Obamacare Hurting Those It Means to Help

December 19, 2013 - 9:53 AM

We've all heard the Obamacare horror stories: members of the individual insurance marketplace who watched their plans get canceled; business owners watching their costs rise; and employees finding out that more is coming out of their paychecks for approximately the same benefits.

But the underlying logic of Obamacare was that those in need would benefit from the rest of us suffering. As Jonathan Cohn of the New Republic wrote back in November, "a system that discriminates against some people inevitably discriminates in favor of others."

As with virtually all government programs, however, it now appears that Obamacare is hurting precisely those it is designed to help.

Let's begin with the poor and the elderly. Many poor Americans receive Medicaid, a program designed to help them pay for their health care costs. A little-known provision of Medicaid requires the government to recoup certain costs from the estates of those who benefit from Medicaid. Typically, this means covering nursing home and long-term care, since those on Medicaid have little by way of assets. Low-income adults with assets were able, up until Obamacare, to qualify for subsidies for their health insurance outside Medicare.

But thanks to the expansion of Obamacare, low-income adults with assets are now forced into Medicaid so long as they qualify. This means that elderly folks who have assets must now pay into a system that will rob them blind upon their deaths. States like Oregon and Washington are already looking into fixes for the situation, but meanwhile, low-income seniors with assets face the possibility of losing everything by joining up.

Then there are poor people of minority ethnicity. According to the Kaiser Family Foundation, almost 5 million poor, uninsured adults will lack subsidized health insurance under Obamacare in 2014. This is because the federal government attempted to cram down Medicaid expansion on the states, and many states refused, thereby leaving millions in the so-called coverage gap. Kaiser Family Foundation wants Republican governors to expand Medicaid, despite the fact the federal government would essentially put state governments on the hook to pay for its expansion.

In the meantime, if availability of health care is the issue, Obamacare creates more problems than it solves by driving physicians out of the business. The only way to make cheap products available in any industry is to up the supply. Obamacare artificially depresses the supply of medical professionals by placing new restrictions on doctors without doing anything about their medical liability problems. Polls show up to 60 percent of doctors saying they would consider quitting their practices.

My wife, who attends UCLA Medical School, said that her classmates are increasingly leaning toward specialization in fields not affected by Obamacare (read: dermatology) and away from primary care. Many are already considering concierge care.

In the end, Obamacare will be deemed a failure because as with all redistributionist programs, it makes virtually everyone worse off. The biggest problem with Obamacare, however, is that when we're talking health, worse off could mean dead.