The "Obamacare Shock" - One California Employer's Terrifying True Story

Tyler Durden's picture




 

From a Zero Hedge reader:

My company, based in California, employs 600. We used to insure about 250 of our employees. The rest opted out. The company paid 50% of their premiums for about $750,000/yr. 

 

Under obamacare, none can opt out without penalty, and the rates are double or triple, depending upon the plan. Our 750k for 250 employees is going to $2 million per year for 600 employees.

 

By mandate, we have to pay 91.5% of the premium or more up from the 50% we used to pay.

 

Our employees share of the premium goes from $7/week for the cheapest plan to $30/week. 95% of my employees were on that plan.  Remember, we used to pay 50% now we pay 91.5% and the premiums still go up that much!!

 

The  cheapest plan now has a deductible of $6350! Before it was $150. Employees making $9 to $10/hr, have to pay $30/wk and have a $6350 deductible!!! What!!!!

 

They can't afford that to be sure. Obamacare will kill their propensity to seek medical care. More money for less care? How does that help them?

 

Here is the craziest part. Employees who qualify for mediCAL (the California version of Medicare), which is most of my employees, will automatically be enrolled in the Federal SNAP program. They cannot opt out. They cannot decline. They will be automatically enrolled in the Federal food stamp program based upon their level of Obamacare qualification. Remember, these people work full time, living in a small town in California. They are not seeking assistance. It all seems like a joke. How can this be the new system?

 

Pelosi, pass the bill to find out what's in it? Surprise! You've annihilated the working class.

Q.E.D.

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Wed, 11/20/2013 - 13:59 | 4173979 12ToothAssassin
12ToothAssassin's picture

The Shocker, bitchez

Wed, 11/20/2013 - 14:02 | 4173993 Skateboarder
Skateboarder's picture

What the fuck!!! This is such a sick and nasty society we live in. They should sue the government for rape charges.

Wed, 11/20/2013 - 14:08 | 4174029 Peter Pan
Peter Pan's picture

"Pelosi said pass the bill to find out what's in it."

As someone recently remarked, it sounds like a stool sample."

Wed, 11/20/2013 - 14:15 | 4174068 TeamDepends
TeamDepends's picture

Just dessert for the CA progressives who voted for this shit!  For the rest of you, it was time to leave several years ago.

Wed, 11/20/2013 - 14:19 | 4174107 rcintc
rcintc's picture

Pellosi knew exactly what was in it...This is all done by design

Wed, 11/20/2013 - 14:23 | 4174137 Say What Again
Say What Again's picture

Pellosi is front running the laws she advocates and/or passes.  That bitch needs to be removed from office.

Wed, 11/20/2013 - 14:32 | 4174155 TeamDepends
TeamDepends's picture

  Haha!!!! It keeps getting worse for them.  We're lovin' it!!!!!http://theulstermanreport.com/2013/11/20/obamacare-website-crashes-durin...

Wed, 11/20/2013 - 14:46 | 4174256 RSloane
RSloane's picture

Lol I saw that.  Of course right off the bat some dweeb remarks that it only keeps crashing because its so popular! People love it even though they can't get to it to assess the damage. Could you see Amazon running on that principle? They can't sell anything because its too popular?

Hell, they should have put the exchanges on the AH in WoW. At least Blizzard knows how to run a server.

Wed, 11/20/2013 - 15:00 | 4174332 King_of_simpletons
King_of_simpletons's picture

Good luck to all who are getting the rod up their arses.
Sorry but we all saw this coming, enjoy poverty.

Wed, 11/20/2013 - 15:48 | 4174615 Lost My Shorts
Lost My Shorts's picture

I am a confused sort of guy today.  The California business guy says most of his employees qualify for MediCal (the California version of Medicaid) so why do they need insurance?  Is part of Obamacare that employed people must now pay a little bit for their Medicaid, and Medicaid now has a deductible of nearly $7K?

It sounds like the California business guy is now required to pay $3,300 per worker (whose cash comp is just short of $20K) so that is a significant increase in the guy's employee comp expenses, and he would be normal to complain.  But the federal taxpayer must be picking up an even bigger chunk.  And before Obamacare, most of his employees (the opt-outs) were probably on MediCal paid for by the California taxpayers.  So the net effect seems to be shifting cost from California taxpayers to the employer and federal taxpayers.  But too confusing to really understand what is going on there.

Must separate the issues:

1) Obamacare policies are crazy expensive, which reflects our religious devotion to insurance company profits plus the crazy high price of medical care in America.  Check.  Roger that.

2) How much should an employer of low-wage workers contribute to their medical care, vs. pushing the cost onto California and federal taxpayers via MediCal?  This is a familiar issue that comes up with Walmart a lot.  Is it really a great thing if the taxpayers subsidize this business by covering the health expenses of his low-wage employees? (Or let no one pay and they are just denied access to healthcare?)

3) These workers all belong to the 47%, yes that 47%, the one the Mittster and all the rest of you can't stand because they don't pay taxes.  If they now must contribute $1,500 per year to the cost of their healthcare, taking some of the burden off taxpayers, isn't that what you all want?  Doesn't that reduce their takerness?  Even aside from the clusterfrog of Obamacare, average medical expenses for a family would exceed $1,500 per year.  Why shouldn't they pay that?

Just askin.  Amid the anti-Obamacare firestorm, there seems to be very little actual clear thinking about the issues of healthcare in America.

 

Wed, 11/20/2013 - 15:49 | 4174640 Wahooo
Wahooo's picture

 

"By mandate, we have to pay 91.5% of the premium or more up from the 50% we used to pay."

If this is true, there is not a single company in America that will provide healthcare coverage. When does this part of it kick in?

Wed, 11/20/2013 - 16:47 | 4174943 SMG
Wed, 11/20/2013 - 17:36 | 4175149 Wahooo
Wahooo's picture

I liked the original Tron when it first came out. Leave it to obama to fuck that up, too.

Wed, 11/20/2013 - 22:28 | 4176094 markmotive
markmotive's picture

"Government without painkillers"

http://www.planbeconomics.com/2013/11/the-obamacare-extension-government...

Is Obama truly trying to destroy the American middle class?

Wed, 11/20/2013 - 23:06 | 4176200 TwoShortPlanks
TwoShortPlanks's picture

The hidden agenda of Obamacare.

USSA: Emergence of a Socialist State

http://twoshortplanksunplugged.blogspot.com.au/2013/11/ussa-emergence-of-socialist-state_20.html

 

Thu, 11/21/2013 - 03:40 | 4176598 boogerbently
boogerbently's picture

Latest news is healthcaare spending is down. The dems are trying to take credit for it, via obamacare.

Obamacare isn't even up yet.

Healthcare spending is down because 10's of millions of policy holders were cancelled, full time workers were reduced to part time unbenefitted, which IS due to obamacare.

Thu, 11/21/2013 - 01:50 | 4176524 PT
PT's picture

SMG:  Lol.  Thanks for that.  And if you hadn't have shown me that, I never would have seen this:

http://www.theonion.com/articles/buddhist-extremist-cell-vows-to-unleash-tranquilit,34623/ 

Wed, 11/20/2013 - 19:13 | 4175417 californiagirl
californiagirl's picture

"there is not a single company in America that will provide healthcare coverage"

That was the intent of Obamacare - discourage employers to drop private insurance.  As private enrollment declines and more and more insurance companies go out of business over the coming years, the government will eventually force the rest onto Obamacare.  I suspect Medicare and Medicaid will also eventually merge with Obamacare to the single-payer, limited-choice Obamacare plan.

For my little Silicon Valley company, the lowest monthly premium is $533 per month, up to $1,998/mo, with a $500-individual, $1,000-family deductible and employees have to contribute 20% of their individual premium, 50% of dependents.  I used to cover 100% of the premium for individuals, 60% for dependents, but the prices have gone up so much in the past that I had to change it a couple of years ago.  I stuck with the plan to grandfather it.  However, I am not sure how many more years the company can continue to provide insurance.  Paying the penalty is so much less.  The employees had sticker shock.  They had no idea how much the company was paying on their behalf.

 

Wed, 11/20/2013 - 19:23 | 4175445 nmewn
nmewn's picture

All going according to plan.

Stretching peoples necks is in my plan.

Wed, 11/20/2013 - 19:42 | 4175520 new game
new game's picture

and those muscles that control bowel movement; relax this might even feel good; i said i was with the gub and here to help you.

obviously opting out, and haven't had insurance for over 3 years. now some fucking penalty for being a citizen. I will be just using some of that 500/ month savings by not being on my wifes plan. for what its worth the whole crux of qualifying(for my situation) is "can you be insured under a private  plan?" well from there, making a whole wopping 12.50/hour, semi retired put me in a must opt out and pay the penalty.

What country are we in?

Wed, 11/20/2013 - 21:50 | 4175979 Blue Boat
Blue Boat's picture

So, new game -- or anyone else with info, what I don't hear anyone anywhere speak about is: if you get in a bad accident or stricken with a disease -- do you not consider that you may get financially wiped out for the needed medical care?

That's the thing. People behave as if -- what the hell, I'll just opt out and pay the penalty.

Uhmm, there's a pretty big risk attached to that choice that no one seems to speak of.

What gives?

Wed, 11/20/2013 - 22:23 | 4176084 nmewn
nmewn's picture

Its called "catastrophic health insurance" and I believe you can still get it...until someone finds another part of "the law" (that no one read before passing) or the regulation derived from it, that prohibits it.

Or Obama declines to enforce it as "the law" cuz...ya know, he thinks he's King or sumpin.

Wed, 11/20/2013 - 22:43 | 4176147 JLee2027
JLee2027's picture

One of the worst debacles in the history of American Government and Obama hasn't fired a single person. Says it all.

Wed, 11/20/2013 - 22:53 | 4176174 FEDbuster
FEDbuster's picture

Wrong, the catastrophic plans are the ones being canceled.  They don't meet Obamacare's minimum standards of coverage.  Now they are trying to backpeddle and reinstate those policies, but the insurance companies were glad to be "forced" to cancel them. 

"It's all bullshit, and it's bad for ya!" George Carlin

Wed, 11/20/2013 - 23:13 | 4176223 nmewn
nmewn's picture

"...until someone finds another part of "the law" (that no one read before passing) or the regulation derived from it, that prohibits it."

Yes, covered it...my Carlin favorite:

"I'm tired of these self-righteous...these white, bourgeois liberals who think the only thing wrong with this country is there aren't enough bicycle paths. People trying to make the world safe for their Volvos."

And...here we are, more insurance for their Volvos ;-)

Thu, 11/21/2013 - 00:01 | 4176347 Squid-puppets a...
Squid-puppets a-go-go's picture

they should instate some kind of constitutional provision that bills before congress be a maximum of 50 pages at 10pt type

these bullshit 2000 page tomes with all sorts of provisions for totally unrelated topics render even the best intended congressman utterly ineffective

Thu, 11/21/2013 - 00:45 | 4176438 joeknows
joeknows's picture

Bad accident? Like at work (workers comp) like getting hit by a car (auto liability insurance) fall down stairs (property liability insurance).  What other than cancer or some random crazy disease wouldn't be covered by other types of insurance?  You fools make me laugh.  We got insurance comming out of our asses for a fart that might come out crooked and knock the old lady down the stairs.  Your telling me we need medical insurance incase of a "bad accident"  what "bad accident" isn't covered with a law suit?  waiting.........crickets...........

Thu, 11/21/2013 - 06:52 | 4176691 FredFlintstone
FredFlintstone's picture

That argument always rubbed me the wrong way. Most Americans have almost zero net worth and this fact I am sure is more representative of the 50M people who did not have health insurance. Besides a small sliver of the population that had assests and were locked out of the market due to pre-existing conditions, who does all of this help? Somebody gets sick and loses their $1,800 life savings? We have to upend everything?

Many of the 50M did not have insurance because it did not make economic sense. From the news coming out, having insurance may not make economic sense to even more people due to the high cost of this "affordable" insurance. 

Thu, 11/21/2013 - 15:00 | 4178362 Blue Boat
Blue Boat's picture
@joeknows - you make some valid points but they are not as simple as you state. Auto policies have lowish medical coverage; it could be a pittance relative to what treatment costs might be.

Lawsuits? Ok, yeah...maybe. But, hello....where is the guarantee that will work in your favor? Depending on the situation, YOU may have to upfront the attorney fees and take the risk that you don't win the case and all the $$ invested in the lawyer are out of YOUR pocket. Oh and, it will surely take a long time and be extremely stress-inducing. Not so simple.

 

@FredFlintstone - It was implicit that I was referring to people that DO have assets. I'm in my 50's and almost everyone I know has some actual net worth. Large 401k's and/or other investment accounts, homes owned free and clear...and these are middle class types. People with average incomes but a NET worth of 250K - 750K, because they lived within their means and made some decent choices. 


So, we're supposed to just suck it up and pay these exhorbitant premium increases; even though we're not sick and live fairly healthy lives? Is that it?  I haven't been to the doctor for anything other than physical exams in 8 years. I have no reason at present to believe the near future will be any different for me. So, I should be fine with paying $5500 a year in 2014 for my health plan (a 70% increase!)?  At that rate it would be 55K over the next decade and I'm likely to incur costs to the plan of $2500-3000 during that time for annual exams.  


So, yeah it's a dilemma. Because if that bad thing does happen, it could financially devastate you at a time in your life when you don't have decades to recoup. I have no doubt there are several million people in this dilemma, Fred.

  
Wed, 11/20/2013 - 20:39 | 4175739 wee-weed up
wee-weed up's picture

Obama lied... Health care died.

Wed, 11/20/2013 - 22:27 | 4176092 James-Morrison
James-Morrison's picture

Obamacare is brilliantly evil.

It is so fucked-up, the red team hates it, the blue team hates it, citizens hate it. Who did I leave off?

The insurance companies love it.

Brilliant.

Wed, 11/20/2013 - 21:22 | 4175876 sgorem
sgorem's picture

I'm on your train of thought too. Hang 'em high. How many people will DIE from this fucking abortion before the rest of us do something to restore some semblance of sanity to our Republic?

Wed, 11/20/2013 - 22:40 | 4176137 The Burning Planet
The Burning Planet's picture

My prediction is ACA will be repealed, by ConCon. But only after incredible pain and suffering, and civil unrest.

Wed, 11/20/2013 - 15:50 | 4174645 azzhatter
azzhatter's picture

And that's because the entire focus is on who  pays the bill and not the size of the bill to begin with. Healthcare costs are probably 75% higher than need be due to the cartels in the healthcare trade.

Wed, 11/20/2013 - 16:53 | 4174971 Diogenes
Diogenes's picture

More like 90%. There are private hospitals that will treat you for 1/10 the so called going rate. Insurance companies routinely pay 1/10 what they charge uninsured patients.

Wed, 11/20/2013 - 19:57 | 4175595 new game
new game's picture

call bullshit-1/10 not so. just (not insured) paid for the hospistal portion of a hernia surgery and insurancevwould have paid about 2.5 times high than 1/2 down and  balance in 90 days.

just sayin.

max scam

please someone, find some sanity in all this.

all i want is an open fair marketplace w/o the fucking gov.dickupass

Wed, 11/20/2013 - 19:25 | 4175455 bunzbunzbunz
bunzbunzbunz's picture

<----- Bunz is a shameless prick

<----- I want to diversify my SHTF fund with free bitcoins: http://freebitco.in/?r=25727

Wed, 11/20/2013 - 19:51 | 4175562 infinity8
infinity8's picture

That is exactly right in every way! Why did I think, in younger years, when I would hear some politician's gums flap about reforming healthcare, that they might be talking about this issue (size of bill)? LOL - Look, over there! It's Elvis!!

Thu, 11/21/2013 - 00:14 | 4176371 infinity8
infinity8's picture

Well and, fuck me. I didn't notice I'd pop up under "bunz". Bunz, I'd probably be with you if I didn't think you had Tourette's or something like it..? Good luck, Fucker (I said with a capital "F" out of ((a little)) respect for your fortitude.

Wed, 11/20/2013 - 21:04 | 4175821 Crash Overide
Crash Overide's picture

What did someone say the other day... "Socialism works until you run out of other peoples money." lol

Wed, 11/20/2013 - 21:53 | 4175990 DanDaley
DanDaley's picture

The problemn with socialism is that eventually you run out of other people's money.  Margaret Thatcher

Thu, 11/21/2013 - 00:06 | 4176358 Squid-puppets a...
Squid-puppets a-go-go's picture

so so true. but how do you stop capitalism morphing into crony capitalism morphing into socialism

its like you can watch george orwell's Animal farm in reverse and it still makes perfect sense

 

Wed, 11/20/2013 - 22:46 | 4176155 CheapBastard
CheapBastard's picture
Obamacare may need a taxpayer bailout: Ex-HHS head

 

http://www.cnbc.com/id/101210207

Wed, 11/20/2013 - 21:47 | 4175969 Stuck on Zero
Stuck on Zero's picture

If the government can force Americans to pay for a plan they don't want then it can easily force Doctors, plan CEOs, and HMO heads to accept no higher pay than $150K a year. 

 

Wed, 11/20/2013 - 22:41 | 4176143 nmewn
nmewn's picture

I'm sure the doctors forced into wage controls, remaining in that system, will give everyone the care they are paid for ;-)

But yeah, the big problem is administrative/corporate/regulatory costs...I think everyone can see that...anything over twenty five cents for an aspirin is fraud/theft.

Wed, 11/20/2013 - 22:52 | 4176168 CheapBastard
CheapBastard's picture

True dat. I remember going with my friend to his doctor's office for something. The Doc had his waiting room slit into two areas by a wall.

On the HMO side it was smelly, dark, dirty carpet, cold, etc and you waited for a loooong time.

On the non-HMO side there was mahogeny wood floors, soft muzak, coffee, various magazines, and a sweet nurse who went around asking if you need anything and you quickly seen by the Doc.

I see more of this style of practice coming.

Wed, 11/20/2013 - 16:51 | 4174964 Zymurguy
Zymurguy's picture

1) - You do understand the insurance corporations have been in bed with congress for over a century?  Congress has allowed them to operate in what is essentially 50 different mini-monopolies.  Full, open competition and less govt. intervention could have corrected this a long time ago.  In modern times they've queered the deal by allowing insurance companies and their lawyers to really fuck up healthcare.

2) - None (see "1" above) Given enough competition and a variety of insurance plans, people can choose the plan that suits their needs and personal economics.  If some form of assistance is required, well, we already have that in place.

3) - The problem is they WON'T be able to pay that... not after they, along with millions like them, have their work hours reduced so the business they work for can cut costs.  They will make a choice like so many on fixed incomes that end up choosing between thigns like food vs. heat... or food vs. medication.  No one is going to see a reduction in their taxes - what fucking fantasy land do you live in?  You want to fix the problem, fix the core of the problem... too much govt. intervention from a govt. that is WAY too large and bloated with agencies, bureaus and financial commitment is the problem.

Look, show me some situation in the past 200 years where the government grew, created a new agency or bureau and the country became financially more sound, we saw less taxes and the discretionary income of the middle class increased.  It's bad enough that our currency has been usurped by a vile central banking cartel but we must also be under constant attack from our govt. trying to extract as much of it from us at every moment that currency makes a move in our life (income, sales tax, etc.)

Wed, 11/20/2013 - 20:24 | 4175692 DaveyJones
DaveyJones's picture

don't forget drug companies too. That industry has come on like a mother and spends a ton for their prostitutes on the hill. We do not buy our medicine on the open market where we could pay massively less.

Remember, just like Cheney's oil meetings, this "open administration" had lots of secret meetings with both industries and by amazing coincidence not only do both industry giants (and only the giants) NOT take a hit (like the rest of us) they gain profit, get legally ordered customers who pay them or pay a fine, they lower competition, and help enact a law so unconsitutional that the Supreme Court had to relabel it a "tax" to make it pass legal muster.

No matter WHERE you sit in the medical debate - single payer, clear open compeition, or anywhere else - this thing is a corrupt and insane piece of shit that makes no medical sense, no fiscal sense, no free market sense and is a "banker" bailout for two industries that don't even need one.

NOTE TO ANGER: I think I posted this already but my solo law practice plan (for six family members) went up fifty percent on the medical and 100 percent on the dental.  

    

Wed, 11/20/2013 - 16:55 | 4174979 Binko
Binko's picture

People on forums like this don't have any answers for the questions you are asking.

I've concluded that a large number of posters would be perfectly happy to simply let the 50% of the public making low or minimum wage starve in the street or die from lack of access to simple healthcare. They would be perfectly content to stride through a horde of starving children just like they do in India or Mexico as long as their privileged position is secure. 

Wed, 11/20/2013 - 17:27 | 4175115 grouchist
grouchist's picture

I was with you until "Mexico".  True there are a lot of problems there but Mexico is a country (a) with no social safety net, (b) that has working, afforable health-care that working-class Mexicans can use.  In Mexico if you fall nobody is there to catch you or give you an EBT card (modulo full-court press "democracy" of the kind that Peña-Nieto plays), however if you break your leg or are ill and go to hospital you won't be turned away. Even if you're a foreigner with no money. Mexican doctors seem to actually have heard of this Hippocrates guy, too. I guess barbaric customs like oaths have fallen out of favor in the developed world and anyway do no harm is clearly bad for business... a little harm goes a long way on the bottom line if you're an insurance company, one way or another.

If you're looking for answers why not try the real world... you know, the one across the border from LaLaLand?

Do NOT follow this link or you will be banned from the site!