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  • Obamacare: The Price Controls Begin

    The Department of Health and Human Services announced Tuesday that, starting next year, health insurance companies must receive permission from the Obama administration before they can raise rates higher than 10%. As we warned before Obamacare even became law, this is a form of price control, a government intervention that has a long and well established history of failure.

    Way back in 1993, Heritage Foundation scholar Heritage’s Ed Haislmaier was detailing the shortcomings of price controls in health care:

    Price controls would not work in health care because they attack the symptoms of runaway costs, not the cause. Medical costs today are soaring because consumers are largely insulated from them…and because the tax system discourages consumers from seeking good value for money in health care.
    Most policy makers who favor health care price controls view them as a way to curb rapid medical inflation. But most of the blame for that same inflation can be traced directly to previous government health care policies that they support or maintain. Health care price controls also are attractive to Members of Congress because they provide a benefit (cheaper medical care) to a favored constituency (health care consumers) at the expense of less favored constituencies (doctors, hospitals, pharmaceutical manufacturers, and insurance companies). This is why some Members of Congress are so quick to blame the health care industry for escalating medical costs, when in fact it is largely government laws, regulations, and policies that are responsible.

    Posted in Obamacare [slideshow_deploy]

    17 Responses to Obamacare: The Price Controls Begin

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    2. George, CO says:

      The entire health care discussion is totally misguided because of the disregard of why insurance exists. Insurance is to provide a safety net for unacticipated catastrophies. The continued argument is that people have to get auto insurance. It’s true if you choose to drive. That aside, insurance doesn’t provide for maintenance: oil and filter changes, new wiper blades, new tires. The owner is responsible. If auto insurance was mandated to cover these things, imagine what the cost would be. Health insurance is no different. Unfortunately, most people with health insurance don’t understand or appreciate the costs: low or no co-pays, low deductibles, coverage for elective surgeries and questionable drugs i.e.Viagra. I’ve been with companies that had extensive health insurance. Employees took children to the Doctor for anything and everything – $5 co-pay.

      Obamacare was designed to put health insurance companies out of business and set the stage fo Medicare for all, the Progressives’s dream. Unfortunately, they think everyone can have a Cadillac plan on a Yugo budget.

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    5. Ben Georgia says:

      If one really thinks about it , Obama did not raise the prices or the premiums , Corporate America Did !! Next we wouldnt be in this mess had obama not bailed out all those companies or had george bush had the balls enough to put a price cap in place before he left which could have headed this economic failure of or at the least lessened the effects of it .

    6. martinzclark says:

      The first new rule says you HAVE to have insurance. Both my husband and I have pre-existing conditions, and although the new bill says we can't be denied coverage because of it. So far, the cheapest health insurance we've been able to find is called "Wise Health Insurance" search for it online if you are pre-existing conditions.

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    8. Bob, San Jose CA says:

      I do not agree with this. Currently our health care system is broken and needs fixing. Today health insurance has a life time of cap of 1 million dollars. Anyone who has a catastrophe in their family consumes this limit quickly. This was needed to be fixed. On top of it people not in a job cannot get health insurance easily. Obamacare may be you do not like but we needed something like this. There will also be sections which all of us may not like.

    9. B Saunders - Arizona says:

      A family member who sells Health Insurance was making a decent living UNTIL ObamaCare. He is now struggling to make home, utility bills, car payments. The insurance companies tightened up on their commission returns as did the government for Medicare. This is what price control does – now, what is Kyle, McCain and the others going to do to help the "little" guy stay afloat?? Better do something and do it quickly!!

    10. e. cown carson city, says:

      I remember when Medicare started and how opposed my boss (an orthopaedic surgeon) was to the program.

      His fears were in some respects, unfounded. He didn't go broke – he just had to constantly raise his fees.

      As far as i can see the rapid, massive increases in the cost medical care came as a result of Medicare.

      In order to make up for what Medicare wouldn't pay, doctors, hospital, etc., raised their fees to patients with private insurance coverage – which in turn prompted the insurance companies to raise their premiums.

      It became a vicious cycle of raise and raise.

      Naturally, more and more people dropped any private coverage and companies who were drowning in ever increasing premiums for their employees, tried to shift some of the costs to the employees.

      And here we are today – the final insult to the injuries suffered by our medical system – ObamaCare.

      If this new congress doesn't get rid of it …… welcome to European style socialized medicine. The feds will control it all.

    11. Jill, California says:

      Healthcare professionals are as much to blame as the insurance companies for the out-of-control prices. When I've tried to get prices up front, I've gotten "fuzzy math" from healthcare providers, with pricing structures so convoluted that I can't make sense of what they tell me.

      I've also been told by my insurance company that they couldn't give me a price until after I'd had surgery. They wouldn't even give me a ballpark figure based on average payouts for a surgery without complications.

      There are very few industries where providers can get away with refusing to give prices up front and charging whatever they want after the services are rendered. This must stop before we can make any progress.

    12. Jeanne Stotler,Woodb says:

      I have to take up for the MD's, when all this started and the gov't. started getting it's nose into medicine MD's could not give a price. Prior to this they could say what an appendectomy, or tonsilectomy would cost. The Goverment started setting "fair rates" and deciding "HOW MUCH" the Doc's got out of it and they "doc's" had to continually raise their rates to cover their office expenses. Out of what a MD charges there is mal-practice ins., rent, util for the office, dues to both local and state medical assoc. lic. renewal, continueing edu.courses required for lic. renewal, staff, incl. nurses, and they must pay for the service that answers the office phone on off duty hours. When they accept Medicaid patients the charge is cut and they recieve a small portion, medicare is a little better, if they charge $179, medicare says fare rate is $150, then they pay 85% of that and patient pays difference or it's charged to a supplmental policy, same goes for hospital charges, contrary to what most think, most MD's are not rich, aside from their offices they also have families to support and homes to keep up. I am not talking about some specialties, I am talking about the doctor, pediatrician, etc you see on a general basis. OB/GYN, Cardiologist, orthopeadic doctor's all pay a huge malpractice ins. as well. I am a ret. nurse, and have a long list of Drs. in my family and NONE were what you call rich, they were comfortable and they desrve it.

    13. R Holland, Chandler, says:

      This is so damn frustrating. My insurance is going up 17% starting on Jan 1st. And I have health insurance through the federal government retirement plan.

    14. Chris says:

      If the government is involved in our healthcare, it will "go to Hell in a handbasket", just like any other government program does!! They will nit be able to handle our needs like a competitive market can. They are some D- doctors out there, and patients need to complain about them, so get them out of practice. But for the most part, doctors are very intelligent and want to do what's right for the patient. If Ocare is implemented, our best doctors will leave their practice, because they will no longer be able to make their own decisions about treating their own patients!! The decision will be made by a government appointed panel of people. Scary, plus how long will they have to make a decision and what about the patient in the meantime!! This is Not acceptable in this great country. Do whatever you can to put a stop to this!!
      http://www.PatrioticChristiansToday.com is a cause-driven group, who are standing up for our God-given rights in this country. And also, committing themselves to the betterment of USA. Join with US!

    15. Ben C. Ann Arbor, MI says:

      The fatal flaw of the arguement for control of health care is that it is a "right." It is not a "right." Only the creator can give a "right". A "right" given by a government can as easily be denied as given. Government intervention from the start has led to the mess we are in today. Had hospitals remained "for profit" the ER liability would not have happened and people would be far more savy concerning their health care. Insurance would have evolved but would be far more competitive and user friendly. If left to the market place tort reform would happen quickly. The simple concept "loser pays" would rid us of unwarranted lawsuites. Socialism has never worked – why must we keep reinventing the wheel?

    16. Joan, New Mexico says:

      For your reader's information, price controls on physician providers have been in effect for over two decades. Most physicians are contractually reimbursed at Medicare rates or below by so-called standard health insurance companies, which, even within the last quarter,according to the WSJ realized significant profits. Unlike the disinformation disseminated here, physlicians are not in a position to "raise prices as they please" in fact, prices are set by the ins co. and cannot be exceeded contractually. Also,if the patient decides not to pay a deductible or co-pay it is very difficult to collect. Furthermore, physicians are burdened by unfunded "mandates" to meet certain additional credentialing criteria and "pre-authorization" criteria for certain procedures, not standardized in the insurance industry (i.e. different for different companies). Ironically, costs have not decreased for the consumer even with "price controls" on physicians. Hospitals charge sometimes up to 3 time the rate for procedures which may be performed more efficiently in doctor's offices (and have more effective lobbyists).

    17. Bobbie says:

      totally agree with the 1st commenter. this is designed to dismantle private insurance or force them under government direction. they already are! private insurance is being paid for by the consumer while the consumer is also paying for obamacare. Oh, and about your health? Pray! Who knows who Obama will pick out of a crowd to give the title "doctor" to? There is NOTHING about this healthcare plan that is trustworthy.

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