Mona Charen: Don’t let Obamacare crisis go to waste
By Mona Charen
The constipated debut of Obamacare has reduced the president of the United States to the status of TV pitchman. “Act now” to get this great product, he exhorted listeners on Monday, offering testimonials from one of the rare successful purchasers, promising limitless benefits and low prices, and even an 800 number. His operators are standing by, he urged, and they speak 150 languages! (You could sign up in Min Bei and Kazakh, if you could sign up at all.) If Obama had thrown in a free tote bag for the first 100 callers, it wouldn’t have seemed out of place.
The president has consistently claimed that his law will extend coverage to the roughly 47 million uninsured (there is no agreed upon number) while also reducing premiums for everyone. This is like promising that you can eat all you want and still lose weight, which other TV pitchmen routinely promise come to think of it. This is not possible. For the law to work even reasonably according to plan, say, with only small increases in premiums for everyone, large numbers of the young and healthy who have previously gone without health insurance must sign up.
That’s why it was a little odd that the president kept referring to those with pre-existing conditions at his Rose Garden appearance. He doesn’t need to persuade them. The sick and uninsured have the strongest incentive to weather the failures, frustrations and long wait times on HealthCare.gov. It’s those who are being asked to purchase a product they don’t think they need — the young and healthy — who will be deterred by the crashing website. After the second or third abortive attempt, to say nothing of the 30th, they are likely to choose to pay the fine rather than sign up, particularly since the fine, at least in 2014, is low.
The fines rise steeply in 2015 and beyond though, which may force the young to confront the fact that they were promised a shiny new benefit — free healthcare — and are actually just transferring wealth (again) to others. They may not have recognized it when they pulled the lever for Obama in 2012 but young people were voting to tax themselves even more for the benefit of those who are already better off than they.
The average net worth for households headed by someone 65 or older was $170,494 in 2011, compared with $3,662 for those headed by someone 35 or younger. While it’s always been true that the elderly are wealthier than younger people because they’ve accumulated assets over the course of their lives, paid off their mortgages and so forth, the gap between generations is now at its highest point ever.
Young people are already burdened. They are struggling to find full-time jobs, paying off student loans and raising children. Often, they are helping to care for their aging parents. Their paychecks are already docked for Social Security and Medicare, and now their health care premiums and/or deductibles will rise as well. Many of the benefits (if we ever get that far) will flow to those close to retirement.
This assumes that Obamacare will survive the next several months. If the website is not repaired soon, as Yuval Levin explained in National Review, the health insurance “death spiral” will result in larger numbers of sick than well subscribers. Insurers will be forced to raise premiums, which will, in turn, drive out even more healthy people, leading to higher premiums and then to insolvency.
Some on the right, foreseeing the failure of Obamacare, have argued that it was all part of a diabolical plan by the Democrats to achieve what they’ve always really wanted — single-payer.
It’s true that single-payer is their goal, but after witnessing the debacle of Obamacare, will voters be willing to trust the Democrats when they say, “And now for another huge new entitlement program. Motto: This time, it won’t crash”?
Rather than engaging in purification rituals among themselves, Republicans’ most crucial job in the coming months is to present a coherent alternative to Obamacare — one that deals with the problem of pre-existing conditions, increases competition, encourages personal responsibility (by, for example, permitting lower premiums for those with healthy habits), and cuts through the Gordian knot of health care regulation.
Let’s adopt Rahm Emanuel’s thinking and not allow the Obamacare crisis to go to waste.