“For the 85% of enrollees with lower incomes, federal subsidies make the premiums somewhat more affordable. Those even closer to the poverty line can get additional subsidies that reduce the deductibles, which can run into the thousands of dollars.
But for many middle class Americans -- a single person earning more than $47,520 or a family of four with an income of $97,200 -- the pricey premiums and deductibles mean health care coverage remains out of reach.
"The middle class are getting squeezed," said Larry Levitt, senior vice president at the Kaiser Family Foundation. "They aren't getting subsidies and these deductibles are hard to afford."
This schism is turning Obamacare into another government benefit program for lower- and moderate-income Americans. The typical enrollee has an income of only 165% of the federal poverty level, or $40,000 for a family of four.
The real problem is that health care is very expensive, Levitt said. But most Americans don't realize the true cost because they are shielded by their employers.
Some 150 million people have insurance through work, paying only about $440 a month for a family plan, while employers cover the rest, or about $1,075.” - Is Obamacare really affordable? Not for the middle class, Obamacare is now a tale of two health insurance programs, CNN money, 11/04/2016
Note: The seen and unseen regarding the above, the unseen as it were, might well be found in Director’s Law, political constituency building with other people's money and the backfiring (unintended negative cascading consequences) of the conjunction of both concepts. How so? (1)
Reviewing Director’s Law:
Director's law states that the bulk of public programs are designed primarily to benefit the middle classes but are financed by taxes paid primarily by the upper and lower classes. The empirically derived law was first proposed by economist Aaron Director.
The philosophy of Director's law is that, based on the size of its population and its aggregate wealth, the middle class will always be the dominant interest group in a modern democracy. As such, it will use its influence to maximize the state benefits it receives and minimize the portion of costs it bears. (2) (3)
Hence if in the main and upon normal occasion ACA/Obamacare is viewed as a program to benefit the middle class, then the benefit thereof could easily be considered as: Particular politicos exercising political constituency building with other peoples money. That is, yet another middle class benefit at the expense of other taxpayers which leads to a political constituency wanting the continuation of the benefit and therefore reliance upon (support/voting for) the sponsoring politicos of such program.
The problem then becomes: Much of the middle class, rather than benefiting, are being pummeled by skyrocketing premiums along with high deductibles and high co-insurance payments.
In the end, a middle class benefit (Director’s Law) meaningfully and purposefully deployed as a political constituency building exercise by particular politicos with other people's money, backfires. Backfires as a vast swath of the middle class fails to benefit and actually experiences rising prices.
The supposed political constituency developed by the politico becomes an advisory political constituency.
Notes:
(1) http://www.econlib.org/library/Bastiat/basEss1.html
(2) https://en.wikipedia.org/wiki/Director%27s_law
(3) https://www.jstor.org/stable/724835?seq=1#page_scan_tab_contents
“Experts say the administration has until mid-November to iron out the problems or risk jeopardizing its goal of signing up 7 million people in the first year of the Obamacare marketplaces. The number includes 2.7 million healthy young adults whose participation will help offset the higher cost of insuring sicker and older beneficiaries.” - Obamacare site improves, but new problems emerge, msnnews, 10/16/2013 (1)
“The number includes 2.7 million healthy young adults whose participation will help offset the higher cost of insuring sicker and older beneficiaries.”
Certain political elements make a concerted effort to court young people. This same element, in the main, wants to charge the young to cross subsidize the old in regards to health insurance. Cross subsidization is by no means a new tactic e.g. Social Security and Medicare at this juncture are basically pay-as-you-go with the young paying for the old. But the new tactic is: The blatant advertising of the cross subsidy stratagem.
Hence certain political elements that court younger people with promises of political solutions to economic problems i.e. social justice are advocating the younger subsidize the older. Why wouldn’t each age group merely pay for the risk they themselves represent? Why would the least wealthy group, the young, pay for, in the main, the more wealthy older group? Reverse social justice?
Beyond social justice being a mirage [F.A. Hayek], younger people might want to examine Director’s Law:
Director's law states that the bulk of public programs are designed primarily to benefit the middle classes but are financed by taxes paid primarily by the upper and lower classes. The empirically derived law was first proposed by economist Aaron Director.
The philosophy of Director's law is that, based on the size of its population and its aggregate wealth, the middle class will always be the dominant interest group in a modern democracy. As such, it will use its influence to maximize the state benefits it receives and minimize the portion of costs it bears. (2) (3)
Moreover, a media barrage has begun aimed at the young with the by-line of: you must purchase as it’s the “law”. Is it "law" or is merely manmade legislation created by the stroke of a pen and can be voided by a stroke of a pen? Legislation is top-down edict of the few whereas law is emergent order of the many which emerges over long periods of time. Adding the label of "law" to manmade/mandated legislation of the few, is merely a political attempt to give the weight of law to legislation. (4)
Maybe the young, those that feel they are being railroaded, should consider reading Thomas Lambert's, law professor at the University of Missouri, essay entitled How the Supreme Court Doomed the ACA to Failure. Why would the young want to read such essay? The essay includes the quintessential ACA work around of when to pay the tax [penalty] and when to buy the insurance. Lambert offers charts, examples and includes a to-the-point discussion.
The link to Lambert’s essay appears below:
http://www.cato.org/sites/cato.org/files/serials/files/regulation/2013/1/v35n4-5.pdf
Notes:
(1) http://news.msn.com/us/obamacare-site-improves-but-new-problems-emerge
(2) Director’s Law
http://en.wikipedia.org/wiki/Director's_law
(3) (4) Law, Legislation and Liberty, Volume 2: The Mirage of Social Justice, F.A. Hayek
http://www.amazon.com/Law-Legislation-Liberty-Mirage-Justice/dp/0226320839/ref=sr_1_7?s=books&ie=UTF8&qid=1381998835&sr=1-7&keywords=f.a+hayek
