Quote Originally Posted by ladyhk13 View Post
I'm confused...so delaying Ocare would make rates skyrocket right? From almost everything I have heard most peoples rates have already skyrocketed. So what am I missing? My sister works for the county school system and as soon as the law was passed they all got called in and were told that their rates were tripling due to it. The rates have actually been increasing for the past three years in preparation for the law but the major hit is coming now with huge deductibles which I think may be very hard on families to budget for.
You have not seen anything yet. The people who designed this either designed it to fail or know nothing about economics, I tend towards the latter because everything I see passed through congress appears to ignore the reality of economics (economics in my mind being the study of human economic behavior)

1. I think some rather naive people believed that when young people might pay 100/mo for healthcare and old people were paying 800/mo enacting a law that limited old people premiums to no more than three time young people premiums would decrease old people premiums to 300/mo, while people with a clue realized this would result in young people premiums going up to 266/mo (800/3).

2. Insurance companies have lost their incentive to be efficient, since no more than 15% of premiums can cover administrative expenses and profits. If I can only keep 15% of what I charge, my incentive is to charge more and increase the amount spent on healthcare, not to be innovative and rein in healthcare costs. I need healthcare costs to increase so that my 15% increases, I cannot reduce healthcare costs and make more money, because if I reduce the 85%, I reduce the total and my 15% as well.

The whole thing is a clust3rfu*k of horrible economic policy. However... we now know that young people are not enrolling at the predicted rate... so the risk pool is skewed even more to old sick people... and since old sick people can pay no more than 3x young healthy people, next year the rates will have to escalate, followed by more young healthy people dropping out, and rates escalating again.. this is what the delay people worry about, if we let young healthy peopl voluntarily sit out without penalty the rates will escalate and quickly. I don't think that is going to be a problem, the penalty is already vastly cheaper than the insurance, so the people will sit out anyway, the concern is unfounded. The rates are already too high and the damage is done.

You are right, the skyrocketing has begun.. but just wait, the real fun is yet to come.