The list of those opposing health reform includes Tea Partiers, libertarians and other small government advocates; the Chamber of Commerce, Association of Manufacturers, and National Federation of Independent Businesses; health plans (some of them), brokers, and insurers.
For some the issue is personal “liberty”, decrying governmental intrusion into what they believe should be an entirely “free” market.
Others are more specific, outraged that they are forced to buy a service from a private insurer.
But for some, primarily the larger DC-based organizations and their dues-paying members, the issue appears to be more broad, a general perception that reform is yet another indicator of increased governmental intrusion into ‘their’ business. Private companies want to be left alone, to run their businesses and do their stuff without what they view as often unnecessary and ill-advised interference from bureaucrats. The faith in the free market, the belief in unfettered competition’s ability to deliver the best result for the most is the underlying driver, driving many big companies – who would benefit from the mandate and most other provisions of the PPACA, to work diligently to overturn health reform.
Understand that those of us with insurance (including big corporations, small employers who provide health insurance, and governmental entities (and therefore taxpayers)) are subsidizing the health care needs of those without. The 49 million Americans without health insurance get health care, they just don’t pay for it; those of us with insurance do through the miracle of cost-shifting.
The willingness of reform’s opponents to sacrifice their corporate profits on the altar of the free market is admirable, as is the enthusiasm of libertarians and true followers of the Tea Party ideology.
But I wonder how ideologically pure they’ll be if reform is overturned.
As evidence of the potential consequence of failing to think thru the long-term and unintended consequences of ideological purity, I give you the Export-Import Bank, an agency of the federal government.
Stick with me here; the Ex-Im Bank provides credit to American companies selling goods and services abroad. For many companies, it is the ONLY source of credit financing their overseas business. As a result, the Ex-Im Bank helps drive exports, which creates and maintains employment, improves our balance of payments, and builds American companies.
But – the Ex-Im Bank is in deep trouble; the House has rejected further funding for the bank [opens video] (which is very profitable, generating over $5 billion in profits) thus the Bank will have to shut down in two months. If it does, businesses from tiny crop dusting aircraft manufacturers to Boeing, chemicals to finished products will find markets dry up, sales fall off, and profits plummet. We can expect layoffs at the Boeing plant in South Carolina, the duPont plants in North Carolina, Air Tractor in Texas, and Keller in Wilmington.
If that’s the necessary consequence of a return to an unfettered free market with less government intrusion, than so be it.
But that’s not what many backers of the GOP want. In fact, a long list of ardent supporters of the GOP, those who helped funded the historic gains won by Republicans in the 2010 midterm elections, are pretty unhappy with the men and women they elected. These new legislators, and ones who’ve been around for years, are the ones who are denying funding for the Ex-Im Bank, and thereby hurting the very folks who funded their successful campaigns. GOP Sens. Saxby Chambliss of Georgia, Charles Grassley of Iowa, Tom Coburn of Oklahoma Rand Paul of Kentucky Jim DeMint of South Carolina and Mike Lee of Utah are all opposing re-authorization of the Ex-Im Bank.
What some – Heritage and the Club for Growth – decry as corporate welfare and unfair competition, others of a very similar political stripe champion as critical to American business.
The same will happen with health reform.
If the Supremes overturn health reform and/or the individual mandate, employers, taxpayers, and individuals are going to see higher health insurance premiums. The entire market will be in a death spiral. As more opt out of coverage, the cost for the shrinking number of insureds will increase. Members of the Chamber of Commerce, the NFIB, and the Club for Growth will find their profits eaten up by health insurance premiums, or they’ll be forced to drop coverage entirely.
Individuals outraged by the mandate will be free to find coverage on their own, coverage which will be unaffordable for all but the richest Americans without any pre-existing medical conditions. New Jersey, a state with no mandate and restrictions on medical underwriting, provides insight into what individual insurance costs would be if the Court overturns the mandate (thanks to Bob Laszewski for the research)
a two adult plan with a $2,500 deductible and 80% coinsurance for example, there are only three carriers offering it. Aetna at $4,913 per month, Celtic at $12,322 a month, and Horizon at $6,127.78 per month. [emphasis added] These rates do not vary by age.
Yep, annual insurance premiums for two adults would cost between $60,000 and $148,000.
Hopefully they’ll be okay with that, secure in the knowledge that they’ve sacrificed good health and medical treatment, for themselves and their families, on the altar of liberty.
And no, the free market will not come up with a solution. If it could have, it would have by now.
Perhaps the fate of the Ex-Im Bank will encourage the ideologically pure to reconsider their objection to health reform, but probably not.