NEOAVATARA

If there is a plan anywhere in the world that resembles what President Barack Obama and Democrats are trying to do with national health care reform, it is the current universal coverage plan in Massachusetts.

That is not necessarily a good thing. Let us go over the ways that it is similar to Obamacare:

• It mandates universal coverage.
• It gives subsidies to people to afford care.
• It taxes those that don’t buy into the system.
• It has the equivalent of a public option.

Forbes had an excellent piece on the state insurance in Massachusetts, which can be read here.  Erin Burnett of CNBC had a fascinating interview with Massachusetts State Treasurer Timothy Cahill on the status of the Massachusetts health care plan.  I suggest everyone watches it.  Cahill is basically in charge with keeping the program solvent; and he is having great difficulty doing that.

Before health care reform was enacted in Massachusetts, it already had one of the best health care systems in the country.  It had the lowest percentage uninsuredd (around 9%).  It had (and still has) the highest ration of Doctors to patients.  Its wait times to see a physician were the lowest in the country.

All the economists used by Massachusetts predicted that Massachusetts would slow the rate of increase in expenditures for health care.  Well, it hasn’t worked out that way.  Since 2007, the national rate of increase in health expenditures is 18%; for Massachusetts, the rate of increase until 2007 was 23%.  And the tresurer for the state said that by the end of 2009, the totall increase will be 41%…or about two and a half times more than the national rate.  Why is that the case?  Simple:  just like in the Obamacare proposal, there was almost no true price controls, only a shift of spending from employers and individuals to the state.  And of course, more people are eligible, and thus naturally costs will significantly increase.  As the state treasurer says in the interview above, when something is free, it can be very costly.

Now, Massachusetts is far and away the best in the country with universal coverage, with less than 2.6% of people without health insurance.  And remember…those people have to pay a penalty of a $1,000 a year for that privilege.  If there is any success story in this, that is it.  However, one reason for the cost explosion is that people are switching from independent insurers to the public options, a scenario that Republicans have warned about during the national debate.  The state plan is generally cheaper than the independent plans, and thus for the lowest income families, it makes the most sense.  That has always been the Democrats main argument for the public option.  The problem is, that the public option is going bankrupt, and not able to sustain current costs.  It has gotten so bad, Massachusetts is planning to dump immigrants from the program, saving $153 million yearly.  You may say ‘Great!’, except one thing:  These are legal immigrants, green card holders, NOT illegal immigrants.  These are people legally in this country, legally paying taxes, legal residents of both the state of Massachusetts and the United States of America…and they will be treated as second class in Massachusetts.  Not a great advertisement for universal health care.  How much this is going to cost those people is still uncertain.

It is frankly ridiculous for people predicting in the state of Massachusetts to be surprsied by this, and no one on the federal level should be surprised if the same thing happens with their plan.  Like the San Diego Union-Tribune stated:

Now it’s time for a similarly hard look at the other key claim made by advocates of the health overhaul: “If you are happy with your plan, and if you are happy with your doctor, we don’t want you to have to change,” as Obama put it at a recent town hall meeting.

Baloney. Even a cursory look at reform plans confirms they would badly undercut private coverage – coverage most Americans say they are satisfied with.

Consider the much-debated government-sponsored “public option” for insurance coverage that Pelosi demands must be a part of any overhaul. It would allow companies to obtain government-subsidized health coverage at a cost now set at 8 percent of their payroll. This is much less than the current average of 12 percent to 14 percent and thus provides a huge incentive for employers to scrap their present coverage for a government plan of uncertain quality.

And whether or not the public option is dropped, federal regulators inevitably would end up directly controlling the scope of private coverage. Yes, existing plans initially would be treated as if they met federal standards for new plans. But in both the House and Senate versions of the overhaul, existing employer-sponsored coverage would be required to meet these mandates beginning in five years. These standards would require much broader and thus costlier coverage.

Erin Burnett

Defenders of the ‘Public Option‘ cannot hide behind these facts: the Public option will eventually drive people to it, because it simply will cost less up front, and will be able to ration care more freely to reduce costs on the back end.  It is that simple.

Mr. Cahill, the Massachusetts Treasurer, made another interesting comment.  He stated that one of the major problems with the Public option is that it was ‘too cheap’.  In other words, the costs involved should have been higher, which would have deterred more people from joining the government plan.  Additionally, small businesses in the state currently are fined $250 yearly for each person not covered by the business for health care…and Mr. Cahill said that was too low.  In other words, higher fines would be the solution.  Remember that when Democrats talk about mandates…

Another myth by the left is that health care costs will plummet because people now without care will get it through normal means.  That has been proven false.  Initially, the costs involved with this group of people was predicted to drop by 75%.  In reality, the cost has dropped by less than 25%, with predictions of even less cost benefits going forward.  In other words, providing care did not save money for treating the underinsured and uninsured.

Ultimately, all of this doesn’t matter as long as people are happy, right?  Remember, 85% of the American public today has health care insurance, and of those, about 75% are happy with the care they receive.  Pretty solid numbers.

Well, a study by Harvard University has shown that 60% of Massachusetts residents are unhappy with their current health care system.  Only 22% are happy.  Here is a even more remarkable number.  In the lower middle class (those making $25-50,000 a year), the opposition was the highest of any income group.  So, those expected to benefit the most from the plan were actually the most against it.

There is a reason people are angry right now.  When you look at many of the facts, the proposals washing through Congress have failed before. Of course, it is hard to know what is going on when you don’t bother reading the bills.  Many of the same concepts that are intrinsic to the Massachusetts plan is also instrumental to Obamacare: Individual mandate, business mandate, universal coverage with a public option.  People should have the courage to ask a simple question to their representatives in Congress:  If it didn’t work in Massachusetts, why would you bring that type of system to the rest of the country?  Every citizen should ask these questions and demand answers from their representatives.  That is your right and responsibility.