Obamacare vs. Reality

We might take a moment to contemplate where the Affordable Care Act would now be if its major programs were to be held to actual financial sustainability before they could be implemented.

In fact, one key program of Obamacare collapsed nearly two years ago. President Barack Obama approved an addition by Congress to the legislation — the CLASS program, providing long-term care for the elderly (such as nursing homes).
Unusually, however, Congress stipulated that the secretary of Health and Human Services (HHS) must certify that the program be financially sustainable. It wasn’t even close, and in October 2011, Secretary Kathleen Sebelius told Congress it could never happen.

On April 25, Secretary Sebelius testified before the House Budget Committee that the Independent Payment Advisory Board (IPAB) — the 15 members to be the keystone of “affordability” in the Affordable Care Act — had not yet been nominated, and would not be, for the foreseeable future. She reported no “recommendation would be targeted until 2019 anyway.”

Secretary Sebelius did not lament that nominations to the board had been rejected by Congress. The law mandates that nominations would be made and sent to the Senate in 2012 and that IPAB would be functioning by May 2013. But no members were ever nominated. Not one.

She did not seem too broken up about this. Perhaps that is because Obamacare provides that if IPAB is not functioning, all of its powers devolve to the secretary of Health and Human Services.

The supposedly vital function of IPAB is to control spending by disapproval of any medical procedures, medications or treatments it determines unnecessary or too expensive. (Why replace a hip of anyone over age 85?)

Will Kathleen Sebelius make those decisions herself? Is Obamacare financially sustainable without its Independent Payment Advisory Board?

We can hope that rapidly escalating costs will not be a problem before 2019. Or schedule our hip replacements before then.

The financial salvation of Obamacare has come to rest on its power to force all Americans to obey the mandate to buy health insurance. In this case, the promise of affordability is based on the idea that, for the first time in the history of civilization, the price of something can be reduced by forcing everyone to buy it. This will be achieved by forbidding anyone to directly contact a health insurance company to buy a policy, and by requiring them to choose a policy from a government-run insurance “exchange.”

This will save a lot, we are told, because everyone must buy a policy that includes coverage for a list of services as decreed by HHS, in addition to coverage for all the services required by each state. Whether you want it or not. Whether you can afford it or not. You may not avoid this by purchasing insurance from a company in another state (which is forbidden everywhere but Georgia).

These are just the most obvious consequences of Obamacare, which suffers from more than financial unsustainability.

Employers with full-time employees will cut the size of their staff or reduce employee hours to avoid rising costs. Employers and individuals will choose to pay fines to avoid the much-higher costs of mandated insurance. Physicians and hospitals forced to provide services at a reimbursement level below their costs will stop providing those services.

We no longer confront the promise of Obamacare. Obamacare is now forced to confront reality.

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