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The Spectacle Blog
After Congress passed its landmark health care legislation, I noted that it was only the beginning. The worse the health care system gets because of the law, the more Democrats will be clamoring for further intervention. And wouldn’t you know it, Senate Democrats are already trying to push separate legislation to regulate insurance premiums that will be driven up as a result of provisions of ObamaCare.
The new health care law imposes federal mandates on what type of benefits insurers have to offer —on top of the requirement that they cover people with preexisting conditions — all of which will have the affect of driving up premiums. Under the deal struck with the industry, insurers agreed to accept more regulations in exchange for a mandate forcing individuals to obtain insurance as well as hundreds of billions in subsidies for the purchase of their product.
Yet now Democrats are worried that before all of the new changes go into affect in 2014, that insurers will jack up rates in the meantime. Their answer is a proposal by Sen. Dianne Feinstein that would give the Secretary of Health and Human Services the power to reject rate increases deemed unacceptable. It’s similar to the idea President Obama presented in his final proposal, but that one had to be dropped because it couldn’t be passed through reconciliation.
The New York Times reports:
Mrs. Feinstein said her bill would close what she described as “an enormous loophole” in the new law. And she said health insurance should be regulated like a public utility.
“Water and power are essential for life,” Mrs. Feinstein said. “So they are heavily regulated, and rate increases must be approved. Health insurance is also vital for life. It too should be strictly regulated so that people can afford this basic need.”
Sen. Tom Harkin also said that, “Protections must be in place to ensure that companies do not take advantage of current market conditions before health reform fundamentally changes the way they do business in 2014.”
Of course, the reason why the changes to the market won’t take place until 2014 are entirely the result of a choice made by Democrats to game the Congressional Budget Office. By delaying the bill’s major spending provisions, it made the legislation appear cheaper under the CBO’s 2010 to 2019 budget window.
And as the Galen Institute’s Grace Marie Turner says, simply having the Secretary of HHS put price controls on insurance won’t work: “Capping premiums without recognizing the forces that are driving up costs would be like tightening the lid on a pressure cooker while the heat is being turned up.”
Of course, this is just one example of many we’ll be seeing in which Democrats will push for additional government intervention in an attempt to correct problems caused by government. Elsewhere, for instance, House Energy and Commerce Chairman Henry Waxman is talking about reviving the public option if the insurance exchanges don’t produce enough competition. Of course, it’s kind of hard to produce real competition when all insurance policies on any exchange have to meet the design specifications of the federal government.
So, to sum up, with one hand, Democrats want to regulate insurers like public utilities, which don’t have actual competition. And then, with the other hand, they want to use that lack of competition as a justification to create an entirely government-run insurer.
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Ellis Wyatt| 4.21.10 @ 1:52PM
Health insurance is vital for life? Did she really say that? What a dope.
Of course premiums are going to rise when you force insurers to cover more people and provide more services. Duh. So the answer, of course, price controls. Has that ever worked? What happens when insurance companies begin to go broke? Are we going to bail them out? I know the leftist argument is single payer, but that is a pipe dream and the American public would revolt.
This is one more failure of Obamacare that needs to be pounded by the republicans. People can understand driving up premiums and forcing companies out of business. Everyday I gain more comfort in knowing this whole disaster will be short lived.
Hunter| 4.21.10 @ 2:12PM
That bill makes sense. Healthcare reform was all about getting us to single payer and by capping rates, but not costs, the private system collapses and single payer can be installed. By having the power to cap rates, the Congress can make themselves out as the good folks against the evil insurance demons.
Ellis Wyatt| 4.21.10 @ 3:35PM
The left had their one chance for single payer this time around. As they lose power and more and more of this gets rolled back and amended single payer will become increasingly more difficult to obtain. I don't want it, but the left had their chance and blew it.
Warrior | 4.21.10 @ 3:36PM
Bullseye! If they cap the rates and drive the insurance companies either bankrupt or out of many markets, the government will be the only option.
Pingback| 4.21.10 @ 2:47PM
What Now? Obama Media & Team Obama Failed to Report Automatic Paycheck Deduction Hid links to this page. Here’s an excerpt:
democratsarefascists| 4.21.10 @ 3:56PM
Just like with gun control.
Democrats deliberately don't enforce the existing laws, and make the laws so obscure as to be unenforceable and impossible to obey, so they can say, "look how much worse it's getting!"
Then they pass more laws and grab more power.
martin j smith| 4.21.10 @ 4:26PM
Its time to also look beyond the specific issues that the Socialist agenda entails 0r is it entrails ? Any way my concern in addition to all of this is the election of 2010 itself. Voter Fraud and intimidation are a gaurentee. Look how the Socialist Democrat Party talks and acts vis a vis the Tea Party Movement !! I will bet this is just practice for the real deal. The MSM and BHO's cadre will be in full force punching twice as hard,using guns not knives etc--all in the rhetorical sense naturally. They will teach us how thuggury is done unless there is readyness..
Jim Hlavac | 4.21.10 @ 5:12PM
Let's see, healthcare is vital for life so must be gov't controlled? Ergo, soon to come: food (salt and "fat" already under assault) -- and too, clothing & housing (Fannie and Freddy already in semi-control of vast swaths of housing) -- vital to life and need to be gov't controlled. Then, because we live in a "modern" society it'll be telephone, television, internet, information -- vital -- hence to be controlled. Electricity too (being worked on as we speak.) What else is on the long list of things "vital to life" that must be controlled by Socialist-Democrats? Oh, yes, thought itself. Indeed, everything we see, hear, touch, read, write and do is "vital" to life - and by the Socialist mind -- controllable by gov't. They will stop at nothing, ever. They will ratchet it up, and nothing short of an "evolutionary-revolution" will stop them.
First step -- stop calling them Democrats -- they are Socialists and Marxists -- Indeed: internal imperialists -- and nothing less.
Jeff Perren | 4.21.10 @ 6:58PM
Excellent points, Mr. Hlavac. Of course, you know already that every example you named is already highly regulated, hence controlled. It's a matter of degree. We are near the elbow of the downward arching curve, or perhaps a bit past it.
If any politician were truly interested in "bending the curve," they should concentrate on that one. Regulations cost much more (explicitly and in values that never appear) than open taxation.
All that said, well said, sir.
Jeff Perren | 4.21.10 @ 6:54PM
They never learn. Price controls don't work (i.e. don't have the desired results and never lead to actual fixed costs). Whether they never learn this because they live in a fantasy world or whether they actually know and don't care, the result is always the same. Shortages.
If I were to suggest, if not a Constitutional amendment (Con Conv, no thanks) but an overarching law it would be that all legislators were required to pass a course on economics and to adhere to Austrian economic policy.
Of course, that too is a fantasy, but it's a much healthier one that the one perpetually engaged in by Progressive legislators.
glashoppah| 4.22.10 @ 8:03PM
The people that "never learn" are naiive voters. The politicians know exactly what they're doing: inserting themselves in the money stream so they can filter it through their pockets - and the pockets of their friends, family and cronies. All the lofty language is a diseased teat from which the naiive voter suckles, sure the government is "taking care of them." And the government is "taking care" of us, like the mob "took care" of its enemies.
R Givens| 4.29.10 @ 11:55AM
VOTE NO ON PROPOSITION 16
PROPOSITION 16 ROBS SCHOOLS
Allowing PG&E to get away with their attempt to lock in an electric monopoly with Proposition 16 will have a devastating impact on education. Listen to what Rob Ball, former Deputy Superintendent of the Woodland School District, says about PUBLIC POWER.
"SMUD is the best school bake sale anyone could ever hold.” Before he left Woodland for Sacramento’s Rio Linda district, Ball convinced the Woodland School District to support SMUD. “Last year in Rio Linda with SMUD service, we spent $669,000 for electricity for 22 schools,” Ball explained. “In Woodland, under PG&E, we spent $1.7 million for 17 schools and estimate that the amount will climb to $1.85 million this year. That’s over two and one-half times as much as we pay SMUD. This alone should tell you that SMUD is a far better deal.” According to their websites, Rio Linda and Woodand serve an equivalent number of students. see http://www2.dcn.org/orgs/localpower/ (SEE: http://www2.dcn.org/orgs/localpower/ )
Allowing a greedy corporation to plunder households, schools and businesses with excessive utility rates is just plain stupid. Remember that PG&E controls the PUC and will eventually get every rate increase they want.
Tell friends and neighbors about how a thieving power company is getting set to rip California off for billions. The impact on businesses will be severe. People will lose jobs because of the money going to PG&E.
How much money would YOU save with a 30% reduction in utility costs?
VOTE NO ON PROPOSITION 16
R Givens
Floyd Krautner| 4.29.10 @ 12:10PM
PG&E's campaign for Proposition 16 is one of the slickest corporation power grabs in a long time. PG&E is investing more than $30 million, so there must be some big money to be saved with public power.
Every single issue PG&E raises is utterly false. They claim to be protecting voter rights by preventing majority decisions. Moreover, they do not allow any votes 2/3 or any other way to object to PG&E rate increases.
The site Givens mentioned http://www2.dcn.org/orgs/localpower/ tells the true story. Public power is 30% cheaper than PG&E. That means that there will never be any huge electric bond debt for the public to pay off. The 30% profit margin will be used to buy PG&E's infrastructure and pay the debt off very quickly. Then electric customers get a 30% rate reduction.
PG&E pretends to be a "private" corporation, but PG&E has been a huge recipient of Government handouts. Their theft of Hetch Hetchy is on example.
Unless electric rates are controlled, the entire economy of California is at risk.
I agree with Givens
VOTE NO ON PROPOSITION 16
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Passing ObamaCare Was Just The End of the Beginning | Healthcare news links to this page. Here’s an excerpt: