August 23, 2013
WALTER RUSSELL MEAD: Obamacare’s Unintended Effects: Spouses and Children Edition.
Even a well-designed law can have unintended effects that worsen the problems it was meant to solve—and a slipshod law like Obamacare threatens to cause serious damage. UPS, for instance, has decided to stop offering insurance to employee spouses who can get insurance from their own employer.
Stupid, unfeeling for-profit corporations! Oh, wait:
UVA officials announced a similar policy yesterday, also referencing the costs Obamacare will add to the university’s health care budget.
This may not seem like a big deal—either way, the spouses will be insured—but it points to some potential problems. For now, UPS and other companies are continuing to cover unemployed spouses, but given their anxiety about steep costs in the era of Obamacare, they could concievably soon decide to exclude them.
This could put more pressure on the exchanges, ramping up the number of older people receiving subsidized plans in the individual market. But what the exchanges need to work is more “young invincibles”, not more middle-aged spouses kicked off employee plans. And here the incentives seem to be working the opposite way.
It’s as if the whole thing were designed to fail.