After shooting themselves in the foot by foolishly demanding that Obamacare be defunded or they would shutdown the government, the more level-headed Republicans switched to a more sensible bargaining position, one part of which was that Obamacare’s individual mandate be delayed by one year. After all, since Obama arbitrarily (and unconstitutionally) delayed the employer mandate by a year, why not the little guy — the individual policy holder?
President Obama responded, “Hell no.” And for good reason. Without the individual mandate, which targets our nation’s young, Obamacare is doomed. Obamacare needs young, healthy people paying into the system to counterbalance the older, more health-challenged people who will dominate the system, and who will cost Obamacare far more than they will pay into it. That is why Obamacare mandates that individuals — mostly young people — join it, or pay a fine.
But if I was in my twenties and entering the workforce, I would still seriously consider paying the fine rather than joining the health care exchanges. Why? Because as currently set up, if I don’t join Obamacare, I pay a fine equal to 1 percent of my salary, so, if I’m a job market newbie making $30,000 a year, my annual fine is $300. But if I join an exchange, my annual cost will be, at minimum , around $1,200, and that doesn’t include deductibles or co-pays. So, annually, it’s $300 if I don’t join and, at minimum, $1,200 if I do — a $900-plus difference.
But, you’re thinking, I am young and healthy now, but what if I get sick later on and I don’t have health insurance? The answer is: THEN join Obamacare! There are no pre-existing condition clauses, meaning that even if you get cancer, you can subsequently join Obamacare and be covered for it. It’s like totaling your car, subsequently buying auto insurance, and being covered for that car crash! The pre-existing condition waiver, while well-intentioned, was always the Achilles Heel of Obamacare. If healthy people don’t join it until they get sick, then only sick people will join the plan, and a health insurance program dominated by sick people is financially unsustainable.
That is why Obamacare mandates that our nation’s young and healthy join. They are needed because they will pay far more into it than they will get out of it.
In effect, they are subsidizing the seniors in the plan, just as they subsidize seniors through the payroll taxes they pay to fund Social Security, Medicare, Medicaid and many other entitlements enjoyed by our senior citizens. Which only seems fair. After all, the average net worth per household of our senior citizens is approximately $170,000, which is more than 50 times the average net worth of our nation’s young.