ObamaCare Exchanges Designed To Fail

10/02/2013 11:45

by Judy Kent


Washington, DC - "Yesterday begins the unfolding of another ObamaCare failure," says Dr. David Hogberg of the opening day of the ObamaCare exchanges.

"ObamaCare will invariably lead to a centralized, rigid health care system that will insert the government as the decision maker and destroy the traditional doctor-patient relationship. Cost control will become the driving force. There will be a transfer of wealth -- not from rich to poor, but away from the middle class. They will become dependent on the government," said Project 21’s Dr. Elaina George , an award-winning, board-certified practicing otolaryngologist. "People will find themselves in the unenviable position of not being able to afford medications, tests or procedures because they cannot afford to pay their portion. Even though no one can be turned away for preexisting conditions, they can still effectively be priced out of care because the premiums and the out-of-pocket expenses are too high."

President Obama pushed back the mandate for employers past the 2014 federal elections by. Conservatives have suggested a similar postponement of the individual mandate, but President Obama is willing to shut down the government to prevent this.

"It's laughable that ObamaCare proponents are now arguing that the fact that it is a law means that it is sacred and cannot be repealed. Really? I'm sure glad my ancestors and others fought and died to repeal bad laws so that I can live free today," said Project 21’s Christopher Arps. "There's at least one liberal senator willing to say that ObamaCare is a looming disaster, so there's likely others who have been waiting for someone to go first. For instance, a huge divide exists between organized labor and the White House right now. How can principled liberal senators -- especially those who are also in more conservative states -- sit idly by while ObamaCare destroys the 40-hour workweek?"

A recent USA Today/Pew poll found that 53 percent of those Americans surveyed disapproved of ObamaCare. A similar 53 percent also said they disapproved of the way the Obama Administration is handling health care policy.

"Promise after promise was made by President Obama and this administration in order to get the monstrosity that is ObamaCare passed. Now that it is the law, we see that Nancy Pelosi was absolutely correct when she said we'd really get to see what was in the bill once we passed it," said Project 21 Co-Chairman Horace Cooper , a former leadership staffer in the U.S. House of Representatives. "This law will lower the quality of care for many Americans who already have health insurance, and it will lead to significant increases in the cost of the care they get in the future. It is likely to continue exacerbating the elevated unemployment among 18 - 30 year olds and place a further drag on the economy. Government-run health care has always been a bad idea. The execrable version that progressives imposed on America in 2010 is beyond awful."


Hogberg has written two recent policy studies about the exchanges.

The first, entitled "Why The 'Young Invincibles' Won't Participate In The ObamaCare Exchanges And Why It Matters," examines the financial incentives those ages 18-34 have to avoid buying insurance on the exchanges. Hogberg calculates that over 3.7 million single 18-to-34-year olds would save at least $500 by forgoing insurance and paying the individual mandate fine.

The second, co-written with Sean Parnell, entitled "ObamaCare Exchanges: Just Because You Are Eligible For a Subsidy Doesn't Mean You Will Qualify For One," examines whether those age 18-34 will be eligible for exchange subsidies. Although people making under 400 percent of the federal poverty level ($45,960) are eligible for a subsidy on the exchange, Hogberg and Parnell found that in most exchanges the subsidies disappear before those age 18-34 even reach 300 percent FPL ($34,500).

Dr. Hogberg's studies have recently been cited in USA Today, Investor's Business Daily, The Daily Caller, the Des Moines Register, The Washington Free Beacon, The Weekly Standard , The Colorado Springs Gazette, and The Motley Fool, among many others.

He was interviewed on FoxNews Channel's "Special Report" on September 30 and has been a guest on countless radio programs about his work on the exchanges.

"The exchanges are going to end up in a 'death spiral,'" explains Hogberg. "Not enough young and healthy will sign up, leaving the insurance pool older and sicker. That will cause prices to rise, more young and healthy will drop out, and pool become older and sicker still, causing prices to rise. This process repeats itself until you have an insurance pool that is very expensive to cover and prices that largely appeal to those who are older and sicker."

Today the American Spectator is scheduled to publish an article by Hogberg examining what impact the "glitches" in the ObamaCare exchanges' websites may have. According to Hogberg:

"Among those eligible for the exchange, those ages 18-34 are probably the most web savvy. Thus, they are the most likely to be accustomed the convenience of websites like Amazon.com. Their patience for the exchanges will quickly run thin should they log on to the exchange websites and find it difficult to learn the price of their insurance, to find out how much in subsidies they qualify for (if any), and to enroll. Such frustration will make it less likely they will sign up.

"On the flip side, who is most likely to endure the difficulties of exchange websites? If the exchange website initially prove unworkable, who is most likely to return weeks or months later when the websites may be functional? They will be the people who see the most benefit in having insurance -- namely, those with health problems. The technology glitches add to the exchanges' system of incentives that discourage young and health people and make buying insurance appealing largely to those with high health care costs."



David Hogberg, Ph.D., is a health care policy analyst for the National Center for Public Policy Research. Previously, Dr. Hogberg was a Washington Correspondent for Investor's Business Daily, specializing in health care and Medicare. Prior to his employment at IBD, he worked as a policy analyst studying health care and other issues for various think-tanks, including the National Center for Public Policy Research, and for the office of U.S. Representative Jeff Fortenberry. Dr. Hogberg holds a Ph.D. in political science from the University of Iowa. He is currently working on a book entitled "Medicare's Victims: How The U.S. Government's Largest Health Care System Harms Patients And Impairs Physicians."