
Health Law Tax Penalty? I’ll Take It, Millions Say - JumpCrisscross
http://mobile.nytimes.com/2016/10/27/us/obamacare-affordable-care-act-tax-penalties.html?em_pos=small&emc=edit_dk_20161027&nl=dealbook&nl_art=16&nlid=65508833&ref=headline&te=1&referer=
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riskable
I think we're just experiencing the ultimate end game of the system. The ACA
was nothing more than ointment on an infected wound. It worked for a time but
it is becoming more and more obvious that this leg our economy needs to be
amputated.

We _need_ a single payer system or at the very least a single body that
negotiates the price of all drugs and health care services _on behalf of all
Americans_. Frankly I'm surprised that the insurance companies aren't lobbying
for such a thing as it could be their only hope for continued existence very
soon.

The pharmaceutical industry would practically go to war to prevent a single
payer or a price-fixed system but they would lose if they're opponent was the
insurance industry (and the American people; who have very low esteem for "big
pharma").

A most interesting change resulting from an American single payer system would
be the _increase_ of drug prices for everyone else (other countries). As it
stands right now the only reason drug companies can get away with some of
their lower prices in single-payer countries is because the US can and will
make up the cost. Lowering the cost of drugs in some countries really _does_
result in higher costs for Americans.

~~~
maxerickson
_We need a single payer system or at the very least a single body that
negotiates the price of all drugs and health care services on behalf of all
Americans. Frankly I 'm surprised that the insurance companies aren't lobbying
for such a thing as it could be their only hope for continued existence very
soon._

What role do insurance companies have if there is a national body fixing
prices?

~~~
jefurii
Looks like not much of a role at all. After all of my experiences with
insurance companies I'm quite okay with that.

A NHS-style system would still need staff in order to function and I expect
many rank-and-file insurance people would end up there. The executives can go
to hell as far as I'm concerned.

~~~
maxerickson
Providers also have a lot of staff dedicated to working with the insurance
companies. I'm pretty sure billing complexity is one of the things driving
consolidation of physicians into large practices and health systems.

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bitJericho
The public exchanges are a slap in the face. Companies like walmart expect the
government to pay for healthcare. The poor wanted socialized healthcare to
make WalMart et al pay for it. The poor desire the destruction of the
insurance industry, and what they got was what they already had only with IRS
penalties.

~~~
fowlerpower
I think you hit the nail in the head.

Most poor people are worried about making ends meet the very last thing they
are thinking about is their taxes and possible IRS penalties. They are
expecting a refund and not to get hit with a fine. This is really just another
burden on the middle class, it was for sure an unintended side effect by the
folks who came up with his law.

~~~
wmccullough
An example of said burden on the middle class. I make a senior software
engineers salary and my wife has Lupus. I'm beginning to have signs of having
Lupus and RA myself. Her prescriptions alone barely have any coverage until we
meet our out of pocket max, and by then, 10-15% of our income is gone paying
just for drugs. This is on top of 25-30% taxes, plus the rising cost of food,
and now they are telling me I may need the same drugs as her? So in this new
found world, I could potentially lose up to 55% of my income in taxes and
health coverage. Oh and for a laugh, Medicare won't cover her because I make
too much. This is insane.

Despite this, I'm of the mind that we can't return to the way things were
before ACA, and ACA isn't the answer either. Something has to change or we may
have to move to another country with better options. People huff about waiting
lists, but neglect to realize that waiting lists are often for non-life
threatening surgeries. They also forget to tell the part about how routine
office visits don't have the same types of waits, and how prescription
coverage is still free.

All of my crying aside, I'm left with one thought. How in the actual fuck do
poor people afford this shit? I grew up poor and I know what we did--we didn't
have insurance and thankfully we were lucky enough not to have any chronic
illnesses in my immediate family when I was growing up.

On a lighter note, a small joke: I downloaded the GoodRx and it physically
started emitting laughter from the speakers once I typed in the drug names.

~~~
cmdrfred
>All of my crying aside, I'm left with one thought. How in the actual fuck do
poor people afford this shit?

A unpopular thing to say is that there exists two types of poor in this
country. The poor and the working poor. The poor are fine, they get Medicaid,
Medicare and discounts at the exchange. The working poor are fucked they get
to pay higher taxes because insurance is too expensive and when they lift
themselves up to a point where they can afford it, it doesn't cover anything
anyway.

This sort of bullshit has chilling effects. Rig the game so obviously against
low income Americans and they might just decide to stop playing. That is why
you see the lowest labor participation rates since the 70's. It's better to be
poor than working poor anymore.

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raverbashing
Want to fix healthcare?

\- Mandatory price transparency. Health care is procedures and medicines, not
a used car. Also all procedures signed off beforehand (with the exception of
emergency ones, naturally). If Procedure A costs $100 for Health Insurance A,
why should they charge a BS price for someone without Health Insurance?

\- Zero drug advertisement (maybe for no-prescription drugs, still)

\- Cut on incentives (briberies) by drug-companies

~~~
rayiner
I'm kind of on board with zero drug advertisements. But what rationale for
banning drug advertisements doesn't also apply to banning other kinds of
advertisements? I mean, I'd be on board with that too but I'm wondering if you
see some distinction.

~~~
kasey_junk
We do ban other kinds of advertisements already when we deem them against the
greater public good.

So I can see how banning drug advertisements falls into the same category as
banning cigarette ads, in that it makes for a more healthy public. The same
thing can of course be said about just about anything, but sometimes you just
have to stand on that slippery slope.

~~~
rayiner
The rationale behind banning cigarette ads is that those are products that
actively harm consumers. What's the equivalent rationale for banning drug ads?
Presumably, it's that drug advertisements cause people to, _e.g._ , demand
expensive brand names when cheap generic alternatives are available, or to
demand drugs they don't really need. But isn't that true for almost all
consumer advertising? Everything from toothpaste to cars to razor blades to
jeans to handbags?

~~~
kasey_junk
Sure. And if we decided that rampant razor blade advertising was causing
systematic pricing imbalances that dramatically impacted the greater public
good, we could ban those too.

~~~
rayiner
That begs the question. Consumers pay huge premiums for brand-name products
when cheap generic alternatives would serve the same function. Is that not a
"systematic pricing imbalance?"

~~~
kasey_junk
There was a second part to my requirement.

------
bonzini
It would be interesting to know how many of these people are from states that
didn't expand Medicaid. Of the two mentioned in the article, one is from
Georgia (didn't expand Medicaid) and the other is a customer of someone in DC
(could be from DC, Maryland or Virginia; the first two expanded Medicaid, but
Virginia didn't).

~~~
Amezarak
Why? If you would have qualified for Medicaid, had it expanded, you don't have
to pay the penalty anyway - the government doesn't punish you because your
state didn't expand Medicaid.

Only if you qualify for the subsidized private coverage (which poor people do
not) do you have to pay a penalty for not getting health insurance. Frankly
that part of the law is a little insane, even if it is because it wasn't
implemented as intended; if you don't have any income, then you have to pay
the _full price_ for coverage on the exchange, no subsidies. Your income has
to meet a certain minimum level to qualify for subsidies - the intent was that
below that level, you'd get Medicaid.

~~~
maxerickson
If you qualify for Medicaid based on income, I don't think you can buy from
the exchanges (the option is a similar plan off exchange).

------
patrickg_zill
Obamacare was expressly designed to fail, it seems.

Take an issue and make it worse, wait for the backlash, then come back to the
public and offer a new solution: single payer.

~~~
maxerickson
The design included risk corridor payments that aren't being met.

[http://www.cnbc.com/2016/05/18/health-insurer-highmark-
sues-...](http://www.cnbc.com/2016/05/18/health-insurer-highmark-sues-us-over-
obamacare-payments.html)

It's also really difficult to say what premiums would have been without the
changes the ACA made. Medical inflation has slowed since the law was passed,
but again, I think it is difficult to figure out how much of that to attribute
to the ACA.

~~~
xienze
> It's also really difficult to say what premiums would have been without the
> changes the ACA made.

No it's not. Forcing insurers to take people with pre-existing conditions
completely screws up risk pools. Anyone could've told you that doing so would
make premiums rise much faster than if those customers could be denied.

~~~
maxerickson
Right, but the must carry provision is not the only change the ACA made...

~~~
xienze
It's without a doubt the provision with the biggest impact. The whole point of
an insurance pool is to pay out less than you bring in, and if you suddenly
introduce a lot of people that cost more than they bring in, premiums have to
go up. A lot.

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forgotAgain
Twenty to fifty years from now historians are going to reference the ACA as a
case study of early 21st century American government:

1) hyper partisan political process

2) special interest control of the content of laws

3) release of information by the government used as a method to manage the
electorate rather than inform

4) front loaded benefits with back-ended payments

5) political class taking credit for the good stuff and leaving if for others
to clean up the mess

Generally speaking, all aspects of American government in this place and time
are reflected in the ACA. All aspects share the same sustainability issues.

------
kasey_junk
I see a lot of value in a single payer system as health care system as I
fundamentally believe healthcare spending does not conform to the same rules
as other parts of the economy and thus might make all of our (basic)
understanding about economics moot.

That said, single payer does not solve the single biggest classic problem with
the current healthcare system in the US and that is the agency issue. Right
now I _cannot_ make informed choices as a consumer in this market. Prices are
not transparent and the people negotiating the prices are not the people
receiving the care.

Further, we've coupled insurance to employment which is just insane.

Oddly McCain's health plan from a few elections back would have at least dealt
with the last point. I wonder if the exchanges would be more successful if the
entire population was buying insurance through them.

~~~
bnolsen
I see no value in turning a whole industry into defacto civil servants.
Doctors and nurses are people too who need to be able to choose themselves. I
don't give a rip about insurance. Getting access to health care is what
matters. Doctor/patient relationship is what matters. I see no need for
government to get involved other than stopping ethical type (illegal) abuses.

~~~
tptacek
If you don't give a rip about insurance, you should be especially irritated at
ACA and the ACA status quo ante, because the insurance companies and hospital
chains quietly negotiate the prices for health care services, collude to
establish favorable prices for the insurers, and lock individual consumers out
of those prices.

A fun experiment I've had the pleasure of running: try to get an MRI done
outside of your insurance policy --- that is, try to pay the rack rate for an
MRI, out of pocket.

------
teekert
Here in the Netherlands: You can't pay for health insurance? Here is some
subsidy to help you.

In the US: You can't pay for health insurance? Here is a fine of 700$

:s

~~~
maxerickson
The fine is structured such that only people that can pay for health insurance
are hit with it. The various income tests and whatever might not be perfect
though.

Here's some numbers.

~8 million people chose the fine[1].

More than 9 million people receive subsidies on the ACA exchanges[2].

About 58 million people receive Medicaid (heavily subsidized insurance)[3].

[1] [http://www.cnbc.com/2015/07/20/irs-more-paid-obamacare-
fine-...](http://www.cnbc.com/2015/07/20/irs-more-paid-obamacare-fine-than-
expected.html)

[2] [https://www.healthinsurance.org/obamacare/will-you-
receive-a...](https://www.healthinsurance.org/obamacare/will-you-receive-an-
obamacare-premium-subsidy/)

[3] [https://www.medicaid.gov/medicaid/program-
information/downlo...](https://www.medicaid.gov/medicaid/program-
information/downloads/cms-64-enrollment-report-oct-dec-2015.pdf)

~~~
drakonandor
The solution seems obvious. Instead of fining (those who can afford it), use
that money to pay for their Medicaid/Medicare.

That way they have insurance, which was the goal of this program, no?

~~~
maxerickson
What money are you talking about? The fines are coming out of the pockets of
the people that are not insured and they are choosing the fines because they
are lower than the cost of the premiums. So it isn't possible to insure them
with the money they pay in fines.

We know that they don't qualify for Medicaid (those people aren't fined). I
guess you could further expand Medicaid, but that probably wouldn't be real
popular, and there would probably still be fine payers that had too much
income to qualify for it.

------
pixl97
When I can get rent both a house and a car for the same amount health
insurance would cost me, the system is totally broke.

HillaryCare isn't working.

[https://twitter.com/HillaryClinton/status/697967580770869248](https://twitter.com/HillaryClinton/status/697967580770869248)

~~~
M_Grey
You had such a good point, until you scuttled it all by going pointlessly
political and partisan. There is a problem here, but it's utterly without a
political identity. The bottom line is that we need price controls, and
something like an NHS; the current model is just utterly broken. Nothing the
R's or D's are saying will change it either, and laying it at one person's
feet is pathetic and wrongheaded.

~~~
sharemywin
Free market + insurance version of healthcare. How much of my money(my
premiums) are you willing to spend to control your diabetes, risk of heart-
attack, or cure your cancer? I'll give you a hint, all of it.

~~~
M_Grey
It's a free market in the same way that we won the war in Iraq.

~~~
paulddraper
Twice? As in, it's twice the free market???

------
falcolas
I will always support the ACA, for one big reason: friends and coworkers of
mine who were denied insurance before can now get insurance.

I am more than willing to pay higher premiums (or tax penalties) if it means
that people who need treatments can now have access to those treatments
without going bankrupt.

------
JustSomeNobody
Insurance companies have to meet their quarterly earnings goals or investors
will punish them. If their lobbying can't get the tax penalty raised, then it
will continue to be a better deal for the young and healthy to take the
penalty.

------
0xcde4c3db
> It has not worked all that well, and that is at least partly to blame for
> soaring premiums next year on some of the health law’s insurance exchanges.

People love to blame any post-2010 health insurance problem on Obamacare, but
what's the evidence that rate hikes are actually significantly influenced by
PPACA?

~~~
mgkimsal
> but what's the evidence that rate hikes are actually significantly
> influenced by PPACA?

For 4 years before "mandatory purchase" was in effect, I saw annual 3-5%
increases in premiums. In 4 years since, I've seen ~20% increases each year
(last year was 'only' 11% increase - I'm bracing for much more).

The 'evidence' is insurance companies bringing in more people who previously
didn't have insurance - generally, they either needed or used more services
than whatever the premiums (+ subsidies) they were paying covered, and
insurance companies lose money because of this. In NC, BCBS lost ~$400million
last year (or so the claim goes). They can't sustain those losses
indefinitely.

