Tuesday, November 30, 2010

ObamaCare's unlikely victim

Perhaps you have to be familiar with New York politics to understand how truly bizarre this story is: 1199 is dropping its health care coverage for children. 1199 is the extraordinarily powerful local health care workers' union which has pushed New York State's Medicaid reimbursements into the stratosphere.

Naturally, 1199--and its national parent--were a powerful force advocating for a national health care program. An article on their website from June speaks approvingly of PPACA as a "first step", though also complains that it didn't go far enough in creating a public option.

That article also says that "1199ers in the major health funds such as the 1199SEIU National Benefit Fund (NBF) should see little or no change in their coverage." Just a few months later, the Journal is reporting that the SEIU is dropping its coverage for children, citing, among other things, the impact of the new healthcare law...
"In addition, new federal health-care reform legislation requires plans with dependent coverage to expand that coverage up to age 26," Behroozi wrote in a letter to members Oct. 22. "Our limited resources are already stretched as far as possible, and meeting this new requirement would be financially impossible."
In fairness, this is not exclusively related to the new law; the union is complaining that the state has forced them to buy more expensive third party insurance, and the state is saying that they did no such thing, but that the union fund has been struggling with shortfalls for a while. Reading between the lines, it sounds like their self-insured health fund was underfunded, and the state told them they couldn't keep operating that way. When the budget scramble began, ObamaCare was making coverage for children more expensive, so it ended up on the chopping block.

Nonetheless, this is an extraordinary thing to hear from the lips of one of the major advocates for national health care, and for generally higher spending on government health care. They're basically saying that the new law has made benefits more expensive, and that this is contributing to people cutting coverage--exactly the argument that opponents were derided for making during the debate.
--Megan McArdle, Atlantic Monthly, on the problem with gold-plated-or-nothing mandates

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