The Tip of the Healthcare.gov Iceberg

October 28, 2013 - 2:51 PM

Glitches on the Obamacare web site left people unable to purchase insurance despite hours or days of trying.  But that's just the tip of the iceberg. The website also dramatically understates health insurance costs, note CBS News and Jeff Dunetz in a column yesterday:

"CBS News has investigated the new feature at Healthcare.gov which allows consumers to see the offered insurance plans without registering. Its reporters found that the pricing displayed dramatically underestimates the actual cost of the plans.

"According to CBS, the new 'shop and browse' feature often comes with the wrong price tags. One example is how the website lumps people only into two broad categories: "49 or under" and '50 or older.'

"Jonathan Wu is co-founder of Valuepenguin.com, a consumer finance website focusing on the impact of health care reform. His company has built a tool that provides quotes for plans on the federal exchange. He said it's 'incredibly misleading for people that are trying to get a sense of what they're paying.'

"Prices for everyone in the 49-or-under group are based on what a 27-year-old would pay. In the 50-or-older group, prices are based on what a 50-year-old would pay.

"CBS News ran the numbers for a 48-year-old in Charlotte, N.C., ineligible for subsidies. According to HealthCare.gov, she would pay $231 a month, but the actual plan on Blue Cross and Blue Shield of North Carolina's website costs $360, more than 50 percent higher. . .A 62-year-old in Charlotte looking for the same basic plan would get a price estimate on the government website of $394. The actual price is $634.

"Compounding the problem is that Healthcare.gov constantly tells the consumer the actual prices could be lower, but it makes no mention that they could be higher."

Health insurance cancellation notices caused by the Obamacare law remain far more numerous than enrollments in its health insurance exchangesreports the Daily Caller:

"Hundreds of thousands of Americans who purchase their own health insurance have received cancellation notices since August because the plans do not meet Obamacare's requirements. The number of cancellation notices greatly exceed the number of Obamacare enrollees. Insurance carrier Florida Blue sent out 300,000 cancellation notices, or 80 percent of the entire state's individual coverage policies, Kaiser Health News reports. California's Kaiser Permanente canceled 160,000 plans - half of its insurance plans in the state - while Blue Shield of California sent 119,000 notices in mid-September alone."

At Fortune, health care analyst Avik Roy argues that "Obamacare's web site is crashing because it doesn't want you to know health plans' true costs":

"The Healthcare.gov website requires that individuals looking for coverage enter personal information before comparing plans. IT experts believe that this requirement is causing the website to crash.

"A growing consensus of IT experts, outside and inside the government, have figured out a principal reason why the website for Obamacare's federally-sponsored insurance exchange is crashing. Healthcare.gov forces you to create an account and enter detailed personal information before you can start shopping. This, in turn, creates a massive traffic bottleneck, as the government verifies your information and decides whether or not you're eligible for subsidies. HHS bureaucrats knew this would make the website run more slowly. But they were more afraid that letting people see the underlying cost of Obamacare's insurance plans would scare people away.

"HHS didn't want users to see Obamacare's true costs."

The federal government foolishly did not have the malfunctioning web site properly tested before use. As Doug Powers notes, "The website has been such a train wreck that people have been advised to call the phone number" for Obamacare "instead (which they made fairly easy to remember)." "So what happened when one reporter called the phone number? You guessed it:" The operator just told the reporter to go back and use the web site previously found to be unusable.

Massive marriage penalties and work disincentives are built into the tax credits subsidizing policies on the Obamacare insurance exchanges. Other provisions of the law have reduced hiring and resulted in employers replacing full-time employees with part-time workers. Unions that once backed Obamacare are now pleading for changes to the law, citing lost wages and benefits. Obamacare's medical-device tax caused layoffs in the medical device industry, as even liberal Senators like Al Franken (D-Minn.) have conceded. Doctors have said that Obamacare is "bad for your health," and that due to Obamacare's medical-device tax, "venture capital investment in medical devices has all but ceased," which will have a "devastating" effect on medical innovation.