NCPA - National Center for Policy Analysis

How Seniors Will Pay for ObamaCare

September 23, 2010

The cost of ObamaCare will be quite high for some people, says John C. Goodman, president, CEO and Kellye Wright Fellow with the National Center for Policy Analysis.  

  • By 2017, thousands of people in Dallas, Houston and San Antonio will be paying more than $5,000 a year in lost health care benefits to make ObamaCare possible, according to a study published this month by Robert Book at the Heritage Foundation and James Capretta at the Ethics and Public Policy Center.
  • For some New York City dwellers, the figure will exceed $6,000 a year.
  • Residents of Ascension, La., will pay more than $9,000 in lost benefits.

Who are these people?  These are the enrollees in Medicare Advantage plans.  In many areas, Medicare Advantage enrollees will lose about one-third or more of their health-insurance benefits, says Goodman.

Ostensibly, Medicare Advantage plans do everything President Obama says he wants to accomplish with health reform, including provide subsidized coverage to low- and moderate-income people and no pre-existing condition limitations.

On measures of quality and efficiency, they also score well.  According to a study published in June by the trade group America's Health Insurance Plans:

  • Medicare Advantage enrollees had 33 percent more doctor visits (presumably representing more primary care), yet experienced 18 percent fewer hospital days and 10 percent fewer hospital admissions than conventional Medicare patients.
  • They had 27 percent fewer emergency room visits, 13 percent fewer avoidable admissions, and 42 percent fewer readmissions.

According to a report published in April by the Medicare Office of the Actuary, about 7.4 million people who would have been enrolled in Medicare Advantage plans in 2017 will lose their coverage completely.  Those who are able to retain their coverage will lose significant benefits.

To those who view this as an entitlement wash, don't be misled.  Many of the seniors losing their health plans will enroll in taxpayer-funded Medicaid, in addition to Medicare, says Goodman.

Source: John C. Goodman, "How Seniors Will Pay for ObamaCare," Wall Street Journal, September 23, 2010.

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