Friday, February 10, 2012

The Free Lunch "Compromise"

Wow, President Obama and his administration must really think that religious organizations, or possibly even the public at large, are incredibly stupid.  The administration’s latest attempt to address another unintended consequence of Obamacare is astonishingly absurd. 
Let’s recap the chain of events leading up to today:
  1. Obamacare is passed by Democrats in Congress (Republicans objected en masse, but didn’t have the votes to stop it), and signed into law by President Obama. 
  2. Obamacare gives incredible amount of authority to the Department of Health and Human Services (HHS), headed by a Presidential nominee. 
  3. The President uses this unilateral regulatory authority to force all private employer-provided health insurance policies, including those purchased by religious organizations, to include no-copay, no-deductible coverage for various medications and procedures deemed necessary by HHS, including some forms of contraception.
  4. Religious organizations revolt, led by the Catholic Church, claiming that their religious freedom has been crushed by the requirement to pay for medications and procedures that are nominally prohibited under the rules of their faith.
  5. Watching his Catholic support go down the drain, the President panics and issues a workaround labeled as a "compromise." 
What is this compromise?  Drum roll please…
Just say it’s “free!” 
The compromise says that the religious organizations are no longer required to include coverage for the medications and procedures that are prohibited under the rules of their faith, however, all employees of those organizations will still have coverage for those medications and procedures, but it will be provided for “free” by the insurance companies. 
Were we the only ones to laugh out loud when we heard this “compromise?” 
There is no such thing as a free lunch and therefore someone is paying for this coverage.  Insurance companies are not charities, so they are not going to just absorb this cost on behalf of women everywhere.  Therefore, it doesn’t take a Harvard graduate to deduce that one of two groups will end up footing the bill for this exemption:
1)  The employees of the religious organizations
Nothing a little bit of verbal hocus pocus can’t solve.  The insurance company will charge the same premium to the religious organization employees, but will rephrase the wording of the women’s health coverage to say that it’s “free.”   They would be subsidizing the “free” coverage by paying more than they should for their religiously acceptable insurance coverage.  If this solves the religious organizations concerns, President Obama would be correct to think the religious organizations are incredibly stupid, or that their outrage was feigned from the beginning.  We recognize that this compromise claims that religious organizations will not be required to subsidize the cost of contraception, but this will be impossible to prove as you can’t accurately differentiate between the costs of each type of coverage in a complex health care insurance policy.
2)  Everyone
The insurance company may reduce the premiums charged to the religious organization employees, but that amount will be passed on to its other customers through higher premiums.  We realize this is par for the course with Obamacare mandates – i.e. pile on the populist mandates, forcing insurance companies to take the heat for raising premiums – but if this is the result, all employees of non-religious organizations should be outraged.  This would be yet another example of one group of individuals subsidizing another more favored group of individuals.  Why should we pay more for our insurance so that a religious organization can keep a clear conscience?  Isn’t that an infringement on our religious and/or ideological liberty?
Here’s an idea – why don’t we let individuals determine how much insurance coverage they require, and let the market offer flexible plans to meet those requirements at market prices?  What a novel approach for a capitalist society. 
If the government wants to subsidize women’s health care, like it does electric cars, ethanol, mortgages, and every other cause du jour, they should do so explicitly and raise the appropriate level of revenue to pay for that explicitly.  Forcing insurance companies to act as the tax collector is cowardly and despicable.    


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