Obama-Care: pay more for insurance you don’t want
October 27th, 2008 | by Brian Schwartz |From Cato’s Michael Tanner:
tags: community rating, Obama Care, special interestsQ: Will I be able to keep the insurance coverage I have now?
A: Not necessarily. On the stump and in commercials, Senator Obama says that his plan is based on allowing you to “keep your current coverage.” But what he is not telling you is that he wants to impose a “standard benefits package” that every plan would have to offer. Those additional benefits will reflect the power of various special interest provider groups and disease constituencies, not consumer preferences. So, if you have an insurance policy that you are happy with today, but it does not match the type of plan that Sen. Obama thinks you should have, then you will have to switch plans, even if the new plan costs more.
Q: Will I pay more or less for health insurance?
A: It depends. If you are a lower-income worker, Sen. Obama’s plan would provide you with substantial subsidies to help you pay for insurance. Sen. Obama also supports “community rating” that requires insurance to charge the same premium to everyone regardless of a person’s health. So, if you are older or in poor health, your premiums will likely come down. Community rating will increase premiums for the young and healthy in order to cross-subsidize those who are older and sicker. Sen. Obama has also promised that his plan would reduce premiums by increasing the use of electronic medical records, cutting administrative costs, and emphasizing preventive care, but most experts believe those projected savings are highly speculative and unlikely to be seen for many years - if ever.
