Category Archives: SCOTUS

Obamacare’s Biggest Legacy? More Welfare Beneficiaries.


Once upon a time, in the darkest, most putrid bowels of the White House, the diabolical creators of the worst piece of health legislation in American history connived to completely uproot one-sixth of the economy by convincing the populace this was first, necessary, and second, a boon to the country.

The Obamacare architects knew that there weren’t that many Americans truly locked out of health insurance, and certainly not in the numbers that would justify such a massive overhaul. Yet they, with the help of the lapdog media, touted completely bogus numbers of 45 MILLION!, 47 MILLION!, and 50 MILLION! (depending on the source) to get your attention.

It worked, didn’t it? And we all felt bad to learn this, didn’t we? Half of the country was covered by company plans and we thought it was unconscionable that people hoping to purchase their own health insurance couldn’t afford to.

We were told in 2010, by Jonathan Gruber’s CBO, that the Obamacare insurance exchanges would cover 22 million more Americans by this year (which is, you’ll note, less than half of the purported 50 million uninsured. Some “universal coverage” plan!).

We were also told that insuring these long-suffering individuals would actually save us money!

“$2500 per family per year!”

Employers “would see premiums fall by as much as three-thousand percent, which means they could give you a raise!

Eureka, Big Daddy Government will deliver us from ever-increasing health care costs!!! We’re on board!

Now, of course, we realize that the middle-class is taking this law directly on the chin. Workers with health insurance benefits are seeing their out-of-pocket costs skyrocket — while many in the individual market have decided to take their chances as they abandon expensive Obamacare policies with unreachable deductibles. 

Meanwhile, as the Congressional Budget Office churns its new Obamacare numbers, we find that the 2009-2010 CBO — Jonathan Gruber’s CBO — was remarkably off-base in its projections. In short, this year’s CBO report shows that the enrollment numbers are roughly half the 21-22 million 2016 exchange customers CBO had consistently forecast in years past, even as recently as March 2015. 

 

Get this: For all the sacrifice
the American people are making,
only 10 million people
are expected to be enrolled
in the exchanges by year’s end.

 

So what happened? 

Well, what happened was that an unexpectedly large number of Americans were folded into Medicaid, the worst coverage in the entire country, instead of signing up for Obamacare plans.

As the Weekly Standard’s Jeffrey Anderson points out, “In 2013, the CBO projected that, in the absence of Obamacare … 34 million people would have been on Medicaid or CHIP” in 2016.

What are the Medicaid/CHIP numbers now? 

Sixty-eight million. 

That’s right. Sixty-eight million American human beings are now on (lousy) Medicaid. Let that sink in.

Even better news for Progressives: CBO also believes that slower wage growth in the future will qualify even more Americans for the welfare programs.

What’s ironic for Obamacare proponents is that increased Medicaid enrollment also poses an existential threat to the exchanges. Take it from CBO itself, which projects that “as more people become eligible for Medicaid coverage, enrollment in coverage through the marketplaces will decline.”

Dentons, a global legal firm, maintains that this is already happening:

“Medicaid and the Children’s Health Insurance Program (CHIP) cover 17 million more people in 2016 than projected, while private insurance through the non-group market, including exchanges … covers 10 million fewer people. Millions of young, healthy people are enrolled in Medicaid and CHIP, rather than in private insurance offered through the exchanges.”

Before a 2012 Supreme Court ruling made Medicaid expansion optional for the states, CBO assumed all Americans with incomes at or below 138 percent of the federal poverty level (FPL) would receive Medicaid. Nineteen states are currently opting not to expand, so a smaller pool of Americans are Medicaid-eligible.

Still, as Dentons notes, “in the past six years Medicaid and CHIP enrollment has nearly doubled from the 2010 baseline.

We’ve repeatedly been told that state legislatures opting not to expand their Medicaid programs are “greedy, selfish and uncaring.” Yet it is in Medicaid expansion states that Obamacare enrollment and risk pools suffer the most.

In non-expansion states, low-income, young, able-bodied Americans can purchase highly-subsidized exchange policies and help to balance out the costs of older, sicker enrollees. In expansion states, those same young, able-bodied Americans at or below 138 percent FPL are FORCED into Medicaid — as in:

“Sorry, you can’t have a real insurance policy.
You’re too poor.”

In the nation as a whole, insurers need about 40 percent of Obamacare enrollees to be 18- to 34-year-olds. Meanwhile, over at healthcare.gov, only “26 percent of the individuals who selected, or were automatically reenrolled in, a 2016 Marketplace plan are ages 18 to 34.” 

Where’d they go?
Medicaid, anyone??

The Wall Street Journal reports the reason the young and healthy are needed in the exchanges: to “hold down premium rates by balancing out the greater medical spending of older enrollees.” Insurers are already dismayed over the greater-than-expected costs of their current Obamacare populations and are threatening to raise 2017 premiums by double digits. As a result, reports of adverse risk selection and death spirals are proliferating.

It wasn’t enough that Progressives like Harry Reid, Chuck Schumer, and Nancy Pelosi put the exchanges at risk by insisting on a Cadillac Tax delay — which thus postpones the incentive for employers to dump workers in the Obamacare “exchanges, whether they like it or not.

Now we see that their failed Medicaid policies have doubled down on the damage.

The Obamacare exchanges are doomed,
and Progressives have only themselves to blame.

Advertisements

Sarah Kliff’s Recycled Mess

Among the many recently trotting out heart-breaking tales of woe — to shamelessly pressure the Supreme Court in King v. Burwell — is Sarah Kliff, with a piece titled:

“The Supreme Court’s Obamacare decision will determine
if this cancer patient gets chemotherapy.”

You can be forgiven for not having seen the article. In fact, our crack research team almost missed it. It was published on June 12 in an outlet called Vox, led by America’s alleged wunderkind and intellectual giant Ezra Klein. 

Vox is a site hosting writers who enjoy referring to themselves as “wonks” and “nerds” because it makes them sound brighter than they really are. Actually, they’re just partisans.

Lefties like these are growing increasingly nervous as Decision Day draws near in King v. Burwell. Perhaps that’s why Kliff re-ran her story of Marilyn Schramm, which she first posted — with the same title — on February 26, 2015. 

One wonders why she couldn’t locate another anecdote.

Here’s what Kliff wrote, in both pieces:

Marilyn Schramm is thinking about moving. She is a 63-year-old retiree who lives in Texas, and since November 2013 she’s purchased health insurance through Healthcare.gov. She has a policy that costs about $800 per month. Schramm, who earns $28,000 from her pension, pays about half the cost, and the federal government covers the rest with a subsidy.

Her best back-up plan right now, she says,
is moving to a place with a state-run exchange.

(emphasis added)

We’ll refer you to John Sexton of Breitbart to give you his take on Kliff’s first post. 

We’ll also add that Ms. Schramm appears to be an attorney who retired from the Texas state government in 2010 and started her own consultancy business in 2011.

And Kliff doesn’t tell us why Ms. Schramm had to sign up with Healthcare.gov. Was she one of the millions whose coverage was canceled in late 2013? Kliff conveniently omits those details.

What’s more important is that Ms. Schramm, and everyone else in her position, receive some sound financial advice. 

Kliff could have been trying to antagonize the Justices when noting Ms. Schramm may choose to relocate, but she inadvertently described a solution for Americans in Healthcare.gov states. 

Yes, Ms. Schramm, you can — and should — move to a state with its own Obamacare exchange. It’s only logical.

Think about it. Older Americans migrate to certain states to avoid taxes on pension benefits and estates. Some move to states with lower income taxes, while others favor states with minimal property taxes. 

Americans rightly gravitate to states that meet their personal needs. Even on a local level, undocumented immigrants are attracted to sanctuary cities.

So if the King plaintiffs prevail, Americans in states with federally-established exchanges won’t really lose taxpayer subsidies. They can still receive them — in the Progressive states who will welcome them with open arms. 

Those states can be referred to as Medical Sanctuary States (or MeSSes).

Keynesian theorists understand that states with greater public spending promote economic growth. And, as our national treasure Jonathan Gruber explains, Progressive states, since they also embrace the expansion of Medicaid, will experience a major economic stimulus from the influx of federal dollars. 

In other words, the MeSSes will economically thrive!

And it just keeps getting better. Liberal voters, eager for Obamacare subsidies, Medicaid, and other government benefits, should flood these MeSSes, thereby tipping census figures in those states and changing the numbers in the House, Senate, and Electoral College. 

They’ll also overtake Conservatives in their state legislatures, improving state economies further through mandated minimum wages, higher state income, sales, and inheritance taxes, and other socially Progressive policies.

The best part? As Gruber notes, Conservative states will be paying federal taxes for the perks available in the MeSSes, thus accelerating the redistribution of wealth.

Given these obvious results, Progressives should cheer if the Obama administration is defeated in King v. Burwell. They just don’t realize this due to their basic “lack of economic understanding.”

Hmm. In originating the Obamacare subsidies cases, including King, what were Michael Cannon and Jonathan Adler thinking? Are they really just Progressives in sheep’s clothing? (Snark intended.)

Research on Past Health Reform Efforts Yields a Slam-Dunk for King v. Burwell Plaintiffs

The stakes are awfully high in the SCOTUS King v. Burwell ruling, to be announced later this spring.

If the Supreme Court decides the administration illegally extended Obamacare subsidies to those enrolled through Healthcare.gov, many Americans will lose the financial aid they were promised and find health insurance coverage unaffordable.

[By the way, this begs a few questions: Why is the government mandating that Americans buy individual policies that are, on average, 49% more expensive than they were pre-Obamacare — after scheming to throw millions of Americans off their old policies? Aided by the over 500,000 health insurance agents in the country, aren’t we capable of finding insurance that meets our particular needs? Or are we just too stupid to know what’s good for us?]

On the other hand, a ruling for the plaintiffs would release 57 million Americans from mandates to which the law, as written, did not subject them. Employers in most states could relax about the law’s potentially huge blow to their financial health, countless Americans would no longer fret about dealing with IRS employees tasked to oversee their premium payments, and state economies could improve.

A most stunning and disappointing episode in U.S. politics is revealing itself, as Congressional Democrats are now forced to admit they didn’t read the fundamentally transformative bill for which they voted in 2009 and 2010. Pro-government amicus briefs assert that Congress never intended — or worse yet, understood — that premium subsidies were restricted to state-established exchanges, despite the law’s clear language.

It’s as if they’re saying, “Never mind what we voted for! What’s important is what we thought we were voting for!”

Would that work with your mortgage? Would a bank allow you to unilaterally change the terms of your home loan because you didn’t read — or understand — the contract you signed? That’s the federal government’s position here.

And are Congressional Democrats telling us the truth about their intentions in 2009 and 2010? Remember: these are the very same people who repeatedly assured us we could keep our plans and our doctors.

The administration maintains that it’s well within its bounds to rewrite Obamacare. It also says it would have been “perverse” for Congress to pressure states to cooperate with the sweeping law by holding premium subsidies over their heads.

Thanks to a great deal of health reform research, we know this kind of perversity has endured through over four decades of proposals, from Nixon, through Clinton, and through subsequent plans.

This Forbes analysis gives the details, but here’s the takeaway: Given the history of U.S. health reform efforts, it’s looking likely the King plaintiffs are correct in claiming Obamacare drafters aimed to punish refusenik states. In fact, after digesting this research, we may legitimately ask, why wouldn’t they?

The Role of Timothy Jost in Obamacare’s “King” Problem

No one — outside an inner circle of Obama advisors — knows who snuck those four little words, “established by the state,” into Obamacare when it was being crafted. Nobody’s owning up.

But at least one person was writing about withholding subsidies in non-cooperative states while the bill was being created.

In a 2009 paper titled “Health Insurance Exchanges: Legal Issues,” Professor Jost proposed options for creating health insurance exchanges under national health care reform. And he obviously didn’t believe the second option was unconstitutionally coercive

Congress might attempt to implement a federal exchange program through the states, thus taking advantage of the insurance regulation institutions and experience of the states. In doing so, it would need to be mindful of the limitations the Constitution places on the power of the federal government to control the states. The Constitution has been interpreted to preclude Congress from passing laws that “commandeer” the authority of the states for federal regulatory purposes. That is, Congress cannot require the states to participate in a federal insurance exchange program by simple fiat. This limitation, however, would not necessarily block Congress from establishing insurance exchanges. Congress could invite state participation in a federal program, and provide a federal fallback program to administer exchanges in states that refused to establish complying exchanges. Alternatively it could exercise its Constitutional authority to spend money for the public welfare (the “spending power”), either by offering tax subsidies for insurance only in states that complied with federal requirements (as it has done with respect to tax subsidies for health savings accounts) or by offering explicit payments to states that establish exchanges conforming to federal requirements.
As it turned out, the Obamacare Congress used all three mechanisms to force state cooperation. But, again, no one’s being forthcoming about the author(s) of the restrictive subsidy language. Apparently the Obamacare Congress thinks this secret is not the business of the American people.