Obamacare’s Costs Rise, as Obama Backers Get Preferential Treatment

The cost of Obamacare continues to explode and exceed its sponsors’ predictions. HHS Secretary Kathleen Sebelius has now admitted to double-counting in the Obamacare budget, using the same $500 billion twice, first “to sustain” the existing Medicare program and then to “pay for” brand new Obamacare entitlements. Last year, the CBO hiked its estimate of Obamacare’s costs by $115 billion, even as many of its promised benefits failed to materialize.

Obamacare was supposed to save patients money by curbing insurance company profits and expanding state Medicaid programs to cover millions more people. (This expansion was criticized by state officials, including a few Democrats such as former Tennessee Gov. Phil Bredesen, who called it “the mother of all unfunded mandates.” Bredesen’s health care legal advisor concluded that Obamacare’s Medicaid-expansion provisions were unconstitutional.)

But it turns out that waste in government programs like Medicaid and Medicare is far more costly than profits, which account for just a tiny fraction of private health insurance costs. Indeed, as the Weekly Standard notes, “Medicare Loses Nearly Four Times as Much Money as Health Insurers Make”:

In a newly released report, the Government Accountability Office (GAO) estimates that, in fiscal year 2010, $48 billion in taxpayer money was squandered on fraudulent or improper Medicare claims. Meanwhile, the nation’s ten largest health insurance companies made combined profits of $12.7 billion. . . In other words, for every $1 made by the nation’s ten largest insurers, Medicare lost nearly $4.

And that figure doesn’t even include billions more in “improper payments” in Medicare’s Bush-era “Part D prescription drug” program.

To try to limit insurers’ profits and administrative expenses, Obamacare imposes rules such as medical-loss ratios on insurers.  But these rules turned out to be so unrealistic that if actually implemented, they would wipe out countless health care plans, contrary to Obama’s broken promise that “if you like your present health insurance, you can keep it.”

So the Obama administration has “granted almost a thousand waivers” of those Obamacare rules, disproportionately to its biggest supporters, unions, such as the Service Employees International Union. Ironically, the biggest backers of Obamacare don’t have to comply with it — including the Teamsters Union, the United Food and Commercial Workers International Union, the International Brotherhod of Electrical Workers, and the Communication Workers of America.

Meanwhile, those without political connections to the administration bore the brunt of Obamacare. Twenty-two thousand seniors lost their high-quality health care plan in New England. AT&T, Caterpillar, John Deere, and Verizon reported massive cost increases, while insurance premiums rose massively in some states.

Columbia University law professor Philip Hamburger argues that the process for issuing Obamacare waivers is so standardless and subject to favoritism that it violates the constitutional separation of powers and the Non-Delegation Doctrine.