Call It What It Is: Insurance, for millions, is organized extortion

December 2, 2015

Isn't it odd that the Affordable Care Act, described as a "socialist" program by so many talking heads, has led to record profits in the health care industry?


Prior to implementation of the Affordable Care Act (ACA, aka Obamacare), insurance was exhorbitantly priced and covered little. Virtually everyone felt the medical/insurance system was tragically broken. The only ones who didn't believe the insurance racket was a racket were those making the profits.


Now with Obamacare in place, insurance has graduated from being an outrage to being extortion. A harsh word for a harsh reality. Wikipedia clarifies the matter:

In this current racket, the insurance industry gathers the money and has the government as its thug, threatening and enforcing penalties against those who refuse to throw their money into the belly of the insurance industry. An adult without health insurance incurs a tax of $325 in 2015; in 2016 it increases to $695.


Those making modest incomes can't afford high monthly premiums, so lower monthy payments are essential. On those plans, with deductibles as high as $6,800 each year for an individual, it means if someone needs medical services it will cost an out-of-pocket average of $550/month ($6800/12 months)  just to meet the deductible! This is, of course, on top of the monthly premium.


So those in the middle class earning a modest income and working in one of the millions of small business that can't afford to offer health insurance, must opt for a high-deductible plan. This is a financial necessity, not simply a preference. If medical services need to be used, the cost can easily run into the thousands even for routine procedures.


For example, let's say a self-employed, self-insured individual with a high deductible plan has significant stomach burning and pain that is not responsive to medications. The doctor orders an imaging procedure called an upper GI, which costs about $3000. This will have to be paid as part of the deductible. Let's also say that pre-malignant cells are found in the small intestine, and the recommendation is made for a repeat upper GI in 6 months. When that time arrives, it will again cost $3000.


And of course each time there is the cost of the office visits (probably about $300 each). And still the deductible hasn't been met. This individual is paying probably around $500/mo premium, then needing to come up with $3000 twice a year in order to check for malignancy. For the tens of millions who struggle each month to simply pay basic living expenses, $3000 is not small change. In fact, these expenses are the most common cause of bankruptcy. The ACA does nothing at all to help avoid medically induced bankruptcy.


Maybe in the few months remaining in the year, as visits add up and the deductible finally gets met, this individual can eek out a few procedures and therapies that are covered. Ironically, even these will likely be covered at a percent, not completely. And then, the new year rolls around and it starts all over.


But as with any true extortion setting, opting out is not a viable option. If a catastrophic medical event happens, lack of coverage can be a death sentence, as doctors commonly make treatment decisions based upon the patients insurance status.


The ACA has been an enormous advantage to those below the poverty level. Millions who could not afford health care now get it subsidized by the government. The dark side of the ACA, though, is that it has shifted an enormous burden of medical expenses onto the middle class, the very economic group that has always driven economic growth.


Obamacare didn't fix what is broken about health care. Only public outrage on the part of a middle class drowning in medical expenses can do that.





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