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How Obamacare Will Help Give Americans More Job Flexibility

Sy Mukherjee
Think Progress / News Analysis
Published: Monday 10 December 2012
The Wall Street Journal observes that the landmark health law will prove a crucial asset to yet another segment of the American population: those who are are trapped in their current jobs out of fear for losing access to health insurance.
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Obamacare extends health insurance to tens of millions of Americans, assists the nation’s most vulnerable by outlawing the worst excesses of the private insurance industry, and keeps Medicare solvent for American seniors. And the Wall Street Journal observes that the landmark health law will prove a crucial asset to yet another segment of the American population: those who are are trapped in their current jobs out of fear for losing access to health insurance.

This phenomenon — known in the industry as “job lock” — is an unintended consequence of America’s primarily employer-sponsored health insurance system. Studies have shown that workers who don’t receive insurance through their employers are one and half times more likely to switch jobs than the workers who have employer-sponsored plans. Since insurance coverage can’t be shifted between jobs, some Americans remain in their current positions longer than they would have otherwise because of their fear of losing health coverage, since private insurance might prove unaffordable for them.

This problem is particularly prevalent among older employees in their 50s and 60s, some of whom remain in their jobs simply because they are waiting to qualify for Medicare coverage. Even aside from the fact that this dynamic forces some people to work longer than they might want to, it also creates an inefficient labor market, since workers might not switch over to higher-utility job in order to maintain continuous benefits.

Luckily, Obamacare’s insurance exchanges will allow individuals to purchase coverage on a statewide market, and the law gives consumers tax subsidies with which they can purchase care. Furthermore, small employers might be less likely to forgo hiring due to coverage costs, sinceObamacare actually reduces smaller firms’ health care spending.

But proposals to raise the Medicare eligibility age from 65 to 67 would undo some of the progress made by Obamacare in this regard, forcing elderly Americans to work for even longer and exacerbating the “job lock” phenomenon — all while reducing health care spending marginally and shifting costs onto states, employers, and Americans’ health insurance premiums.

ABOUT Sy Mukherjee

Sy Mukherjee is a Health Reporter-Blogger for Raised in sunny Orange County, CA, Sy is an avid fan of basketball, football, the arts, and cooking. During college, Sy served as an appointed member of the 2012 New Hampshire Democratic Party’s Platform Committee and previously interned at CAP for the Faith and Progressive Policy team. He received a B.A. from Dartmouth College in June 2012, double majoring in government and religious studies.

ObamaCare is twinkles in the

ObamaCare is twinkles in the sky better than
in-your-face exclusions and cherry picking.

Indeed many could not move between states
to take advantage of employment or real
estate opportunities lest they "go naked" all
the while the cherry-pickers' friends called
those who didn't like it all manner of stupid
false names childishly. (Though that's still
the case till 2014 for adults, of course.)

But otherwise it replaces it
with a blanket-universal
exquisitely, precisely oligopolistic structure--
essentially single provider indeed--cartel.

The high risk exchanges are "outskirts of Medicare,"
which is national health insurance for customers the
carriers don't want but take back again for extra
pay. Where then also paid specially to manage on
a capitation basis, then bango! credit due them
that does create an ounce of "accountable care" and
then there they have made a contribution to
rationalization. Outside helping the carriers
milk not just the easy money but the high risk
patients, that kind of rationalization will only
struggle to exist meaningfully in the high risk
exchanges, subject to funding, but you can bet
(I'd imagine) those will be in the same sights
as is Medicare.

Where monopoly is extractive, it's profoundly
less desirable for the customers, and needlessly
inefficient and expensive system-wide.

So someone has to get shafted.

So, in a monopolistic system the unprivileged
participants pay for their being controlled so that
they may have less desirable markets and so they
can have much worse outcomes than necessary.

For the cheaper low risk policies that the young will
shoot for the Bronze Tier is as rich as 60% medical loss
ratio (40% operational profit.)

There is a modest list of deductibles not allowed. But they
to me eminently unimpressive. If you have an ambiguous
thing on your skin or a maybe seriously broken toe the
deductible will be a deterrent. If you've an alarming red
splotch in an eye but it's 3 weeks till your deductible resets
you might be inclined to wait till January.

For the most part accountable care, value-basing, the like
is not a major factor, if much of one at all (those will
assist the cartel in squeezing what they can out of the really
risky people in the high risk exchanges.)

It has been unreimbursed cost has been shifted to those who
are covered, the carriers' risk pre-defined with them not caring,
with the non-paying people who have suffered tragedy
going bankrupt. With ObamaCare the carriers will capture much of that
money except to the extent those in the high risk exchanges
get funding shafted along with Medicare.

Taleb explains "static" here (as in this case it's cartel-static.)

It's the same as this, as you're using a static oligopoly,
nothing to do with capitalism vs. socialism.

Get the picture?

I noticed "single-payer" and whatnot in prior comments.
What this is still beats cherry-picking and exclusions, but
it's cartel-single-provider. If you boiled the handful of
controlling giants to one it's then that co's insurance policy,
and frankly a rather obfuscating one. People will hardly
be able to compare values between coverage levels.

I've a site where I've proposed risk equalization, same
escrow mechanism funding outcomes bonuses, and still-profit
incentive allowed to live with all other delivery systems
(yes HMO's are the most famous for particularly disincentivizing
hospitalizations though they are not needed to serve for
everything--my own doctor wrote 2 textbooks and doesn't
practice in one) but with immunity from the anti-trust laws


Those entities, I propose, should also have
by charter-requirement impacting physician
and patient representation on their boards.

The system can turn profits but it has to do
better than the 21% projected by ObamaCare
itself for health/GNP by 2019 with so many
shortcomings. And it has to have better
outcomes. Done really well, the U.S. can be
No. 1, not that it's important to best others.
But in fact even the UK's NHS supporters and
Canada's NHI supporters are looking for
ways to improve.

Any program conforming oligopoly will primarily benefit
the oligopolists. That's why so many government programs
get black eyes.

Economically, mathematically the opposite is thus:
empowering people enriches those who enable the
empowering, unless they're the actual monopolists.

Where the oligopoly shortchanges employment, such as
that taking a back seat in favor of massive
money supply concerns stemming from massive free
reserves, and if also there are concomitantly intensely
limited employment opportunities, then that begins
resembling supply side slavery.

Where one has no choice but to surrender their retirement
income to nominal interest rates for the same reason,
then that begins resembling demand side slavery.

The only differences from the familiar plantation are the
degree and the cotton. But understand, undoubtedly
Thomas Jefferson was a benevolent master to his slaves.

The slavery bit kicks in, to matters of degree, as in where
employment is thereby intensely limited, though most simply to one employer.

Then, remove the protection afforded by a union. Voila. Sharecropper.

On the demand side it's spinning wheels. Retirement savings'
income appropriated w/o choice not due to fair market behavior.
It used to be a single wage earner could raise a family in a house
and put a couple kids through college w/o incurring debt up to his scalp.

The Easter Islanders ate their trees. We incentivized it
and even made creating the adversity an important
profit center for the ultra rich because oligopolistic
systems self-destroy.

Maybe that's why the South was pushed over by the North.

And some people are wondering about comparisons,
$US / $Confederate.

I couldn't agree more with

I couldn't agree more with the contention that job lock is a significant problem. It limits economic freedom and stifles growth. As a 73 year old engineer, I've known many co-workers who would have left their jobs to launch new businesses or participate in start-ups were it not for their concern about health care for their families. However, Obamacare is the worst of all solutions - a business-government hybrid. The business side will constantly seek to increase profits by manipulating the law and when problems occur, each side will obscure the solution by blaming the other.
For most of my career I advocated a market-based system. But now that I've witnessed the creation of Obamacare and seen some of results, I'm convinced that a single-payer federal system would have been best.

Another rosy fairy tale about

Another rosy fairy tale about Obama care.

This article ignores several very important issues.

Under the best of assumptions, the CBO still estimates that 50 million Americans will be without health care. So this is not 'universal health coverage.'

The subsidy for people who are at or lower than 4 X the poverty level actually turns out to be $500 Billion direct transfers from the US Treasury to the insurance company coffers. The so-called beneficiaries are still faced with out-of-pocket costs for premiums, co-pays, deductibles, etc. etc. A typical family of 4 earning $66,370 will still be forced to pay $5,243 in premiums, plus $5,882 in annual out-of-pocket expenses, leaving them essentially no discretionary income. They simply won't be able to pay that much and will be forced to pay the IRS fine.

Contrary to popular belief there is no control over premiums. Insurance companies are getting around the '20% rule' by simply defining bogus services such as intrusive health care managers, or implementation of new diagnostic codes designed to deny coverage, or 'administrative services' designed to detect 'fraud' as 'medical management services' or 'activities that improve health services' and then charging an additional 20% on top of them.

In addition, both Rethugs and Demcraps have already taken steps to cut Medicaid funding to the states.

Now think about the over-worked doctors that currently take Medicaid patients. They are already beginning to receive less and less for the care of these patients. Taking these patients prevents them from scheduling patients who have better health care plans. So more and more of these doctors are currently and in the future refusing to see medicaid patients.

As fewer and fewer doctors see these patients, that only increases the load on doctors that still see them. This is a death cycle. You can have all the subsidies you want, but if there are no doctors available that take medicaid patients, it becomes the same thing as having no insurance and no health care.

The same sort of thing will happen as federal help for state medicare plans dries up.

As far as the exchanges go, it still remains to be seen if the plans offered in them will cover a comparable set of medical issues and if so at what cost. Many states are 'opting out' because of the long term cost burdens. So essentially these exchanges are going to provide un-affordable, under-insurance if they provide anything at all.

Instead of passing a law that was literally written by the health lobby verbatim, and in the process throwing the Public Option under the bus, what should have happened is Single Payer should have gotten a seat at the table.

But the insurance companies and the politicians that work for them from both parties knew that as soon as that discussion became mainstream, the people would have accepted nothing less.

We need Single Payer and we need it now.

Unless of course you're too

Unless of course you're too poor to afford the mandatory purchase of profit based health insurance at all. Then you risk fines and possible imprisonment for a trip to the emergency room for not having health insurance. For many, that mandate to give wealthy parasites their money will prevent them from seeking much needed health care.
The poor get screwed and wallstreet wins again.

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