Best of the Week
Most Popular
1. Five Charts That Show We Are on the Brink of an Unthinkable Financial Crisis- John_Mauldin
2.Bitcoin Parabolic Mania - Zeal_LLC
3.Bitcoin Doesn’t Exist – 2 - Raul_I_Meijer
4.Best Time / Month of Year to BUY a USED Car is DECEMBER, UK Analysis - Nadeem_Walayat
5.Labour Sheffield City Council Election Panic Could Prompt Suspension of Tree Felling's Private Security - N_Walayat
6.War on Gold Intensifies: It Betrays the Elitists’ Panic and Augurs Their Coming Defeat Part2 - Stewart_Dougherty
7.How High Will Gold Go? - Harry_Dent
8.Bitcoin Doesn’t Exist – Forks and Mad Max - Raul_I_Meijer
9.UK Stagflation Risk As Inflation Hits 3.1% and House Prices Fall - GoldCore
10.New EU Rules For Cross-Border Cash, Gold Bullion Movements - GoldCore
Last 7 days
Bond Market Bear Creating Gold Bull Market - 19th Jan 18
Gold Stocks GDX $25 Breakout on Earnings - 19th Jan 18
SPX is Higher But No Breakout - 19th Jan 18
Game Changer for Bitcoin - 19th Jan 18
Upside Risk for Gold in 2018 - 19th Jan 18
Money Minute - A 60-second snapshot of the UK Economy - 19th Jan 18
Discovery Sport Real MPG Fuel Economy Vs Land Rover 53.3 MPG Sales Pitch - 19th Jan 18
For Americans Buying Gold and Silver: Still a Big U.S. Pricing Advantage - 19th Jan 18
5 Maps And Charts That Predict Geopolitical Trends In 2018 - 19th Jan 18
North Korean Quagmire: Part 2. Bombing, Nuclear Threats, and Resolution - 19th Jan 18
Complete Guide On Forex Trading Market - 19th Jan 18
Bitcoin Crash Sees Flight To Physical Gold Coins and Bars - 18th Jan 18
The Interest Rates Are What Matter In This Market - 18th Jan 18
Crude Oil Sweat, Blood and Tears - 18th Jan 18
Land Rover Discovery Sport - Week 3 HSE Black Test Review - 18th Jan 18
The North Korea Quagmire: Part 1, A Contest of Colonialism and Communism - 18th Jan 18
Understand Currency Trade and Make Plenty of Money - 18th Jan 18
Bitcoin Price Crash Below $10,000. What's Next? We have answers… - 18th Jan 18
How to Trade Gold During Second Half of January, Daily Cycle Prediction - 18th Jan 18
More U.S. States Are Knocking Down Gold & Silver Barriers - 18th Jan 18
5 Economic Predictions for 2018 - 18th Jan 18
Land Rover Discovery Sport - What You Need to Know Before Buying - Owning Week 2 - 17th Jan 18
Bitcoin and Stock Prices, Both Symptoms of Speculative Extremes! - 17th Jan 18
So That’s What Stock Market Volatility Looks Like - 17th Jan 18
Tips On Choosing the Right Forex Dealer - 17th Jan 18
Crude Oil is Starting 2018 Strong but there's Undeniable Risk to the Downside - 16th Jan 18
SPX, NDX, INDU and RUT Stock Indices all at Resistance Levels - 16th Jan 18
Silver Prices To Surge – JP Morgan Has Acquired A “Massive Quantity of Physical Silver” - 16th Jan 18
Carillion Bankruptcy and the PFI Sector Spiraling Costs Crisis, Amey, G4S, Balfour Beatty, Serco.... - 16th Jan 18
Artificial Intelligence - Extermination of Humanity - 16th Jan 18
Carillion Goes Bust, as Government Refuses to Bailout PFI Contractors Debt and Pensions Liabilities - 15th Jan 18
What Really Happens in Iran?  - 15th Jan 18
Stock Market Near an Intermediate Top? - 15th Jan 18
The Key Economic Indicator You Should Watch in 2018 - 15th Jan 18
London Property Market Crash Looms As Prices Drop To 2 1/2 Year Low - 15th Jan 18
Some Fascinating Stock Market Fibonacci Relationships... - 15th Jan 18
How to Know If This Stock Market Rally Will Continue for Two More Months? - 14th Jan 18
Everything SMIGGLE from Pencil Cases to Water Bottles, Pens and Springs! - 14th Jan 18
Land Rover Discovery Sport Very Bad MPG Fuel Economy! Real Owner's Review - 14th Jan 18
Gold Miners’ Status Updated - 13th Jan 18
Gold And Silver – Review of Annual, Qrtly, Monthly, Weekly Charts. Reality v Sentiment - 13th Jan 18
Gold GLD ETF Update.. Bear Market Reversal Watch - 13th Jan 18
Stock Market Leadership In 2018 To Come From Oil & Gas - 13th Jan 18
Stock Market Primed for a Reversal - 13th Jan 18
Live Trading Webinar: Discover 3 High-Confidence Trade Set-Ups - 13th Jan 18
Optimum Entry Point for Gold and Silver Stocks - 12th Jan 18
Stock Selloffs Great for Gold - 12th Jan 18
These 3 Facts Show Gold Is Set to Surge in 2018 - 12th Jan 18
How China is Locking Up Critical Resources in the US’s Own Backyard - 12th Jan 18
Stock futures are struggling. May reverse Today - 12th Jan 18
Three Surprising Places You See Cryptocurrency - 12th Jan 18
Semi Seconductor Stocks Canary Still Chirping, But He’s Gonna Croak in 2018 - 12th Jan 18
Land Rover Discovery Sport Panoramic Sunroof Questions Answered - 12th Jan 18
Information About Trading With Alpari And Its Advantages - 12th Jan 18

Market Oracle FREE Newsletter

6 Critical Money Making Rules

America, Land of the Poor, Home of the Sick

Politics / US Politics Sep 29, 2011 - 03:08 AM GMT

By: Submissions

Politics

Michael Finger writes: Thanks to a series of destructive government policies and incentives, a health care crisis has been steadily building in America for a generation or two. But the release yesterday of the Kaiser Family Foundation's annual survey reveals that the problem of unaffordable healthcare is becoming epidemic. According to the report, health insurance premiums have jumped nearly 10% in 2011 for the typical family, compared to a 3% increase in 2010. The average annual cost for family health insurance now exceeds $15,000 per year, about 30% of median household income!


At a time when the economy is essentially stagnant and the official inflation figures remain low, what could account for the dramatic price spike? It is no coincidence that the report covers a period of time when many of the provisions of the Obama Administration's Patient Protection and Affordable Care Act (Obamacare) have come into effect. I think we are seeing the initial impact of this law, which the Administration promised would reduce healthcare spending. Oops.

Like all pieces of legislation, Obamacare provided some perverse incentives that explain some of this year's outsized price increases. Starting next year, the new law will impose a system of price controls on health care services. Just like a city worker whose pension is determined by the final year's gross salary, these looming price controls have incentivized providers to boost prices as much as possible before they're "locked in." Since the recession has cut down on doctor and hospital visits, this anticipation, rather than rising costs, appears to be a main driver of price increases.

Once price controls take effect, there will be only one way for these companies to keep up with rising costs and a growing cohort of retirees needing care: cut the quality and quantity of service. As a result, recipients won't be paying more for health insurance, they'll just be getting less. So, to the extent that the insurers can raise prices in anticipation now, they may have to cut less in the future. Perhaps we should be thanking them.

Still, the increases are painful at a time of economic depression. Unfortunately, employers are hit even harder than individuals under Obamacare. For example, employers are now forced to cover the children of employees until they are 26 years old! Including healthy 20-somethings in the comprehensive, low-deductible plans offered to most established corporate employees is sure to drive costs up - even if it's a net benefit to insurers.

Businesses are also mandated to pay for preventive care at no cost to employees. While preventive care can lead to savings in the long-run, it does not necessarily do so. I know someone covered by such a plan who receives a twice weekly massage at no cost. Is this an investment in future health, or an unfortunate loophole in a law Speaker Pelosi said Congressmen should "pass... so [they] can find out what's in it"? Whatever the case may be, it's no longer up to employers and insurers to make these judgments, but rather bureaucrats in Washington.

By increasing federal intervention, Obamacare simply takes us further down the road to ruin. From the post-war tax laws that favored employer-provided insurance, to the Great Society's guarantee of healthcare for all retirees, to the 60 years of increasing regulation of doctors and hospitals, Washington has done everything to drive costs up and quality down.

A good case in point is the Clinton-era Health Insurance Portability and Accountability Act (HIPAA), which put doctors in a regulatory straightjacket. The law created rules about where patient charts must be stored, what type of computer systems doctors can buy, how life-saving research is conducted, and much more. The law also opened up a whole new avenue for patients to sue doctors and hospitals. Some argue that these laws are needed to protect medical privacy, but that is debatable. The point is that such blanket rules have no regard for practicality, cost, or individual circumstances.

Repealing HIPAA, separating insurance from employment, encouraging malpractice reform at the state-level, reducing regulations on hospitals, getting the state out of medical licensing, and reducing taxes for high income earners would all go a long way to driving down medical costs. But rather than improving market conditions, President Obama and his team are trying to force costs down with an iron fist.

Once Obamacare's price controls are in effect, rising inflation and a growing pool of elderly patients will drive the insurance industry to bankruptcy. Washington may then choose to bailout the major insurers and form quasi-governmental agencies, or they may take the opportunity to push for single-payer socialized medicine. By that time, doctors may have acquired all the skill and courtesy of typical DMV employees.

So, don't expect to see a major renaissance in American medicine any time soon. Instead, the future President Obama has created will be poor, sick, and old. Based on the Kaiser Foundation's report, it looks like we're well on our way.

Subscribe to Euro Pacific's Weekly Digest: Receive all commentaries by Peter Schiff and John Browne delivered to your inbox every Monday.

Click here to learn more about Euro Pacific's gold & silver investment options.

Michael Finger
Euro Pacific Capital, Inc.

Michael Finger is Communications Specialist for Euro Pacific Capital, a registered broker/dealer with 6 offices across the country.

Copyright © 2011 Euro Pacific Capital, Inc


© 2005-2018 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules