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Bluegrass Beacon: Obamacare’s spiraling costs are ‘public policy malpractice’

By JIM WATERS
Bluegrass Institute for Public Policy Solutions

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Thursday, March 2, 2017 — Reviews on cable news and social media of retired Kentucky Gov. Steve Beshear’s response on behalf of the Democratic Party to President Donald Trump’s first – and powerful – speech to a joint gathering of Congress aren’t great.

Speaking while seated in a diner with a small group of attendees who appear largely impassive in a let-us-know-when-we-can-get-back-to-the-pie-and-coffee sort of way, Beshear’s canned and casual approach made it seem more like he was headed to a backyard barbecue than issuing a serious response to the commander-in-chief’s weighty address.

“Small and stunty,” panned liberal MSNBC commentator Rachel Maddow.

However, “to be fair to Beshear, going after that Trump speech is like taking the stage after a U2 set with nothing but a ukulele in your hands,” radio talk-show host Buck Sexton tweeted.

If life hands you a ukulele, at least find an effective composition to play.

Nothing is ever as effective as truth – especially in these days of fake news and alternative facts.

Alas, it seems all Beshear can locate is “Obamacare’s Concerto for Ukulele and Liberals in F (for Failure) Minor” as he remains stuck on maintaining that 22 million more Americans, including a half-million Kentuckians, “now have health care that didn’t have it before.”

At least 14.5 million of those Americans – including more than 400,000 Kentuckians – got their coverage through the misnamed Affordable Care Act’s expansion of Medicaid eligibility, which simply means that all previously uninsured citizens on Medicaid now have is a card in their pockets identifying them as government-program beneficiaries.

No assurance of actual care exists.

But that’s just one of the problems with off-key claims by Beshear and his fellow Obamacare supporters.

Consider also:

· Obamacare provides a costly barrier to needed care.

A Families USA study shows that premiums for high-deductible plans purchased through Obamacare’s exchanges are increasing by double-digit amounts and more annually – 116 percent in Arizona last year alone – resulting in one in four of those customers skipping doctor’s appointments and medical tests while struggling to pay the bigger invoices.

How does this add up to better care?

· Labor-force participation is dropping in states using Obamacare to expand Medicaid.

While Beshear spoke of unemployment-rate drops, fiscal experts are more concerned about Obamacare’s impact on discouraging people from even looking for work.

Georgetown University researcher-turned government analyst Tomás Wind reports that “expanding Medicaid is associated with a 1.5 to 3 percentage point drop in labor force participation” in states that chose to join in the expansion.

· Obamacare perversely drives up costs then punishes individuals who work extra to pay for it.

People who’ve taken extra jobs to cover double-digit increases in premiums for policies obtained through Obamacare’s exchanges risk abruptly losing thousands of financial-aid dollars.

Tort reformer Ted Frank of the Manhattan Institute’s Center for Legal Policy used the Kaiser Foundation’s Health Insurance Marketplace Calculator to show how a 62-year-old earning $46,000 in a high-cost area suddenly loses the $7,836 tax credit that helps cover his premium if he earns $22 more.

Hans Bader of the Competitive Enterprise Institute in noting Frank’s example writes that while it makes sense to “gradually phase out” subsidies for those whose incomes rise and who need less government help, Obamacare takes a “far more extreme and indefensible” approach.

“It suddenly takes away thousands of dollars in subsidies when many people earn a few extra dollars – blindsiding many of them in the process,” Bader writes. “… That leaves them much worse off than if they had never earned that extra income, potentially leaving them poorer for taking on a second job to pay the costs of their health insurance.”

It’s so severe that our 62-year-old will have more take-home pay if he earns $46,000 than if he reaches $55,000.

Frank’s conclusion: “This is just public policy malpractice.”

Jim Waters is president of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank. Read his weekly Bluegrass Beacon column at www.bipps.org. He can be reached at jwaters@freedomkentucky.com and @bipps on Twitter.

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