November 4, 2013

AMERICANS FINDING OUT THEY WERE SOLD A LEMON:

There’s a reason that unions fight so hard to keep their gold-plated insurance, even making significant salary concessions to do so, and that’s because their members really want low-deductible insurance.

U.S. cost-sharing is actually low, by international standards; just 23 percent of our private health spending comes from out-of-pocket expenditures by the consumers of health care. We like being insulated from costs, and we’re rich enough to demand it. Assuming that the Cadillac tax goes into effect (though I’m still sort of skeptical), a whole lot of those in the 80 percent category are going to lose a plan they liked because the government made it too expensive for companies to keep delivering it. Yes, of course, companies already cancel plans quite frequently. But these cancellations are going to happen all at once, because the law demanded it.

Moreover, the people who end up in those plans won’t just be choosing them as the cost of other plans goes up; they’ll be forced into them because the other plans aren’t offered at all. They are going to be screaming mad, and Democrats should not delude themselves that they will be soothed by all the marvelous things that may then be happening in the individual market. That’s why I still think there is a good chance that this gets rolled back before it goes into effect — but that is going to create its own, not insubstantial, budget problem: The Cadillac tax is supposed to raise about $80 billion by 2023.

And this just looks at price, not things such as provider networks, which is going to bring on a long and lasting wave of public outrage starting sometime around March of next year.

It’s like some sort of train wreck or something. Hey, maybe if someone had actually read the bill before it was passed . . . .

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