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Down With The Sickness

When Massachusetts' universal health care plan was being set up, a lot of us critics made many dire predictions. The plan would drive insurance companies out of business or out of state, employers would run the numbers and simply drop their coverage, doctors would retire or leave the state, and so on. At the time, we were dismissed as cynics and partisan hacks; the plan might have some flaws, but it would be a vast tremendous improvement. Those predictions of doom and gloom? Lies, all lies.

Then, the absolutely unexpected happened. Things that no one could have seen coming. First up, doctors started getting scarce in the Bay State. Turns out that the retirement rate spiked, coinciding with a sharp increase of doctors moving their practice out of state.

Next, insurance companies started filing for increased premiums. It seems that quite a few of them were losing money under the state's policies and payment rates. The state turned down most of those increases, and several insurance companies started making noises about leaving the state altogether. Again, absolutely unexpected and utterly unforeseeable.

And today, there's news that almost a hundred Massachusetts employers have run the numbers and, gosh, it would be a lot cheaper for them to drop their employees' health insurance and just pay the fine.

Let's say that Company X currently pays $10,000 a year for employee health insurance. Their accountant is doing their taxes, and finds a line that says "prove you offer your employees health insurance, or pay a $5,000 fine." How tough a choice is that to make?

In the end, businesses exist to make their owners money. Period. To do so, they offer goods and services to people and do what they can to win business, but it's almost never done out of altruism. It's self-interest. And the best self-interest is enlightened self-interest; it's what keeps most businesses relatively honest. The decision-makers are usually smart enough to realize that pulling scams and frauds get you short-term gain, but cost far more in the long run.

When a company does something that seems fiscally stupid, there is almost always another factor that outweighs profit. Factors such as government intervention or an overemphasis on ideology, just to name two.

"Do this simply because it's the nice thing to do, even though it will cost you a hell of a lot more money" almost doesn't cut it. That's because those pushing the altruistic move are typical liberals; they're exceptionally generous with other people's money. They can give you all kinds of reasons why you should spend YOUR money for THEIR pet causes.

So, what will be the next disaster to befall the Bay State thanks to their universal health coverage? I'm gonna go out on a limb and say the state will start piling up record budget deficits as they shovel more and more money down the rathole, and the billions in state subsidies that have been shoring up the program start to run dry.

Whoops, too late...

Just remember: the Massachusetts plan was one of the key influences on ObamaCare, people...


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Comments (9)

I believe as well that libe... (Below threshold)
DaveD:

I believe as well that liberals tend to be very generous with other folks money. However, Mitt Romney played a major role in devising this plan and and it has become a very expensive experiment even though many of its problems could be anticipated. Universal healthcare Massachusetts-style is the main reason I could not (at this time anyway) be enthusiastic about Mitt Romney's candidacy for president. For someone who is touted as having a keen understanding of business/economics I don't get how he could have been a major force behind this plan. It will always be up to the public to decide what the long term implications are of legislation. The politicians are not going to do it or acknowledge it.

Let's say that Com... (Below threshold)
iwogisdead:
Let's say that Company X currently pays $10,000 a year for employee health insurance. Their accountant is doing their taxes, and finds a line that says "prove you offer your employees health insurance, or pay a $5,000 fine." How tough a choice is that to make?

And what are the chances that this isn't a primary goal of Obamacare? The libs understand that employer-provided healthcare and private insurance must be eliminated in order to shove single-payer horror down our throats. Every customer taken out of private insurance and dumped into the government option reduces profitability and market power of private insurance. Pretty soon, private insurance as we understand it will be a thing of the past and we'll all get to experience Cuban-style healthcare.

Hold on, folks. We ain't seen nothing yet.

This is Romney's legacy whi... (Below threshold)
TexBob:

This is Romney's legacy which hang around his neck like a dead albatross.

No one is going to vote for a guy with slick hair who smells of death for president.

Yeppers, Romney Care is set... (Below threshold)
Gmac:

Yeppers, Romney Care is set to kill any semblance of rational health care in the state that firmly believes in spending 'other people's money'.

Funny thing is that as the tax rate increases to confiscatory levels people that have the ability will leave, just like the doctors and insurance companies did.

Two things will remain, a non taxpaying group of benefit recipients and the politicians they elected. Who is going to pay for their failure remains to be seen but I can safely predict that isn't going to be anyone in MA.

I wouldn't trust anyone fro... (Below threshold)
GarandFan:

I wouldn't trust anyone from Massachusetts when it comes to 'cost estimates', especially after Splash Kennedy's estimate for the 'Big Dig'.

But you forget folks, ObamaCare was DESIGNED to fail. That way the libs can move right on in to 'single payer', which is what they wanted from Day One.

"Do this simply be... (Below threshold)
JSchuler:
"Do this simply because it's the nice thing to do, even though it will cost you a hell of a lot more money" almost doesn't cut it.
Actually, it kinda does cut it, but that's not what's going on here. It's "If you don't keep doing this nice thing that you are currently doing (and spend additional resources to prove to us that you are doing so), we'll fine you."

Now, that fine would seem like a disincentive to drop coverage, but what it actually does is make it morally acceptable to drop coverage. After all, even if you are no longer directly providing health care coverage for your employees, you're still paying "your fair share," as determined by government.

GerandFan is right. ObamaCare is designed to fail. There is no reason why, in a country where employers long ago stepped up to provide health insurance to their employees, government needed to mandate employee coverage. This mechanism where fees and fines serve as a kind of absolution for what would otherwise be seen as a moral failing is known well enough for me to think it intentional.

Massachusetts has it's hand... (Below threshold)
GarandFan:

Massachusetts has it's hand out for more "Stimulus". It's not for the economy, it's to prop up their health care program.

Hawaii found the same thing with their experiment in health care. Made it so affordable that people dropped their own coverage and went for state coverage. The program quickly ran out of money. Go figure. Now they've got to prop the program up with funds taken from elsewhere. Soon they'll be raising taxes so that 'they don't have to lay off teachers and cops'. After all, "It's for the children!".

Health care costs keep rising because:
1) We want the "best" and newest treatments
2) Employers foot most of the medical bill
3) There is NO true competition

During WWII, the Feds mandated price and wage controls. Companies were vying for government contracts and once secured, needed workers. Since the government mandated wages, the only sugar employers could offer was in the area of paid medical care. This continued after the war.

The 'most expensive' health care might not be 'the best' for each and every circumstance. Unfortunately, the decision maker is usually the employee. If they were only guaranteed X amount of medical bucks each year, they might reconsider their choices.

Insurance companies should be allowed to compete across state lines instead of the ridiculous government imposed borders that now exist. Libs have no problems with ILLEGAL WORKERS. Maybe it's time for ILLEGAL INSURANCE COMPANIES.

People with a CHOICE in the market place can usually be counted on to look for the best option at the best price. BECAUSE THEY HAVE A STAKE IN THE OUTCOME.

The only stake a bureaucrat has is to make sure all the form boxes are filled out correctly.

In years past, companies granted x amount of 'sick time' and 'vacation time' each year. Over time, they noted that employees "got sick" in direct proportion to the amount of time allocated. Today companies offer a combo 'sick/cavation time' package. Get sick as often as you want.....the rest can go to your paid vacation. Evidently this was the best medical advancement in years. Employees suddenly got "LESS SICK".

Who'd have ever thought that people are guided by self-interest.

We need a 95% income and we... (Below threshold)
TexBob:

We need a 95% income and wealth tax on politicians at the state and federal level.

They can qualify for deductions based on how much money they save normal taxpayers.

The numbers I've seen from ... (Below threshold)
John S:

The numbers I've seen from Massachusetts are far more dramatic than your hypothetical example. A company with 13 employees is paying $120,000 year to provide health insurance (and that's going up 17 to 18 percent a year). The annual fine to drop the benefit is $6,000. It's the difference between remaining in business and bankruptcy. And what can the employees do? If they quit there are 10 people waiting to take their place. If it's minimum wage and 40 hours a week, there are 100 people that will immediately take the job.




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