Tuesday, August 11, 2009

"If You Like Your Current Plan you Can Keep It" Is a Phony Promise

Obama's claim that if you like your current health insurance (through your employer) then you can keep it, is misleading. As in many things,"the devil is in the details". Here are details that make Obama's claim disingenuous. First, the "government option" plan,or the equivalent "states cooperatives" plan, will make all private plans non-competetitive in cost. After all, the government doesn't have to make a profit and can subsidize its cost through a wide variety of income, sales, and value-added taxes or by deficit spending, with associated inflation, that the average insured employee will not directly attribute to their health care cost but nonetheless will lower their standard of living. This will drive private insurance companies out of business. Second, employers will compare the cost to their corporation of providing health insurance to their employees versus the possible fines for not offering private health insurance to their employees. The government can control these fines and set them so as to induce corporations to drop their health plans and tell employees to sign up with the government option. This is easy for the government to manipulate. In this case, it doesn't matter if you are happy with your current plan; your employer will have an incentive to shift you to the government option. Third, the government can impose strangling restrictions on keeping private plans such as not allowing you to add new family members to your private plan, not requiring, or even allowing, employers to take on new employees to existing plans so if you change jobs you are driven into the government option and not allowing you to change the coverage options you have in an existing plan. Those that have studied the various House versions of the ObamaCare bill say that all of these possibilities are allowed within the language.
Canada started with a government option and wound up with a government-run single-payer plan.
Obama's intent is there in his own words from the past: 1. Obama to AFL-CIO in 2003" " I happen to believe in a single payer universal health care program. .... But as you all know we may not get there immediately".
2. Obama to Service Employees International Union in 2007: "My commitment is to make sure we have universal health care for all Americans by the end of my first term as President. ... I would hope that we could set up a system that allows those who can go through their employer to access a federal system or a state pool of some sort. I don't think we are going to be able to eliminate employer coverage immediately. There is going to be potentially some transition process." Do either of these statements sound like Obama intends for you to keep your private health insurance?

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