Massachusetts' Warning Signs for Obamacare

Massachusetts' Warning Signs for Obamacare
February 14, 2013

Benjamin Domenech

Benjamin Domenech (bdomenech@heartland.org) is a senior fellow at The Heartland Institute. Domenech... (read full bio)

Josh Archambault writes on the latest details from Massachusetts concerning Romneycare's impact.

“We have seen an uptick in the number of uninsured, 3.1% in 2011 when compared to 1.9% in 2010.” The newly covered are overwhelmingly subsidized in whole or in part by the taxpayers: “Many of the coverage gains have come in Medicare and Medicaid. Over 40% of the state budget is now spent on Medicaid, and once the ACA is implemented 25% of the Massachusetts population will be on this broken public program.” 

He also notes lower take up rates, likely driven by more part-timers:

“67% of employees took their employers’ offer of insurance in 2001, 63% in 2003, and now it is down to 50% in 2011… I find it hard to believe that waiting periods account for this decrease, especially since it is temporary, but I do wonder if employers are increasingly moving their employees towards part-time work.” 

And as for lowering premium costs, a picture says it all.
 
As Walter Russell Mead notes, the uptick in uninsured is a sign people are figuring out the system, as they will nationally.  

“This means that for a lot of people paying the tax will be cheaper than buying insurance. And since the new law prevents insurance companies from denying you coverage or charging you more if you have a pre-existing condition, you can always buy a plan later if you develop an expensive medical condition. Over time, more and more people are going to figure this out. Many healthy people (especially the young and the single) will just pay the tax, knowing they can get it later if they need to. In the meantime, everybody with expensive health care problems will flood into the system, driving up costs and premiums. Then even more healthy people will choose the tax over the increasingly expensive insurance premiums, in turn forcing premiums up even higher.”

Taken together, these are not positive signs for Obamacare.

Benjamin Domenech

Benjamin Domenech (bdomenech@heartland.org) is a senior fellow at The Heartland Institute. Domenech... (read full bio)