Case Study: Mitt Romney and his state’s healthcare plan…

The Economist has done some short-term studies on how the universal healthcare plan has gone. By the end of December all citizens had to have signed up for some sort of healthcare or be fined.

The Economist breaks down the critics and what is happening…

First, critics believed that the $220 dollar penalty was not big enough and wouldn’t make the healthcare plan "universal."

Good News is that the state is reporting 300,000 citizens have already signed up. This is about half of the people that were uninsured.

Bad News is that most of the poor is in this number and their healthcare is subsidized. Which means that the people who work and pay those taxes haven’t quite achieved the benefits.

Second, critics believed that employers would start dropping coverage and it would "crowd out" the private sector.

Good News is that a poll shows only 3% stopped coverage.

The problem starts is when we talk about the cost of coverage.

The idea is that the government can beg, bully, and badger the companies to keep prices low. The problem is that Jonathan Gruber who is a MIT professor that came up with the reform plan believes that premiums will rise 10-12% in the next year.

The subsidies are not able to keep up. As costs continue they are reporting that if the costs go up the state will not be able to to afford this scheme.

I am very skeptical of any program the makes people do anything. This could turn into a social security problem. Where people will not pay enough in and as the population grows it will not be able to sustain itself.

Only time will tell…

Published in: on January 5, 2008 at 5:35 am  Comments (1)  

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  1. If a government taxes are designated to pay for universal health-care, it seems like the only mechanism limiting the cost would be increasing taxes and competition between private health industries (and I seriously doubt either will work for the long-term). If a state or even the federal government can’t limit the cost of a universal care system naturally, how can it succeed in the long term?

    It’s obvious that the middle class are in a health crisis, and that a universal system advertises a glamorous “Michal Moore” style fix, but considering the long-term situation, recently proposed systems seem unrealistic.

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