How Much Does Obamacare Rip Off Young Adults? We Ran The Numbers. | Hacker News Reader

How Much Does Obamacare Rip Off Young Adults? We Ran The Numbers.

forbes.com

14 pointsytNumbers17 comments

I was (am?) a proponent of Obamacare, but I was really taken aback when I got our notification of what my young family's new premiums and plan would be under the ACA. Our premiums are going up 38% and our max-out-of-pocket is doubling. We are also now responsible for 20% of costs after the $3000 deductible instead of 0%.

"Obamacare is asking young adults to effectively subsidize the healthcare costs of older Americans." - so is every other goddamned healthcare system in the world, besides "Devil take the hindmost".

Low risk subsidizes high risk, but someday you will be high risk.

Right, this seems so plainly obvious... It's not as though "young adults" don't age.

You know, it almost sounds like this ACA thing is some sort of insurance.

No, it sounds like it's a welfare program. If it were insurance, it would charge proportional to the expected cost of serving the relevant demographic group. But due to the "community rating" provisions, charging actuarially appropriate rates is illegal, so instead we're charging rates that are pretty much guaranteed to make health care even more expensive than it was before.

I've heard the car insurance analogies which don't work very well. Perhaps a life insurance analogy would work better... Now everyone can apply and get life insurance regardless of preexisting/current conditions. To make it affordable the young and healthy will pay more than the statistical probabilities that they will die tomorrow. The elder will pay less. How is this sustainable except through ever drastically increasing premiums?

Yes, the article conspicuously failed to "run" any "numbers" on this point (or on any point, for that matter). What are the risk profiles among different age groups? What kinds of distributions of risks are there? How did each group fare before and after the reform? What are the average expenses in different demographics and how do they compare to the premiums (in different demographic & income groups)? None of that is here, because this is not an analysis, but the "Forbes blog" formula: linkbait title, no followthrough.

The article doesn't even mention the most obvious change, which is that the big policy change in Obamacare was removing preexisting conditions as a pricing differentiator. That has a fairly complicated set of results, some of which correlate with age, and some of which result in other kinds of pricing changes (such as a transfer from people who did not have major childhood diseases to those who did). How much? The article doesn't investigate, because it did not in fact "run the numbers".

Hopefully those older people are making more income. Should the fraction of your income you spend on insurance increase, decrease, or stay similar as you age?

The rates are quite frankly ridiculous.

I live in BC one of the few provinces in Canada where you actually have to pay for insurance and the top rate for an entire family is, $1662 per year or about $800 for a single person, if you make less than $22K it's free.

(No, we don't pay for it in taxes because we have lower tax rates than the US, and yes, our corporate tax rates are lower too)

PS. As a percentage of GDP the US before ObamaCare and the Bush drug thing spent more money on public healthcare than Canada. Yes, rollback the clock 14 years, and you could have Canada's healthcare system for less than what you were already spending. For what you are currently spending you should have limo drivers pick you up from your home and take you to the doctor.

> No, we don't pay for it in taxes because we have lower tax rates than the US, and yes, our corporate tax rates are lower too

That doesn't follow at all. That could just as easily occur because your government skimps on other things. Do you have a ~$1 trillion/year military? Didn't think so.

I'm not saying one is better than the other, but _someone_ is paying for your health insurance, and its probably some split between taxpayers, doctors, pharmacies, medical research companies, etc.

"How much does _pay as you go social program_ rip off _demographic not currently served by program_? We ran the numbers."

I'm not sure whether to believe TFA, because it conforms so exactly to my initial expectations when I first heard of Obamacare back in 2009. I'm not noted for any skill at predicting outcomes, so this makes me suspicious. If the government wants to transfer (even more) resources from young adult single people to older family-type people, it's going to have to pick a non-voluntary method. ISTM taxes are often used for this. I know the excuse why that didn't happen: that blatant inter-generational transfers wouldn't have passed the legislative process, while this Byzantine obfuscated rat's nest for which dozens of parties can plausibly be blamed did. Maybe that's a problem?

Great you pointed out healthcare is hard to solve. How do you fix it? ignoring it is not a good solution.

I dunno, maybe ask, every other developed country in the world?

Maybe after the US drops the "rah rah, we're the best fucking country in the world" bs and eats a slice of humble pie it will realize that providing healthcare to it's citizens isn't really a very difficult problem to solve.

Yes, the US healthcare system is broken. But its not as easy as you make it out to be. Look at our drug costs - they're way higher than anywhere else. Where's that money going? Largely to medical research companies. The US is, to some degree, subsidizing medical research for the rest of the world.

Now, there are a lot of places we could improve by looking to other countries. But even doing all of those things isn't going to make things as cheap here as they are everywhere else.

Drug costs are a great example of where the USA could easily improve, if the lobbyists allowed. Because they are predictable and unceasing, drug costs for chronic conditions should not be covered by an insurance regime. It's as silly as purchasing food or clothing with insurance. Of course, once actual consumers are buying, competition will drive costs down.

That isn't to say I don't have sympathy for those who need extremely expensive drugs on an ongoing basis. That is a hardship, which could be ameliorated by government payments, e.g. Medicare, Medicaid, or something similar. But there should also be a middle category, of drugs that are expensive but which most patients can reasonably afford without government assistance. Drugs in that category will tend to see swift price drops as soon as the FDA allows generic competition.

> The US is, to some degree, subsidizing medical research for the rest of the world.

First, that is true to only a small degree, second, it is irrelevant to the companies' revenue. Some may miss income in some countries due to generics and lower copyright protections but even solving this issue wouldn't decrease prices in the US.

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