Winners And Losers Of Obamacare Hooray!

In N Out Double Double BurgersIn a close 5-4 decision, the Supreme court says Congress was acting within its powers under the Constitution when it required Americans to carry health insurance or pay a penalty!

The legislation is 1,000 pages long so I can’t even come close to understanding all the nuances of the bill.  All I understand is that those against Obamacare think the bill is a violation of individual rights by our big bad federal government.  In addition to the perceived violation of human liberties, the question is who is going to pay for universal healthcare?

Those for Obamacare say that the legislation is not a violation of individual rights but only a tax on people who don’t have healthcare.  Justice Roberts explains, “The mandate is not a legal command to buy insurance. Rather, it makes going without insurance just another thing the government taxes, like buying gasoline or earning an income.”  I guess that makes sense.  The other reason for Obamacare is that in a country as rich as the USA, all people should be have health insurance, rich or poor.

LOTS OF UNINSURED

There are supposedly 32 million people in America without healthcare.  Some of them think they are healthy enough that they don’t need healthcare.  Meanwhile, the large majority of people who don’t have healthcare is because they can’t afford healthcare!  Hence, the irony is that if you penalize people who don’t have healthcare with a 1-2.5% extra income tax hike a year, you are essentially making the poor even poorer!  They are already annoyed the government is making them abide by more rules!

Meanwhile, payroll taxes for small businesses and income taxes for the wealthier population will go up to fund Obamacare because income tax hikes on the poor are not going to cover the cost of the program. Supposedly most of the 32 million people without healthcare will get partial or if not full subsidy by the government to get healthcare.  Of course that is not going to make the people who have to pay more taxes happy.

If the poor and rich and independent people of America are all pissed off about Obamacare, who is really happy the bill may pass besides President Obama and the people who serve him?  If you have health insurance or can’t afford health insurance you’re likely unaffected.  Those who are stuck in the middle now need to watch out for the encroaching Sentinels!

WINNERS AND LOSERS OF OBAMACARE

There is always a good side to everything.  You know that from reading my site for past several years that I am a super optimist.  As a result, here are the perceived winners and losers of Obamacare.

Winners

* Fast food industry.  Dunkin Donuts, McDonald’s, Burger King, In N’ Out Burger, etc.

* Medical device industry.  Johnson and Johnson, Medtronic, Cardinal Health, Baxter International are makers of stents, heart transplant equipment and other devices.

* Drug industry.  Cholesterol lowering drugs such as Liptor, Zocor, Crestor, Lovastatin, and Lescol are made by Pfizer, Merk, Dr. Reddy’s and more.

* American car makers e.g.  Ford, General Motors.

* Waste Management companies.

* Small businesses owners of cupcakes, BBQ, gourmet burgers, and gourmet ice cream.

* People who hate working out.

* Folks who appreciate delicious food.

* Those who want health care insurance but can’t afford health care insurance.

* Bootstrapping entrepreneurs.

* Young adults under 26 years old who can stay on their parent’s healthcare insurance.

* Those with pre-existing medical conditions will not be denied healthcare.

* Those with serious medical emergencies cannot be turned away.

* Democrats.

Losers

* Gym industry in the short run e.g. Bally’s Fitness.

* Health food restaurants e.g. Chucky Cheese’s just kidding.

* Nutrition stores e.g. GNC.

* Athletic apparel e.g. Lululemon.

* Small car makers e.g. Toyota, Honda, Tesla.

* Organic movement e.g. 9 Rabbits Granola bars, farmer’s markets, Wholefoods.

* Diet industry short term e.g. Weight Watchers.

* Yoga instructors, personal trainers, nutritionists, and workout fanatics.

* School administrators and parents who regulate what kids can and cannot eat.

* Small businesses that are barely hanging on and need to pay more taxes.

* Employees of small businesses that are barely hanging on who might be fired to cut costs.

* Republicans.

TO A BETTER TOMORROW 

People are very rational.  The reason why I don’t have a four pack anymore is because I’m too lazy to do sit-ups everyday and I looooove eating yummy food!  The joy of not exercising and eating anything I want “outweighs” the joy of having four-pack abs.  Now, if I was living in Hawaii and got to surf all day, I might recalibrate my attitude more towards having a tighter stomach.

We all know that being overweight puts a strain on our hearts and other organs, leading to other problems down the road.  But, we  still eat more than we should and exercise less than we should because we love food and exercising sucks!  Just look at the seven layer chocolate cake in the picture to the right.  There’s no way you can resist!

Because I love food, hate the gym, and believe every person in a country as rich as ours should have access to health care, I am 65% in favor of Obamacare. Disease does not discriminate between rich or poor.  Why should only those who can afford healthcare get to live? It just doesn’t seem right and we should pitch in to help those who are too poor to afford care.

Yes, payroll taxes on businesses will go up and income taxes will also be raised on evil rich people.  It also feels bad that the government is all up in our business. But, aren’t these small prices to pay for not having to hit the gym after an amazing seven layer chocolate fudge cake? I think so!

Recommendation:

I encourage everyone to shop around for health insurance, especially with the Affordable Care Act debacle that is not proving to be cheaper for many people. The internet has really helped lower the cost of insuring yourself and your family. eHealthInsurance has some of the lowest rates and best coverage due to its largest network online. They are based right here in the Bay Area, and I have met a number of their representatives.

Best,

Sam

 

Sam started Financial Samurai in 2009 during the depths of the financial crisis as a way to make sense of chaos. After 13 years working on Wall Street, Sam decided to retire in 2012 to utilize everything he learned in business school to focus on online entrepreneurship.

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Comments

  1. says

    I don’t see how the poor would be angry about this, there is no way they pay more tax. There is basically a vast expansion of medicaid to cover the poor and loads of tax credits etc to help people with lower incomes pay for coverage. There are also income limits on the “penalty” for all those people who are able to, but just plain choose not to get any form of health care.

    The rich may have a reason to be pissed, but heavy is the head that wears the crown. IMO sometimes you just have to do right by people less fortunate than yourself.

  2. says

    The whole thing makes me very nervous. Anything that takes 1000 pages to explain sounds like a perfect recipe for DISASTER. Individuals and businesses aren’t going have a clue what the terms and conditions really are and everyone is going to be totally confused. And of course taxes are going to be even more confusing, lovely, just what we need. Our healthcare system needs changes but I am not convinced the government has the ability to make this a success. I just hope I won’t have to give up my current insurance if the cost skyrockets. We’re in for one bumpy road.

  3. Jamie says

    My concern with the bill/ruling is that congress and the president has learned that it is constitutional to manipulate peoples behavior by fining them, as long as they call it a tax. They have always tried to do this (sin taxes, oil taxes, tax breaks), but now they can specifically write legislation to say “if you do/do not do what we tell you, you have to give us money. Some fun ideas I have for new “taxes” include
    A Fat Tax – Tax people over a certain BMI, which can be determined at the physicals they can now get.
    Sugary Soda Tax – If you buy 32oz or greater beverages containing sugar you have to pay a tax
    Brown energy tax – Tax people who are not taking advantage of green energy sources
    Combustion tax – Tax people even more who are using fuel inefficient cars

    and so many more. But don’t worry, none of these will be a tax increase as long as you comply with their “suggestions”.

    • says

      Such good points. So well said.

      The government is growing, and growing, and growing. Be rationally speaking, if we didn’t want big government, there would be no big government since we the people decide.

    • tom says

      Jamie,

      This is nothing new though. As you mentioned, we get taxed for doing/not doing things all the time.

      My problem is that this is a tax on living. Every tax, except this, you pay is contingent on something. You work, you pay income and payroll taxes. You drive, you pay oil taxes. You buy a house, you pay property taxes.

      With this bill, if you don’t do anything at all, I mean nothing, you live on the streets, no job, no nothing, you are still taxed. You are taxed for just simply LIVING.

  4. says

    I’m happy about this — I am employed in a small company that cannot afford to insure me. Moreover, I’m happy to see that the Supreme Court can decide things in a way that is rational rather than political. And I’m happy that Roberts, as young as he is, thinks for himself.

      • tom says

        Correction…

        They voted down ideological lines.

        Just because someone is ideologically conservative, does not politically make them a Republican.

        • Darwin's Money says

          Reality Check. 4 justices placed by Democratic president voted opposite 4 justices placed by Rep president.

          That is down political party lines.

        • tom says

          Except you forgot Roberts, nominated by Bush.

          You can’t claim a party line vote when 1 of 9 didn’t follow suit. That’s a pretty massive outlier to completely ignore.

        • Darwin's Money says

          Tom, statistically speaking, in order for it to be random chance that 8 of 9 would vote down party lines is virtually impossible. You speak of outliers as if it’s statistically sound.

          Nonsense. Almost all Supreme Court votes are down party lines like 5-4, 4-5 or even 5-3 when one abstains. Let’s face it, 8 of 8 voted their party and one didn’t. That is political.

  5. Darwin's Money says

    Funny take on it as usual Sam. What concerns me is that people are so naive to what this legislation does to our nation’s finances. It will destroy the country completely. We’re already $16 Trillion in debt and this will push the curve higher. In their infinite wisdom, the financial calculations for the plan “saving money” depends on US GDP growth at 3% or higher per year. What an f’in joke. We’re sub-2% during this “recovery” and plunging toward another recession. It’s just like the jokers assuming 8% returns for their pension plans so they don’t have to pony up more money to shore up shortfalls. If the numbers don’t add up, just change the assumptions to whatever you want so it fits!

    (remember when Obama said if you just give him the Trillion for stimulus, the unemployment rate would be sub-6% by now? (and NEVER exceed 8%))

  6. Investor Junkie says

    I didn’t like the law, not because it was less freedom but because it sucks eggs. Unlike the name it will not make health care more affordable, and will not improve the quality of healthcare. If anything it will make it more costly, and will not be deficit neutral. Hey at least we now call it what it is… a tax.

    Sam,
    I don’t understand your winners and losers. If the government needs to control expenses with this health care they certainly can adjust the winners and losers you list. Like NYC, larger than 16oz sodas – make it illegal, make incentives to join a gym, etc… etc… We become the preverbal lab rats since health care touches many aspects of our lives.

    On a positive note, If the law sucks we know exactly who’s at fault don’t we? They can’t spin it was the Repukes fault.

  7. says

    I am in favor of ObamaCare, but it did not go far enough. The only savings will be that the insured won’t have to pay for the uninsured. In theory, everyone will have insurance or pay a fine. I would like to see some cost containment features. Things like incentives to encourage good health. Early detection and monitoring of many illnesses reduces health costs.

    • David M says

      The problem is very few people are in favor of “rationing health care” and that is were the savings are.

      The amount money spent during the last few weeks of peoples lives is HUGE. However, no one would dare try to not spend that money. I would but as I have heard many times “I’m Un-American”.

  8. says

    This is definitely a highly charged topic. My curiosity is what is going to happen to the people in the states that won’t expand medicaid? Isn’t that one of the huge parts of the bill. Will these people be uninsured or just have to pay for their own now?

    • David m says

      I heard about this today – this fundede differently than regular Medicaid which is around a 50/50 split with the us govt. this will be close to 100% paid by the federal government and thus once the politics the expectation is that all or at least all but Avery few states will in the end sign the people up for – states even very red states are not going to turn down “free” Money!

  9. says

    I’m interested to see how this works out for Americans. I’m Canadian so I rely on these articles to figure out what your new policy is like. I hear that people with serious chronic medical conditions are not allowed to be turned down and the cost will decrease… No one mentioned this yet..

  10. says

    This is a subtle way our government has now found a way to control our lives. Period! I believe that, soon our government will tax you more for certain behavior mandates. Also, major corporations will start looking at their option to pay little over $1000 per employee in penalties to not provide health insurance. So, I don’t agree that those who have insurance won’t have any impact. I have some doctor friends who are telling me that they don’t like medicare and medicaid patients as their payments have been reduced by 25% already.

    Our government can’t run postal service or social security effectively. How can you expect them to run a major portion of our economy? It akin to allowing a kid to run a Mercedes when he can’t even run old Chevy well. Go figure!

    • says

      It’s not so subtle actually. I think it’s clear as day that the people have voted for big government to control more of our lives, and a HUGE portion of our lives at that.

      Again, if you are not paying extra taxes and receiving the benefit, then why not! If not, they this feels like an injustice.

  11. Mike says

    What happen to tort reform? You’ve gotta love that the lawyers get a pass on this. Leave it to the Democrats to completely ignore the effects of lawsuits in health costs.

  12. Darwin's Money says

    It’s great for people with no health care now, sucks for people who have/like their health care now. That simple. As usual with Obama’s policies, the people WITH will be paying for those Without. Again. Time and time again just like all the bailouts, tax policy, running up the debt others will have to pay, etc. Welcome to liberal america.

    • David m says

      I have not studied this so I ask a question that I do not know the answer to. How much is this really goiing to cost – wont this greatly decrease “free cost pools” and bad debts – which those with insurance are already paying for now with higher premiums? Also I’m hoping people will get help earlier now and that will decrease very expensive visits to emergency rooms.

    • says

      It’s not so bad though if you can benefit. Makes living life in a tough economic environment a little more bearable don’t you think?

      I don’t want to worry about going bankrupt just b/c I can’t afford health care!

      • David M says

        I agree that it is good – as far as it goes.

        I just wish we did more in America to keep the cost of health care down – so that there were more $ other things.

  13. says

    So what do you call the US healthcare system these days? It surely isn’t anything even mostly resembling a free-market. Why don’t you guys just admit you want to implement socialized medicine and at least do it right? ;)

      • David M says

        I’m in favor of socialized medicine!!!!!

        I just wish we did more on the COST side – like other countries do.

        I have health insurance and still paid about $10 for each Cipro pill here in the US. I went to India and purchased more pills – they were less than $1 each.

        I heard about the average reimburement rate for CT tests in the US and Japan – I thing the reimbursement rate in Japan is about 25% of that in the US. Why- well the Japanese government limits the number of machines (thus more usage per machine) and they limit the machine that can be purchased. They stated the machines used in Japan can do about 98% of what the US machines can but the cost per machine was MUCH less.

        We need to do something about the cost of healthcare before it bankrupts America!!!!

  14. says

    I’m all for health care for all, but not in this form. People should never be forced to pay something we don’t want. Just this year, I enrolled in a health savings account, enabling me to save pretax money for health care. I believe that I would be penalized under the new law.

    • David M says

      What makes you think you will be penalized – if you have insurance – what would make you think you could not keep it?

      I have a high deductable insurance plan with an HSA – and I love it. I put the money into the account and I get a deduction on my account and the earnings from the account – grown tax free. I have been in a High Deductable plan for a few years and have over $20,000 in my HSA.

  15. says

    At the end of the day there are many good features of the law. I was listening to the Speaker of the House on TV earlier and the whole Republican focus is to “… rip this out by its roots…” Wouldn’t the country be better served by having both sides work together to find a way to offer as many of the good features (children staying on their parent’s policies until age 26, more accessibility to be able to buy insurance and the like) vs. this continual partisan crap that is tearing this country apart? What happened to compromise instead of the its our way or the highway mentality that pervades both sides of the aisle. This is just another example of the need for statesmen, not the political hacks we now have in both parties.

    • David M says

      I also agree 100% Roger – thanks for posting!

      Compromise – should be a very postive word instead of the dirty word that it now is. We have lost the middle down in DC – the Democrats and Republicans are now out at the end of long dumbels with almost no one in the middle – thus compromise is unlikely – unfortunately!

  16. says

    I think the bill is ultimately a good thing and all this bickering over it being a tax or a fine is just a distraction from the real issue. I don’t understand why Republicans have not presented what they perceive to be a better way to make sure everyone in USA has access to health.

    Personally I think access to health for everyone ultimately saves money. It stimulates the economy because people don’t have to take any old job just so they can get insurance so you get more people chancing business. You have less seriously sick people to deal with because they were not worried about going to see a doc and various other things….

    I am happy to pay my fair share in “tax” to help make sure all my fellow humans are healthy and safe.

    Still, there is a long way to go in USA and part of that is seriously ramping up preventive care but as we know it’s nowhere near as profitable as providing ongoing care. It is going to be hard to make it the number 1 when health is still about profit.

  17. says

    I feel like none of the pundits that are for the bill talk about the costs. If an insurance company no longer has a lifetime cap do you think they are really going to just give up those profits? Equalizing prices between the sexes?! Why? Life insurance doesn’t do it – because men die earlier there and women cost more probably b/c of indoor plumbing in this case.

    The gov’t seems to try and make everything equal at the expense of the very smart actuaries that price out risk.

    Want to fix the problems? Go after cost and not the insurance.

    Sam,

    I’d love a post from you what your taxes are going to look like now – between Federal Income taxes going up without Bush cuts, then Cali, then the 3.8% you’ll likely be hit with on your non-earned income!

  18. says

    When the dust settles, the true winners are….insurance companies. The real losers are…liberals and progressives.

    That’s what amuses me the most from all this.

    If you support Obamacare, you are officially endorsing the health insurance scheme as the only way to cover all people. You are also stating that there is nothing in life that is more important than money, and that anything can and should be made into a market for the purposes of creating winners and losers.

    The insurance companies faced a true assault with the public option, which a large majority of Americans supported when the bill was being negotiated. With the public option gone, the only game in town are sleazy ba$tards and their lawyers who get between you and your doctor, and their only job is to drive up the cost of health care precisely so you need insurance. No different than “protection money.”

    The middlemen prevail again.

    • David M says

      Were do you stand on this John, I think your indifferent! :)

      The REAL solution is for Americans to get of their arses and exercise and stop eating sugar coated crap all day — likely to happen — NO! Obesity and diabeties are costing ALL of us – even as they keep driving up the cost of insurance.

      What am I doing about this – exercising, eating well, staying healthy and purchasing a High Deductable health plan. By using a high deductable health plan – I am subsidizing others much less than if I was with the less healthy in a standard type plan.

  19. says

    Interesting thoughts as always, Sam. I’ll admit to being biased, as one of those with ‘pre-existing conditions’ who can now be sure to get coverage, but I’m largely in favor of the bill. I’d even go a step further, and argue that most people’s position on this bill is determined, in large part, by whether the benefits for them personally outweigh anything they see wrong with it. (Of course, I’d make that same arguement about most legislation; being the ‘rational’ people we are, why wouldn’t we support things that help us and oppose those that don’t?) It has its rough spots (what bill passed by our legislators doesn’t?), but I don’t think it’s as bad as many people (largely Republicans) seem to think. I would definitely have preferred a different bill (one that, among other things, disconnected health insurance from employment more efficiently, so you weren’t desperately trying to get new coverage (and having to deal with those ‘pre-existing conditions’) at the same time you dealt with all the other issues of trying to find another job), but this represents a pretty good start.

    One thing I particularly like about this law is it helps hospitals to handle the added cost that laws like the Emergency Medical Treatment and Active Labor Act impose on them. When you have to treat everyone who needs your (emergency) service and worry about getting paid for said treatment later, it’s hard to see it as a bad thing to know that most of those you treat will have some sort of coverage to help pay for it. (If Obama and friends wanted even more good will for this provision, directing the money collected, whether you consider it a tax, a fee, or something else, and directing it toward hospitals, particularly in low income neighborhoods would be a swell method to get it. Of course, if the most dire predictions by some of the critics are even half true, the feds are going to need the money themselves before too long, but that’s another issue…)

    I do think you’re expecting people to pay a bit too much attention to their health insurance conditions before making snack choices, though. Even if people are completely rational, as you claim, there’s a lot of factors that go into making that choice to have a third donut, from how much you love donuts to how much your coworkers mock your love handles. I’ll keep an ear out for anyone saying, “Now that Obamacare has been found constitutional, why bother staying in shape?”, but I think it’s not going to have that big an effect. Now, if he goes for a donut tax, that’s a different story.

    Also, I’m holding off making any calls on whether the Republicans or Democrats won here until after the election (at least; give it a few years to get a full picture). If Obama gets the boot (or finds himself with a Republican Senate on top of the House), I’d say the Dems got a Pyrrhic victory, at best.

    • says

      I’m glad you will now be approved with your pre-existing condition Roger!

      At the end of the day, that’s what I want to hear. Everybody getting access to affordable health care, or at least disaster prevention care in our great nation. If I got to pay more, so be it.

      As for doing pushups and situps… I’m totally cutting down and hoping for a magic machine to keep me in shape thanks to the benevolence of the people!

  20. says

    I honestly don’t think I’m informed enough to have an opinion. I do know that I had an Economics professor in college that didn’t buy health insurance for his wife because she “never gets sick.” I’m sure he’s furious right now.

  21. says

    From Len Penzo:

    The US Constitution is no longer worth the paper it’s printed on.

    Civics lesson: The Constitution is a charter of enumerated powers — any powers not specifically authorized to the federal government within the Constitution are RESERVED FOR THE STATES!

    Those who want universal healthcare need to establish it at the STATE level — like Massachusetts did — not the federal level.

    The Supreme Court has been slowly undermining this document’s protections against the tyranny of a central government by twisting its words and finding meaning in the document that doesn’t exist since the turn of the 20th Century.

    We have become an entitlement-based society that looks to our government to be our nanny. Gimme gimme gimme.

    What happened to individualism and personal responsibility? How on earth did this nation ever survive before Social Security, Medicare, and now Obamacare?

    I fear for my kids’ future.

  22. elai says

    Countries with universal healthcare have lower obesity rates than countries without. With the government being the ultimate payer for healthcare, there is finally an incentive to increase the overall health of the nation. Expect to see fast food sin taxes, encouraging bicycle usage, maybe the end of corn subsidies, japan-style obesity taxes and so on. Also expect to eventually see a halving on spending on healthcare on a GDP per capita basis. Canada pays around ~$4k per person on health care, while the usa pays about ~$8k

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