Obamacare for the Regular Guy

As an average citizen, I see the benefits of Obamacare for millions of Americans. The initial benefits are mainly for those who cannot afford to buy health insurance, and also those who are rejected by insurance companies due to pre-existing health conditions. Furthermore, you can now compare and choose online the insurance plan you want to buy, which was not available to the public before.

When the new law takes effect on 1st January 2014, insurance companies are forbidden to reject any person because of age or pre-existing conditions. For low income families, the government will subsidize their purchase of health insurance according to their incomes as reported in US income tax. You can register now and find out how much subsidy you’ll be getting by accessing http://www.healthcare.gov.

This health care reform law (originally named the Affordable Care Act) is a comprehensive package passed by the US Congress in March 2010. It addresses two basic problems: the high cost of health care and the access to health care. Both are interrelated as explained later.

Due to the existing complexity of the US health care system, any comprehensive overhaul must necessarily be complicated. As a result, the public is confused. Those who don’t like this law are trying their best to shoot it down. Let me give you just four simple facts:

First, the new law does not provide insurance for illegal residents estimated at 11 million. It only helps the 45 million citizens and legal immigrants who currently don’t have health insurance.

Second, if you are currently insured, the new law does not affect you. So you don’t have to do or worry about anything.

Third, if you cannot afford insurance or are rejected for pre-existing conditions, you should go to the website mentioned earlier to register and seek help.

Fourth, if you don’t want to buy health insurance because you think you are healthy, the new law will penalize you and force you to buy.

The last fact is a controversial one. However, the US Supreme Court has already ruled that it is legal for the government to force people to buy health insurance, because it can be considered a tax, not an infringement of freedom. Besides health care, another existing law requires every driver to buy car insurance, but has met with little opposition.

Obamacare was a major issue in last year’s presidential election. After Obama was reelected, the issue should have been settled in the ballot box. Unwilling to concede defeat, the Republicans in the US Congress have voted to defund Obamacare as a condition for passing the US budget, thus holding the entire US economy hostage. They don’t have enough votes to pass the bill, but the US economy will suffer as a result of the budget fight and all the uncertainties entailed.

There are very good reasons why everybody should get health insurance. Suppose you have a traffic accident and need emergency treatment. The hospital cannot refuse to treat you and let you die in the street because you don’t have health insurance. What will happen if the treatment costs a large sum of money that you cannot pay? Should they take away your home and other possessions in lieu of payment? Should the hospital or the government pay for you? Having a health insurance will neatly solve this problem.

A second reason is the nature of the insurance business. Insurance is all about the large majority subsidizing the small minority who happen to be unlucky sometimes. Since you don’t know when bad luck will strike, it pays to have insurance for peace of mind. This also applies to everybody else.

A third reason relates to the size of the insurance market. The insurance market has to be big in order to be viable. If the market is shrinking, the insurance industry cannot survive. When healthy people take a chance not to buy health insurance, the insurance industry will be left with sick and older people who incur high health care costs. This will force them to raise premiums which will make more people drop out. The downward spiral continues unless the whole society participates. That is why the hospitals and the insurance industry support Obamacare. They want the government to force and subsidize the 45 million uninsured to bring them into the market.

Health care cost is a very complex issue that is beyond the scope of this essay. If you appreciate what I said earlier about the importance of market size, you will agree that full public participation is necessary to bring down the health insurance premiums. The simple fact is that when everybody chips in, we all will pay less in insurance premiums because we support each other. When many people are left out, we will have to pay more. This is the reason why bringing in the 45 million uninsured makes sense both morally and businesswise.

October 2013

This entry was posted in 21st Century, Economics/Politics, Health Care. Bookmark the permalink.

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