So the Baucus bill has just passed out of Committee, which means that America is one step closer to eliminating the problem of having people without insurance. Ha! Wrong — as Dick Morris describes in this article, under the new rules many Americans will realize that it makes absolutely no financial sense for them to obtain insurance:
Will a young, healthy, childless individual or couple buy health insurance costing 7.5 percent of their income, as required by Obama’s health legislation? Not until they get sick. Then they can always buy the insurance, and the Obama bill requires the insurance companies to give it to them. And if the premiums come to more than 7.5 percent of their income because they are now sick, no problem. Obama will subsidize it.
Instead, young, healthy, childless people will likely opt to pay the $1,000 fine (aka slap on the wrist) mandated in the bill. After all, even if they make as little as $50,000 a year, the fine is a lot cheaper than 7.5 percent of their income (or $3,500 a year)!
So … these young households will not contribute to the coffers of any health insurance company until they are sick and need the coverage. By then, their costs will come to vastly more than their premiums.
Who will subsidize the difference? We will.
As Democrats try to come together around a final bill, they’ll be grappling with issues like this: how high can we sent the fine to try to force healthy people to buy relatively expensive insurance before we look like government monsters by fining those with modest incomes? The problem of course is that the government wants to provide some people with a lot of new benefits but has to pass the costs on to someone–and it is going to try as hard as possible to make it difficult to figure out exactly who is going to be hit with the bill.
But even if the details of what these health bills contain are hard to decipher, the public can count on a few absolutes: you can’t get something for nothing, so if we are really going to expand coverage to include millions of the previously uninsured, costs are going to go up. Those costs will be born by all of us through higher taxes and higher premiums. And government programs always cost more than policymakers estimate, so we are all going to be paying a lot more if one of these bills becomes law.