned
• subsidies for low-income people to buy insurance
• young adults can stay on their parents' insurance (which is usually cheaper and better) until age 26
• expanded eligibility for Medicaid

The problem with all that is that many people would just free-ride by not getting insurance until they were already sick, knowing that guaranteed issue and community rating would require the insurance companies to cover them whenever the time came. So, we have the mandate to prevent such free-riding and maximize the size of the risk-pool.

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“Strong people are harder to kill than weak people, and more useful in general”. - Mark Rippetoe

Other than expanded Medicaid (which states can reject apparently?) this doesn't provide anyone with free health insurance then? It just means everyone has to buy it or pay a tax?

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You missed the subsidies part, Hop. Also, it means that people who normally wouldn't be able to get insurance, because they're an incredibly BAD insurance risk (and thus would only be offered at premiums so high it's not worth it/affordable, since the insurance companies know the house is going to lose on the insurance gamble, as it were) must be offered insurance now. This is nominally offset, to the insurance companies, by the requirement that healthy people must buy insurance, thus increasing the pool of "good" bets (for the house) on the insurance gamble.

In addition, the annual and lifetime caps are banned, with an effect on expanding the coverable pool similar to the above.

Aside from the expanded Medicaid and subsidies, the AFA was never about "free" health care. It's about mandating that the insurance industry doesn't get to pick and choose its customers (something that insurance -- or the health care industry, in general, when you look at hospitals & emergency room service) needs to do to stay in business, or else raise its prices on everybody to cover the costs of the people who everybody knows won't end up paying in as much as they consume.

In order to do that, the bone thrown to the insurance industry (and hospitals) was that we can make sure they have more paying customers and fewer free-riders who unexpectedly get sick/injured without coverage, respectively, by making everybody buy insurance. As anybody in the health care industry with any economical acumen at all can tell you, the few 20-somethings who have been opting not to carry insurance aren't going to cover the astronomical costs the requirement to let everybody have access to insurance, and regulation on how steep coverage can cost, are going to incur, which will have to be made up for by the bolded part above.

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"Aaaah! Emotions are weird!" - Amdee
"... Mirrorshades prevent the forces of normalcy from realizing that one is crazed and possibly dangerous. They are the symbol of the sun-staring visionary, the biker, the rocker, the policeman, and similar outlaws." - Bruce Sterling, preface to Mirrorshades

Kaffis, how is the insurance market not going to fall apart within this model? I cannot foresee this working out well....won't private insurance companies go bankrupt or something?

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"Therefore do not worry about tomorrow, for tomorrow will worry about itself. Each day has enough trouble of its own." Jesus of Nazareth

You can see very clearly what happens if you check out Massachusetts who implemented something very similar in 2006:

http://en.wikipedia.org/wiki/Massachuse ... m#Outcomes

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Ok I read like half of that and the words and figures started melting together....TLDR summation?

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"Therefore do not worry about tomorrow, for tomorrow will worry about itself. Each day has enough trouble of its own." Jesus of Nazareth

More people get covered, but there's no free lunch, so the extra costs get spread around among the various participants in the system - employers, hospitals, insurance companies, individual plan subscribers, taxpayers, etc.

So is it still going to be profitable to be in the insurance business in the private sector? Or is this the beginning of a transition to govt health insurance for everyone and the eventual disappearance of private insurance?

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"Therefore do not worry about tomorrow, for tomorrow will worry about itself. Each day has enough trouble of its own." Jesus of Nazareth

it doesn't, and single payer healthcare rides in to "save the day."

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I prefer to think of them as "Fighting evil in another dimension"

Its still using insurance for many things that should never be used for insurance such as known costs.

You do not insure a pre-existing condition. It makes absolutely no sense to do so.

Oh you know you're going to need to take x pills every y often. Thats the same as knowing you need gas or food -so would anyone propose food or gas insurance as a good idea?

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"...but there exists also in the human heart a depraved taste for equality, which impels the weak to attempt to lower the powerful to their own level and reduces men to prefer equality in slavery to inequality with freedom." - De Tocqueville

Food and gas insurance is a brilliant idea. It should be added to Obamacare.

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Buckle your pants or they might fall down.

In the short to medium term, yes, private insurance remains profitable and sustainable. Not as profitable as before, but certainly still worthwhile. In the medium to long term, I don't think anyone really knows for sure, and predictions are usually heavily influenced by the political views of the person making the prediction. Insurance could go the way of large-scale utilities and become so highly regulated that the government essentially sets the price on a "cost plus reasonable profit" basis. Or it could split into a two-tier system where the government provides single-payer universal coverage for standard things and a wholly private market exists for "deluxe" coverage. Or we could get a system where the government provides insurance for everyone (e.g., like France). Or we could get a system where insurance largely disappears and the government just pays directly for health care (e.g., like Britain).

FWIW, my prediction is that we'll gravitate toward a combination of the two-tier standard/deluxe system and the French universal insurance system.

It might be. All Catherine sebellius needs to do is wave her hand and make it happen. Kinda like Dolores umbridge

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A man who has nothing for which he is willing to fight, nothing which is more important than his own personal safety, is a miserable creature and has no chance of being free unless made and kept so by the exertions of better men than himself. ~ John Stuart Mill

Thanks RD.

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"Therefore do not worry about tomorrow, for tomorrow will worry about itself. Each day has enough trouble of its own." Jesus of Nazareth

So far it has cost twice as much as planned and the % of uninsured hasn't dropped as much as intended. In the short-term MA Insurance rates soared much higher than the national average before levelling off to.... exactly the national average increase. http://www.forbes.com/sites/carolynmccl ... are-costs/

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More people between me and my doctor = higher cost. Now we've allowed people with zero accountability to be the middleman. Yeah this will work great. At least my aetna stock will be secure.

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A man who has nothing for which he is willing to fight, nothing which is more important than his own personal safety, is a miserable creature and has no chance of being free unless made and kept so by the exertions of better men than himself. ~ John Stuart Mill

It doesn't matter how much it costs..

It's good for the 'people'...

It'll be profitable as long as the insurance companies are allowed to raise their rates to remain profitable. As the crackdown on that basic quality of free enterprise had already begun to be eroded by Sebelius years ago, for example. It's pretty obvious what the intent of the Fed Gov't is.

All of the "mechanisms" that are intended to "expand insurance coverage and access to / affordability of health care" are, by the very nature of selling goods and services, going to be passed down to the consumer, the paying consumers who still remain on private insurance, and the taxpayer - whether they consume the product or not. Here are some more "expansion/accessibility mechanisms".

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"Dress cops up as soldiers, give them military equipment, train them in military tactics, tell them they’re fighting a ‘war,’ and the consequences are predictable." —Radley Balko

I'd love to know how universal private healthcare can work out even in theory. If you're talking about the government subsidizing private industry, well that's what Obamacare is. If you're talking about the government not being involved.....that just doesn't work.

The fact is, fully private health care is pretty much guaranteed to be a huge drop in the quality of care for a very simple reason: Our current health services are financed via massive borrowing. A for-profit private health care system can't be built on borrowed money. The vast majority of the population can't actually afford a 79-year life expectancy. Today, we have a system where people retire at age 65 and continue living past age 85, doing nothing productive for over 20 years. Do you know how much that costs? Medicare borrows two thirds of its budget. Very, very few seniors can afford anything else besides Medicare because the actual costs of health care in old age are just that immense. Even if privatization results in an absolutely massive increase in efficiency, it's still not likely to provide the same level of care we get now. The average cost of providing medical care for a 65 year old until death is now over $1.25 million. How many people retire with $1.25 million? Hell, how many people retire with even $500,000, let alone $500,000 to spend on health care?

Even if a theoretical private enterprise can provide the same quality of care for half the price as Medicare, it's still a huge step back in overall quality.

If you want the life expectancy in the US to be over 70, you must "rob the rich." There's no way around it. If you put this burden on the individual, you are basically telling the population that you need to be a millionaire if you want to expect to live to 75, and if you want to live to 85 you better have more than $5 million.

Again, all of your (worthless) data is collected in the vacuum of a single centralized system whose internal metrics are all completely compromised by the single largest price fixing entity on the planet. Until you understand that you're standing in the center of the forest, there's no point in discussing the trees with you.

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Ezekiel 23:19-20 

Did you miss the part where I acknowledged the fact that private health care would result in a large increase in efficiency?

Just to break even, the theoretical private system would have to provide the same quality of care provided now for one fourth of the price. To make a profit, the increase in efficiency would have to be even greater.

What data do you have that indicates this kind of massive increase in efficiency is possible? Yes, I understand that government meddling inflates prices. I don't buy for a second that it's more than quadrupled them.

This is not a given by any stretch. Pretty much everything about the nature of health care makes it a bad fit for efficient market competition - there's a massive information asymmetry between supplier and consumer; delaying or foregoing purchase is often not an option; substitute products are limited or non-existent; willingness-to-pay for the most expensive care (i.e. the life-saving kind) is virtually unlimited; the ability to evaluate quality of care and compare between providers is minimal; and so on.

Total horseshit. The more an institution or industry is bureaucratized the less efficient it becomes. There is nothing government or monopoly does more efficiently than the market.

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Ezekiel 23:19-20 

I'll take "Ideological Absolutism" for $1000, Alex.

The mechanism by which markets achieve efficiency is competition, and there are a number of factors weighing against effective competition in the market for health care, as noted in my post. A blanket statement that every market for every product that ever was or ever will be must always, by its very nature as a "market", be efficiency-maximizing is just dogmatism.