• A Glimpse of the Obamacare Future

      When Obamacare was signed into law, I predicted that the ban on "discriminating" against anyone with a pre-existing condition would mean that only sick people will buy insurance. If insurance companies have to charge me the same for insurance whether I'm sick or not, I'd be a fool to buy insurance now. I'd be better off waiting until I get sick. If only sick people buy insurance, that means insurance premiums will skyrocket.

      Of course, this provision doesn't go into effect until 2014...but you don't have to wait until 2014 to see what will happen. Massachusetts' health care system can provide us with a glimpse of the future because, like Obamacare, they forbid private insurers from charging different rates for people who are already sick. They also include the "mandate" which fines citizens if they don't buy health insurance.

      Is it working? The Boston Globe reports:

      The number of people who appear to be gaming the state’s health insurance system by purchasing coverage only when they are sick quadrupled from 2006 to 2008, according to a long-awaited report released yesterday from the Massachusetts Division of Insurance.

      The result is that insured residents of Massachusetts wind up paying more for health care, according to the report.

      ... The number of people engaging in this phenomenon — dumping their coverage within six months — jumped from 3,508 in 2006, when the law was passed, to 17,177 in 2008, the most recent year for which data are available.

      No surprise.

      HT: Peter Suderman.

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