Health care cost hikes were inevitable

Perhaps it isn't Minnesota Nice (that wonderful liberal euphemism for shutting up conservatives) to say "I told you so." But I told you so.

For years I've been arguing that there's no such thing as a free lunch. Now, as more and more realize that "free" health care isn't so cheap, I'll bet I'm not the only one wishing Democrats would just quit proving me right.

Indeed, Minnesotans are reeling from a rather predictable Obamacare sticker shock that a few of us brave souls warned about. Preferred One, after quickly dropping out of MNsure, has jacked up its premiums for off-exchange individual plans by an average of 63 percent.

Boy, didn't see that one coming.

Of course, Preferred One wasn't the only insurer to buy the Obama administration's snake oil that increases in underwriting premiums would offset the staggering cost of the Affordable Care Act's new coverage mandates. Sadly, the industry, as well as the American Medical Association, got in bed with the administration by failing to heed the Churchillian maxim that feeding the crocodile only guarantees you'll be eaten last.

Notwithstanding the numerous exemptions made by the White House, there was never any realistic possibility that the litany of mandates — especially coverage for "pre-exisiting" conditions — could ever be shouldered without drastically raising insurance premiums across the board. Obamacare's de facto "community-rating" decree saw to that.

Here's what I wrote on these pages ("Government Health Care is On The Way," Sept. 30, 2010) shortly after the ACA passed:

"However, if health insurers must issue a policy without being able to charge a price commensurate with the risk, I'll just wait until I get sick to buy it, thank you. The obvious result will be an insurance pool made up of the sickest customers, which of course is no pool at all.

"President Obama insists that his legislation's individual mandate to purchase insurance (of questionable constitutionality) will offset the gargantuan costs of a 'pre-existing' mandate and other mandates. Would that it were true. The penalties, taxes (or whatever they're calling them these days) that will be levied on individuals and businesses for not buying in are no match for the freebies that Democrats seem intent on handing out. For the insurance requirement to be effective, penalties would have to mirror the cost of today's premiums, which of course defeats the purpose of the entire enterprise: free health care."

Like I said, I told you so.

The end result is a health care system bursting at the seams. As more employers drop unaffordable coverage or dump part-timers into the exchanges, the fantasy of the ACA costing only $1 trillion over the next decade has been summarily laid to rest. Hence, MIT's Jonathan Gruber's admission that the law would not have passed without duping the American people first.

And yet, the Obamacare architects were too clever by half, because the law's implementation was always going to be a Democratic debacle. In Minnesota alone, the legislative auditor found that MNsure squandered $1 million in selling the plan because the state "did not have adequate controls over marketing costs and the collection of receipts and did not comply with some of its board policies and Minnesota Statutes."

About the only thing your skyrocketing premium buys you now is higher deductibles and stricter drug formularies. Of course, you can always let MNsure shove you into Medicaid's overtaxed (and under-reimbursed) network, whose waiting lines are the first visible sign of government health care rationing.

Gov. Mark Dayton, chief apologist for the ill-fated scheme, says despite all the problems the law is working by covering folks with chronic conditions who otherwise would have been denied. How ironic. Those facing denial in the individual market do so only because government destroyed true portability — first through wage and price controls and now though the tax code — by subsidizing employer-based coverage.

Anyone who's had to pay COBRA health insurance rates knows what I'm talking about. Because government policy has tied your health insurance to employment, those who are laid-off are stuck trying to buy individual plans for the first time later in life when their health is obviously not as robust as it once was.

Real reform would encourage the young and healthy to buy low-cost guaranteed-renewable contracts covering catastrophic events. This would solve the problem of "pre-existing" conditions for the vast majority of subscribers. In order to actually allow people to buy the coverage they want, however, you would have to not only repeal Obamacare, but change the myriad rules and regulations (including the tax code and onerous state and federal coverage mandates) that predate the law.

But it sure beats a "free lunch."