Obamacare: An Insurance Agent's Perspective . . . if anyone in D.C. cares

Not that anyone really cares what a lowly insurance agent thinks about the President’s plan to fundamentally reform one of the single largest industries in the United States, one that provides nearly 14 million jobs for Americans, but here it goes.

Allow me to state my vested interest up front.I sell health insurance to groups and individuals. Health insurance is not the sole source of revenue for my insurance agency, indeed it accounts for about 10% of the agency’s annual revenue.But, 10% is not chump change either.Given what is happening in Washington, D.C., I guess I'm glad it is only 10%.

Does this mean I am biased? Maybe. But, please let my arguments stand or fall on their own merits. I like to think, that after decades in the business, I actually know something about health insurance. How many of the politicians holding our collective fates in their hands know much about health insurance?

I'm not going to waste time telling you how great our health insurance or health care system is. It is far from perfect. There is much within it that could use improvement. Visit an emergency room lately? Ever get “balance billed” by a provider for “out of network” charges you did not approve? If so, you know that ours is not a perfect system.

But, you don’t fix an overflowing toilet or even a cracked foundation in your home with gasoline and a match.

Make no mistake, Obamacare will torch our current system of health care and health insurance. This is no modest reform.

Contrary to President Obama’s repeated attempts to assure those of us pleased with our current health insurance arrangement that “you will keep your plan,” this is simply not the case.

President Obama’s plan will introduce a “public option” that will “compete” with private plans. This all sounds nice and market-based until you realize that the public option is going to be subsidized with your tax dollars. It will “compete” only in the sense that it will always be cheaper than what you can obtain on the private market. Because private health insurers are bound by the market constraints of profit-making, cost containment, supply and demand, etc. The federal government knows no such bounds.

A Heritage Foundation study released on July 17, 2009, has reported that the premiums under the public plan will run 20 to 25 percent less than the average private plan. Will the government turn a profit on this plan? They don’t care because the rules you and I operate under will not apply to them.

In my experience as an insurance agent, the number of customers (for group and individual insurance) who will not move their insurance for a 20 to 25% savings is zero. The fact that you personally like your plan will not matter, your employer (who is subject to the market rules of profit-making, cost containment, supply and demand, etc.) will make the decision for you. The study confirms this, estimating that coverage under private insurance will decline by 83.4 million people, or 48.4 percent.

How will what remains of the private insurance market be able to handle such a loss of premium dollars? Who knows? If these markets survive they will be in no position to offer premium savings. My guess is that it will be crippling for the private insurance market. To the extent it still exists five years after implementation, it will be a specialty market where only the very healthy and/or very wealthy need apply.

The Obamacare plan will not “save” money as the Administration claims. This is a pretty big whopper that the President keeps on telling. The latest Congressional Budget Office estimates put the price tag at over $1 Trillion even without the costs of the “public option” or all the Medicaid expansions the Democrats want.You cannot take 83.4 million people who were previously privately insured plus 32.6 million people who were not buying insurance before and SAVE money. You have to work inside the D.C. Beltway to miss that fundamental fact.

There is a limit to what we can, as taxpayers, afford to spend on health care, especially when you consider the crushing debt we are already incurring as a result of our entitlement spending, bank bailouts, auto bailouts, etc. With Obamacare, we will see those limits in the doctor’s office, the hospital room, or the ER. Choices will be circumscribed in the name of efficiency and cost control. To be sure, insurance carriers have been engaging in these sorts of cost controlling methods for years.

You probably know someone who became so upset with the charges that an insurance carrier was willing to pay for and not pay for, that they changed their insurance coverage. I know plenty of people like that. But, once the government that is making those decisions for you, where are you going to go?

So, taken all together, we have devastation of the private insurance market, a brand new government entitlement for 129.6 million people, and government oversight over patient/physician decisions about care.

Please America, do not do this!


yes, i agree with you, and i in NO WAY want ObammyCare, but the FACT is ALL of our 'representitives' are lobbied, and in fact, bought, by lobbyists, both dem and repub, and at this point insurance companies and the government are already largely in bed with each other ( as is the case in many industries )...how can we have reform until we kick the lobbyists for insurance companies out of our elected politicians offices?  i don't want to see the horror of rationing of healthcare via an artificial method ( i prefer to see real competition in the healthcare market ), but i can ASSURE any and all who read think and study the issue, the LAST thing insurance companies want to see is free market competition.  if insurance companies were not so dirty, and so in bed already with the government, there would not be the window of opportunity that obammy is going to try to exploit to get his single payer nightmare into the U.S.  ugly ugly players on both sides if you ask me.

Mr. Logical - 

So I guess you agree with Speaker Pelosi that insurance carriers are the villains here?

I happen to work with Norman Adams (he's my Dad) trying to wickedly profit from -gasp- selling insurance products!  Look, I am the last person to try to make anyone feel sorry for insurance companies.  Their incompetence and ridiculous behavior is one reason people need insurance agents thank goodness!

In spite of their problems, they still pay for quality healthcare for millions of Americans.  They compete everyday.  I see it.  I can testify to it.  

Putting the government in charge of health insurance is not something the health insurers want.  To be sure, they will try to survive in such a climate just like you and I will.  Obamacare has to be stopped.  All other complaints are side issues right now!



...this sentence in the MIDDLE of my post: "i don't want to see the horror of rationing of healthcare via an artificial method ( i prefer to see real competition in the healthcare market )" so, i have no clue what you are saying...you might check this sentence out from todays article "Big Business Goes Big for Health-Care Reform" by john stossel- (Hardly a raving liberal ) "It illustrates economist Steven Horwitz's First Law of Political Economy: "No one hates capitalism more than capitalists". In this case, big business wants to shape -- and profit from -- what inevitably will be an interventionist health-care reform. Can you think of the last time a major business supported a truly free market in anything?" it is refreshing, although rare, when the truth hits the media, but for an education in the corruption of anti competition corporatists and businesses, you might want to read his article, it is on the real clear politics website today. again, i really have no idea what you are saying here but my solution? ( although unsolicited ) 1. DIVORCE business and government from each other, NO MORE Subsidizing big business ( by sluffing off costs to the American middle class, and taking all the profit - case in point, illegal immigration ). 2. NO MORE employers being forced to pay for employees healthcare, open it up, to FREE MARKET COMPETITION by the American citizens. People get healthcare for themselves and their families, their employer should have NOTHING to do with it ( dirty little secret here, employers want to be involved, because they run actuarial tables based on physicals, age, etc etc etc etc ) too bad, get the business away from the buying healthcare end of things. 3. Come up with a mechanism to FORCE people to participate in preventive health care, yes it will make the medical industry, or many of them anyway, very irritated. If your medical doc tells you to quit drinking 8 bourbons a day, and no more triple big macs before bedtime, and you don't obey the doc, well then, no open heart surgery for you later on. ( and DON'T EVEN try and twist what I am saying - NOT gonna accept that, the issue should be between the doctor and the patient, unless the patient demonstrates a lack of functioning brain cells - my doc tells me to excercise, I excercise, he tells me to cut down on salt, i cut down on salt, he tells me eat more fruits and veggies, i eat more fruit and veggies - people must be made to take the advice of a doctor. 4. Get the insurance lobbyists out of the politicians offices. Insurance companies must be made to reform in some manner.

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