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usmcpgw Wrote: Jan 07, 2013 5:37 PM
Imagine, for a moment, that Fred and Jane each have a credit card from a different bank. Fred charges $5,000 a month, and Jane charges $1,000 a month. Suppose it costs each bank $5 to produce and send a plastic credit card when the account is opened. That $5 "administrative cost" is a much lower percentage of Fred's monthly charges than it is of Jane's, but that does not mean Fred's bank is more efficient. It is purely a mathematical artifact of Fred's charging pattern, and it would be silly to compare the efficiency of bank operations on that basis. Yet that is how many analysts compare Medicare with private insurance.
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I was tempted to roll out one of our sarcastic "surprise" headlines for this post, but nothing about this law is surprising anymore. Over and over again, conservatives' admonitions and predictions -- ranging from premium levels to cost curves to basic logistics -- have been vindicated by events. We already knew that individual and family premiums were on the rise thanks to the president's signature law; the New York Times now reports that the government is forcing insurance companies to reach into citizens' pockets and extract up to hundreds of additional dollars per month for healthcare:
Report: Obamacare Triggering Double Digit Premium Increases