Why Obamacare Is Really Failing

As I’m sure you’ve all noticed by now, things aren’t going well for Obamacare. Reality has set in and his media buddies are turning against him. Now they’ve even had to admit that the numbers aren’t going to be good. Ha ha. But do you know what the real problem is? Read on...

Senior Obama advisor Dan Pfeiffer said on Sunday that the enrollment numbers for Obamacare “are not going to be what we want them to be.” This sounds a bit like Dr. Daystrom from the Star Trek episode “The Ultimate Computer” telling Kirk that the M1 through the M4 were “not entirely successful,” which was why he created the M5, which promptly went on a massive killing spree.

Anyway, WE knew the numbers were going to stink, it’s good that Team Obama finally realizes this. Interestingly though, Obama keeps trying to blame the website. In fact, Pfeiffer said that poor Obama is “frustrated” by the failure of healthcare.gov.incompetence and they swear they will get this sucker fixed by November so the public can revel in Obama’s glory. Ok, sure.

The thing is, I don’t think the website is the problem. Something is very wrong with Obamacare right now. If you look at the numbers, there should be 9 million uninsurables knocking on their e-door to sign up, but even their visitor numbers (and certainly the small numbers of people who tried to open accounts) suggest that didn’t happen. Why not?

Here’s what I’m thinking. The prices are simply too high. Thinking about the uninsurables, I see them in three groups. The first group are uninsurable because of some potential condition which doesn’t actually affect them yet. Those people have no reason to pay a ton to get insurance they won’t use... they can wait until they get sick. The second group have a condition that has bankrupted them. These people fall into one of two groups. The first group is probably already on Medicaid or disability and thus has no need for Obamacare. The second group is busy racking up the bills, but plans to file bankruptcy to get rid of them. They have no reason to sign up either because, to them, it’s just throwing good money after bad.

That leaves the third group: people who earn enough to cover their medical bills (and thus can’t file for bankruptcy or get Medicaid) but who can’t get insurance. This is the only group who would be interested in Obamacare and I frankly doubt there are many of them. Indeed, someone who is truly uninsurable is likely in the bankruptcy phase already. But let’s consider them for a moment.

In effect, the only uninsurables who will care about Obamacare are people whose bills are high each year, but manageable. Those people will look at Obamacare and ask the following question: will the premiums plus the full amount of the deductible be less than or greater than what I pay each year. As we’re seeing, premiums for families are around $1,200 a month and the deductible is $12,700. So unless their bills are greater than $27,100 a year, they have no reason to sign up either. And $27,100 covers a LOT of medicine, even for someone with an “uninsurable condition.”

What this means is that for even the vast majority of the uninsurables, Obamacare is a bad deal. And if it’s a bad deal for them, then it must be a horrible deal for insurables... especially the young, healthy “who needs insurance?” types.

In effect, Obamacare has priced itself out of the market.

An even worse sign for Obamacare is that Obamacare is suddenly becoming very “uncool.” It’s being mocked by comedians and average people. The actors who endorsed it have gone into hiding. The Democrats are screaming about problems. All that is bad. Indeed, when “the establishment” is mocking something, it becomes nearly impossible to get the sheep faction of the population to adopt it... it goes against the human herd instinct.

But even worse, the MSM is starting to rip it to shreds in a particularly nasty way. Specifically, they are finding the victims of Obamacare and highlighting their plights, typically with mentions that these people “supported Obama” and mentions that “Obama lied” about his promise that they could keep their insurance. Then they cite some massive premium number and tell a horror story about what the cancellation of the person's insurance has done to them. And each of these people is saying they would rather pay the fine. In effect, this is a very unfair story because it takes worst case anecdotal evidence and uses it to project a trend onto the public as a whole. That's logical BS, but since the MSM always does this to the Republicans, it's good to see them do it to their own side for once.

In any event, this adds a nasty touch to the PR which gives people the sense that Obamacare is something that hurts people and isn’t helping anyone (especially as they can’t even find people who are being helped). The message this sends is: avoid this menace, it will only cause you problems.

This is how products fail, when products get an “uncool” reputation as too expensive and “not something you want.” And fixing the website isn’t going to save it. Once the public adopts a particular mindset about something, it doesn’t change. And if the public sees Obamacare as something hurtful they should avoid, then forget this ponzi scheme ever getting off the ground.