Part of the fight that led to the government shutdown was the extension of Obamacare subsidies. Not the original subsidies and tax credits but the 2020 expanded subsidies that were put in place by the Democrats and a few Republicans as a response to the pandemic. At least that was their excuse. Those subsidies were renewed in 2022 for three years, meaning they expire on December 31st of this year. Even though the pandemic is long gone, Democrats want to continue the payments. But who really benefited from the subsidies?
Taking the consumer out of the equation has led to high prices in almost everything that someone else pays on your behalf. Health insurance is no different. Obamacare was not really a way to help people get health insurance that couldn't afford it in the open market. In reality it was another mechanism by which politicians could funnel large amounts of money to their corporate donors. Only 24 million people are enrolled in Obamacare receiving either subsidized health insurance or premium tax credits.
Despite the relatively small number of beneficiaries of Obamacare, the federal government paid $1.73 trillion to health insurance companies in 2023 alone. Talk about a gravy train! If I were a health insurance company executive, I wouldn't want that subsidy to expire. In the meantime, premiums for health insurance policies in the private market have more than doubled and in many states like New Mexico they have tripled. Despite the fact that many health insurance companies will not write in lower population states or they have restricted the availability of PPO plans opting instead for the more controllable HMO plans.
In addition, several groups have found a tremendous amount of fraud in the Obamacare program. Paragon, Bloomberg, and the inspector general's office have found that unscrupulous insurance brokers enrolled people without their knowledge. They were paid huge commissions and insurance companies received premium subsidies from the government. They estimate that about 30% of the enrollees are fraudulent. Yet Congress and the federal government have been at best slow to investigate the fraud.
Don't get too excited about the fact that the Republicans made a big deal about not extending the subsidies. Speaker Johnson has already said that the subsidy issue will come up for a separate vote before the end of the year and he expects the expanded subsidies to be renewed. It's just politics as usual. Grandstand, promised the people what they want to hear, knowing it's a lie, then do what you were going to do anyway.
I don't know if it will ever change.
