Obamacare Is Going To Screw Us All
Tuesday, March 30, 2010 at 3:01PM (FLP Opinion) - It is beginning to appear that Democrats may have intentionally created an unsustainable system for private insurance companies.
The reason? The penalties for not purchasing Obamacare are weak and devoid of serious enforcement provisions. For example, the IRS is the collection agency for Obamacare, but they are only able to fine individuals who fail to pay. The law states that the IRS cannot place liens or seizures on individuals to help collect monies due them. They can't even charge interest on past due amounts. In fact, they can only deduct the fine from a refund due to an individual. With this being the case, many people will simply adjust their withholding to eliminate the possibility of them receiving a refund at all.
Additionally, if everyone isn't forced to buy insurance, people can wait until they face a medical calamity and then purchase coverage at that point. It's clearly gaming the system, but it sure seems like an easy system to game. There is simply a disincentive for the young and healthy to pay into the system before they become seriously ill.
One thing clear, if the young and healthy decide to wait and pay the fine instead of signing up for health care, private insurance costs will skyrocket and the system will likely breakdown.
But isn't that what they always want anyway?
Reader Comments (5)
Good points FLPundit. "Gaming" the system will be rampant. If health insurance was a priority for Gen X's etc. they would have purchased it. Instead there are addictions to the "good life" (iPods, cell phones, cable TV, unaffordable mortgages, etc.) and there won't be any money allocated to enroll in health insurance plans, even when required by the government. (I"ve heard the statistic that 30% of drivers don't carry insurance even when it is a state law because the penalties aren't severe enough.) They'll dodge the tax "fee" and probably 90% or more will get away with it. The shortfall will be the "can kicked down the road".
And you conclusion that this is what was the desired result couldn't have been more accurate.
In a few years time, health insurance will have gone the way of the typewriter; it will be extinct. With Obama footing the bill for our every medical cost, who will need it? If I were working in the medical insurance industry, I would be spending a lot of time on Monster.com these days.
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I think the penalty is $750 for the first year, which is $73.33 per month to not have to buy health insurance. Versus $500-600 per month or whatever the premium will be for an individual. How many uninsured will go for that deal? Only the ones whose income is low enough that they qualify to have their health insurance premium paid for by the gubmint.
ChrisP, you make a very good point. That is our future reality. No doubt about it.