Well, I Am Down To Two Health Insurance Choices

Apparently in the future I will have two health plan choices -- my current plan or the government plan.  And the only reason I will be able to keep my current plan is that is will be grandfathered in.  A few years ago I switched plans, to get one with a better price and mix of benefits for my family.  I will never be allowed to do this again under the new health care bill:

It didn't take long to run into an "uh-oh" moment when reading the House's "health care for all Americans" bill. Right there on Page 16 is a provision making individual private medical insurance illegal.

When we first saw the paragraph Tuesday, just after the 1,018-page document was released, we thought we surely must be misreading it. So we sought help from the House Ways and Means Committee.

It turns out we were right: The provision would indeed outlaw individual private coverage. Under the Orwellian header of "Protecting The Choice To Keep Current Coverage," the "Limitation On New Enrollment" section of the bill clearly states:

"Except as provided in this paragraph, the individual health insurance issuer offering such coverage does not enroll any individual in such coverage if the first effective date of coverage is on or after the first day" of the year the legislation becomes law.

So we can all keep our coverage, just as promised "” with, of course, exceptions: Those who currently have private individual coverage won't be able to change it. Nor will those who leave a company to work for themselves be free to buy individual plans from private carriers....

Wow, even for this cynical libertarian, this is a new low of technically complying with a promise while in substance completely violating the spirit of that promise.

By the way, how long will my current insurer even be able to offer me my plan given that it cannot generate any new business  (I use Assurant, who specializes in individual policies for self-employed people like myself).

This is a great example of what I have been saying all along - regulation always helps large companies more than small.   Everything in this legislation is tailor-made to help large companies who already have health plans and pound small companies and the self-employed.  This is in part because the large companies have the lobbying muscle to get themselves a seat at the table as the bill is crafted.   But it is more than just neglect, it is an outright attack.  Large companies most fear competition from smaller, lower cost competitors.  Anything to make the life of small business more expensive and difficult helps cement the big guys market position.

Update: Here is a scary thought -- what will it do to entrepeneurship in this country when a decision to leave a large company and go into business for oneself bascially means giving up private health insurance and going on Medicare?

Update #2: For readers, as well as a place for me to find it in the future, here is a link to all 1000+ pages of the bill.  Enjoy.


  1. Freelance Unbound:

    Wow. Even in statist Britain we haven't forbidden people from taking out private insurance as well as using the NHS. Yes we have a (criminal, in my view) restriction in using both during the same course of treatment. But even so – this is a nightmare of coercion.

  2. Charlie Brattrn:

    Medicaid not Medicare unless you are 65. Medicare is all fed money. Medicaid is a joint state fed deal which many think is much worse than Medicare.

  3. Damon Gentry:

    Reading further on page 16 (beginning with line 21):

    "the issuer does not change any of its terms or conditions, including benefits and cost-sharing, from those in effect as of the day before the first day of Y1."

    If I read this correctly, this means that (grandfathered) private insurance policies cannot change their benefits once this law is passed. They can neither increase benefits to be a more compelling option, nor can they decrease benefits to become more profitable. If I understand this properly, then this is Directive 10-289 in action.

  4. hoipolloi:

    This will be killer to the mere idea of working for one's self.

  5. James H:

    This has been one of my main concerns since O started talking about it. There will no longer be choices to tailor your coverage to your needs, and possibly worse, there will no longer be any competition to provide the most coverage at the lowest total cost. Instead, the cost will be fixed, and the coverage will fall short. There is no option to improve your benefits or coverage. Will self-funded procedures be allowed, or is this too unfair for those that can't afford them?

  6. Rob:

    Well, I guess it's going to be strictly black-market health care for me from now on. (How ironic, too, considering that I work at a hospital.)

  7. Global Warming:

    Thanks. This is exactly the perspective I needed.

  8. Kyle Bennett:

    "what will it do to entrepeneurship in this country when a decision to leave a large company and go into business for oneself bascially means giving up private health insurance and going on Medicare?"

    Backdoor to 10-289.

  9. Doug G:

    I still don't understand how you can claim to be reducing the cost of health care while at the same time you are talking about how to have to tax the wealthy to pay for it.

    I understand this has a price tag of $1 trillion dollars. Warren, this made me think of you argument against light rail. Why not spend this money on something that actually helps the system, rather than just introducing new layers of government intervention. For example, let's fund medical school so we can have more doctors. If medical care is too expensive, supply and demand tells us there must not be enough supply. For $1 trillion dollars, you could pay for medical school for over 6 million new doctors. (This based on a Google search that tells me the average med student graduates with $155K of debt.) That's one new doctor for every 50 people in the USA. That should help fix the supply problem and bring the costs of health care down.

  10. Dr. T:

    To me, the larger scandal is calling this pile of dung a federal health insurance plan. Insurance means that participants pay money into a pool so that the few with big claims don't go broke. The Obama health care plan has a only handful of insurees paying into a pool that is then filled by siphoning money from upper class taxpayers. Large losses are not needed for "insurees" to tap into the pool: even routine health care is covered. The pool will empty damn fast.

    This is not insurance. This is indirect transfer payments from the upper class to the middle class and lower middle class. It is another big step towards socialism. I hate to think about what it will do to our already mediocre quality of health care. We'll probably rate lower than Uganda in ten years.

  11. iceberg:

    Anything about barter/cash payments being made illegal? What about doctors/hospitals, can they reject the coverage (sorry, we don't accept ObamaCare)?

  12. nicole:

    Doug G., the supply problem can be fixed way cheaper than that. Just stop letting the AMA run a state-backed cartel and allow advanced practice nurses to perform simple procedures without the supervision of an MD.

    Seriously, this post plus the quote from Damon Gentry...argh. We cannot let this happen, it is really too much.

  13. spookyjon:

    Has anybody here actually read the text of the bill in question? The quoted passage is a part of the definition of plans that are grandfathered out of the new regulations. There is nothing stopping you from changing your insurer, coverage, or policy--it's just that once you change your policy, your new policy, being, you know, A NEW POLICY, won't be grandfathered.

  14. Methinks:

    I just changed my insurer this month. If they pass this piece of shit this year, my insurance won't be grandfathered in because I got it AFTER the first day of the YEAR in which this piece of putrid trash becomes law.

    People, has anyone written their congressman? Individually, we aren't of much use, but if enough people raise their voice, we can at the very least get rid of this restriction and maybe save the HSA.

  15. smurfy:

    From 2 pages after the quoted excerpt: "(1) IN GENERAL.—Individual health insurance
    coverage that is not grandfathered health insurance coverage under subsection (a) may only be offered on or after the first day of Y1 as an Exchange-participating health benefits plan."

    I haven't read more than about 50 pages of the bill but it appears the real intent of section 102(a)(1)(A) quoted above is to force private insurers into participating in this Health Insurance Exchange. This seems to basically mean that you will be able to offer private insurance for sale, so long as the terms and conditions closely (or exactly) match the govmn't plan.