Where Do They Bury The Survivors?

Tuesday, November 12, 2013


A plane crashes on the Mexican – United States border. On board were U.S. citizens, Mexicans, Brazilians, and three passengers from Argentina. Where so they bury the survivors?

It is a classic misdirect. A mental sleight of hand. You know the answer. We don’t bury survivors.

Sleight of hand is an art. The best practitioners can shake your hand while they lift your watch and wallet. The trick for us is to watch them at work without becoming a victim.

I recently received an urgent email. A client forwarded Newt Gingrich’s article, “Obamacare’s Marriage Penalty and Divorce Incentive.” Was this true? Is the President anti-marriage?

Newt Gingrich as the defender of the sanctity of marriage? Guard your wallet!

I won’t bore you with the numbers. The federal subsidies are based on the size of the family, the ages of the insured, and are factored on the federal poverty level. A married couple with one child doesn’t need 33% more income when they have a second child. Couples don’t need twice as much income as singles to pay for food and shelter.

Will a few people get divorced to get a bigger health insurance subsidy? Perhaps. Of course, that also means that these people will pay more state and federal income tax. These things have a way of balancing out in the end.

The bottom line is that Newt Gingrich knows that this is irrelevant. Newt would be campaigning against government waste and another inefficient entitlement program if the subsidies were calculated differently. It is just a sleight of hand.

We should, by now, be used to this from our politicians. Sometimes it is a mental misdirect. Sometimes it is a misstatement. And there are other instances when the politician tells the truth, technically, but what he/she said and what we heard are not even closely the same.

Example? My favorite is “If you like your policy, you can keep it. Period”. Balderdash.

I wasn’t in the room when the President and his advisors crafted that perfect slogan. “If you like your policy, you can keep it. Period.” So clear. So emphatic. So wrong. Did the President and his advisors intentionally mislead the country, or more likely, did we have a room full of people who had no idea what they were talking about?
  • Over 80% of Americans get their insurance coverage through work. If you are one of them, you don’t choose your plan, your employer does. It is not up to you.
  • Only policies on the books prior to the passage of the law and unchanged since that day, March 23, 2010, are grandfathered.
  • How long can the insurers run two separate sets of books? Policies issued prior to March 2010 have one set of rules while new policies have another. Who pays the additional cost to maintain the old contracts and monitor compliance?
This blog has tackled the grandfather issue repeatedly since August 2, 2010’s, Don’t Cry Uncle, Stay Grandfathered. Retroactive rules. Contradictory edicts. Those of us who actually work in the insurance business knew that we would see very few individual or small group policies limp across the finish line on January 1, 2014.

The President is shocked that many Americans are now losing their current policies and being forced into new, more expensive contracts.

There are some awful policies on the market that will disappear on January 1st. There are some policies that have a $25,000 or $50,000 cap. Those plans were cheap, but they did not really cover a major illness. However, about 11 million Americans are covered by comprehensive policies that will be cancelled in the next twelve months. These plans don’t conform to the new rules.

My policy is scheduled to end a year from now. Why? Because it doesn’t cover me for maternity. If nothing changes in the next twelve months, my premium will more than double next December. Of course I like my policy. And no, I can’t keep it.

The Patient Protection and Affordable Care Act (PPACA) will, eventually, help many Americans. But it would be foolish to dismiss out of hand those people who are angry or upset. You can’t just bury their fears with the survivors.

DAVE

Picture from the Passen Law Group www.passenlaw.com