Ever heard a doctor talk about the value of “early detection” with certain medical conditions? The idea, of course, is to catch a disorder before it progresses too far and serious symptoms start to show. That’s when it’s harder to cure.
Well, consider this an early-detection warning for a piece of legislation that became law one year ago - the Patient Protection and Affordable Care Act, or “Obamacare.”
Many of its most troubling provisions haven’t taken effect. Indeed, it’s in legal limbo, having been declared unconstitutional by a federal district judge in a lawsuit brought by no fewer than 26 states. But some portions of the law are now active. And as Heritage Foundation health care expert Brian Blase points out in a new research paper, they’re beginning to inflict harm.
Start with perhaps the most famous of the president’s claims about his health care “reform” - that if you were happy with your insurance, you didn’t have to worry; you could keep it. It would be “grandfathered in” and thus not subject to the law’s myriad new regulations and requirements.
But that’s not how it’s working out. Health plans can be grandfathered in, all right, but only if they meet a variety of requirements. That’s not what Americans were promised. Plus, plans can lose their grandfathered status for making changes that aren’t deemed “reasonable” by the expanding federal bureaucracy.
The Obama administration itself has estimated that 49 percent to 80 percent of small-employer plans, 34 percent to 67 percent of large-employer plans and 40 percent to 67 percent of individual insurance coverage won’t be grandfathered in by the end of 2013. If you like your health plan, well - sorry, but the odds are not in favor of you getting to keep it.
Take another provision that may sound good at first: Under Obamacare, health plans must spend a certain percentage of the premiums they receive paying claims and making quality improvements - at least 85 percent for large-group plans and 80 percent for plans in individual and small-group markets. Otherwise, they have to rebate the difference to their members.
A year later, what do we find? Numerous insurance companies leaving the market altogether, giving all of us fewer choices to pick from. One such company, Principal Financial Group, provided insurance to more 800,000 people. As Joshua Raskin, an analyst at Barclays Capital, has noted, it “is harder and harder for smaller plans to compete in a more regulated environment.”
Then there are mandates Obamacare places on insurance plans. For example, Mr. Blase writes, “No insurance plan can now limit lifetime benefits, and group plans cannot have annual benefit limits.” The all-too-predictable result? Significantly higher premiums. According to Regence BlueCross BlueShield of Oregon, 3.4 percentage points of its recent 17.1 percent rate increase is due to Obamacare. Celtic Insurance Company in Wisconsin and North Carolina blames the law for half of its 18 percent rate increase.
And this is only the beginning. Many more regulations are to come. Yet even administration officials, at this early date, can’t keep up with it all. They’ve issued more than 1,000 waivers to exempt companies trying their best to cooperate with this legislative octopus.
As I’ve pointed out before, fixing the law isn’t an option. Market-based health care reform simply can’t be reconciled with Obamacare, which is a massive system of central planning. We need health care reform, to be sure, but it needs to be based on personal choice and free markets.
That can’t be done until members of Congress swallow what some may find to be a bitter pill: the repeal of Obamacare. If not, next year’s diagnosis is sure to be worse.
Ed Feulner is president of the Heritage Foundation (heritage.org).