market-ticker.org / By Karl Denninger / January 21, 2013, 13:11
I stared at this yesterday when it first hit my screen in disbelief. They actually ran this crap?
While the most sweeping provisions of the health care overhaul have not yet gone into effect, plenty of Americans will still be paying higher insurance premiums this year — as insurance companies try to preemptively cover the cost of a tax increase included in President Obama’s Affordable Care Act.
That tax doesn’t take effect until next year, when other major provisions like the so-called “individual mandate” and insurance subsidies also kick in. But that hasn’t stopped insurance companies from charging higher premiums this year to cover the hike, as well as the cost of ObamaCare benefits such as free birth control and preventive care.
Premiums for individuals and small businesses are projected to increase due to the tax by roughly 2 percent this year and by as much as 3.7 percent in 2023, according to a widely cited analysis by the insurance industry.
2% and 3.7% eh?
I have multiple reports of individual and small-group plan price hikes of 50, 60, 70, even 100% coming down this year and next. Against that 2 or 3.7% is going to sound like a Girl Scout picnic.
The problem is that the “must-issue” and “community rating” provisions in the law are just more cost-shifting and promise to make everyone pay more, because they force everyone to buy — including those who otherwise would not. Since there is no restraint on the services one consumes enforced by the size of your wallet there is no price feedback mechanism on the medical industry.