RUSH: Another delay on Obamacare, ladies and gentlemen. The regime "has delayed a step crucial to the launch of the new healthcare law, the signing of final agreements with insurance plans to be sold on federal health insurance exchanges starting October 1. The US Department of Health and Human Services (HHS) notified insurance companies [yesterday] that it would not sign final agreements with the plans between September 5 and 9, as originally anticipated, but would wait until mid-September instead...
"The reason for the hold-up was unclear. Sources attributed it to technology problems involving the display of insurance products within the federal information technology system." That means they don't know what they're doing in getting the various options that consumers will have online. So Health and Human Services just told the insurance companies -- the evil, rotten insurance companies -- that they won't be able to sign their final agreements, as originally planned.
That may delay the start of the exchanges, which were supposed to launch on October 1st. That's gonna put off the open enrollment period, never mind that the same federal government is spending hundreds of millions of dollars to try to get people to sign up as quickly as possible to what? They're trying to get millions of people to sign up -- and again, just to repeat why they want that done. That's why Obama's out speaking. That's why he's out conducting sales pitches.
They want as many people as possible to sign up at these exchanges because that will cement the entitlement aspect of this. As many people as they can get signing up at the exchanges is like thousands of people signing up for Social Security, or signing up for Medicare. Once they get those people signed in, locked in, that theoretically locks in the entitlement and makes it impossible to take it away from people.
So while they're out hustling and trying to get as many millions of people to sign up at the exchanges as they can, they have now said there's not gonna be anything to sign up to, because they've had to delay it. The one thing that has not delayed is the individual mandate. You still have to have the individual mandate. You still have to have insurance, or pay the fine. That isn't gonna change. That's not gonna be delayed in any way, shape, manner, or form.
Here's the way the formula on that works. It's another earth-shattering story. The IRS yesterday finally issued their rules on this, and I left it far down in the Stack. Here we go. If an individual chooses not to buy insurance, that individual (i.e., you) is subject to a penalty. The IRS made it official yesterday. They issued their final rules on the individual mandate. Here's how it works: The fines start at $95 per person per year or 1% of your income in 2014, whichever is the greater.
It eventually reaches $695 per person, or 2.5% of income by 2016. I just mention this because I want to use this information to cement what has been the case all along and what I have been saying for a couple years now. The penalties, the fines are incredibly low, and the purpose is to suck in the poor and particularly the young. They don't care in the first two years whether you buy insurance, because they're making the fine so inexpensive -- $95 a year versus an insurance policy?
What are you gonna do? If you're 25, 30 years old and you don't have much of a job, much of an income and yet the law says you have to have insurance or pay a fine -- and your insurance costs (pick a number) $5,000 a year, or the fine is $95, what are you gonna do? Well, here's the option: You're gonna choose the $95 every day of the week. Now, it may not be $95. It's that or 1% of your income, whichever is the greater.
But it's still dirt cheap compared to having insurance. However, what happens between now and 2016 when the fine goes from $95 to $695, and in the next year after that? It doesn't take long for the fines to approach four figures. So what do you do? You opt in by paying the fine. Let's choose a rounded-off number. You're a young person or somebody with not a lot of income, so your option is a $5,000 insurance policy or paying a $100 fine.
You pay the fine, and you're safe. You're legal. Next year, the fine's 150 bucks, and the insurance is $6,000. What do you do? You pay the fine, 150 bucks, and you're legal. What are you not doing? You're not buying insurance. What happens to people who sell insurance when nobody's buying it from them? They go out of business. The purpose of Obamacare, one of the many, is to make the fines so cheap that everybody will choose the fine rather than the policy.
The more people paying the fine, the more people not buying insurance. Now, right now the only place to buy insurance is from a private sector insurance company or plan. But if we go for two years with the vast majority of people not buying insurance, what happens to the company selling it? They find it harder and harder and harder to stay in business. There is no way that you're gonna be able to get an insurance policy at a hundred bucks a year, anywhere close to it.
But! But, folks, here's the thing. In 2016, the fine becomes $700 or more. By 2016, there are going to be fewer insurance companies left selling insurance -- and the fewer companies, the less competition; the more expensive it's gonna be. It's gonna get to the point where the fines are all of a sudden gonna be really sizeable, and it isn't gonna make any difference whether you pay the fine or buy a policy.
The difference is going to be that by the time the fines approach the same cost as the policy, you're only gonna have one place to go to get the policy -- and that's the government, the exchanges -- because private sector insurance will have been destroyed. What percentage of the American youths and poor do you think will not do the fine? I mean, this is for people who do not have insurance at their work.
And there are gonna be more and more people who do not because companies are converting people from full to part time. The whole point of Obamacare is right here: Government-run, single payer. That's what's out on the horizon, and the way we get there is to slowly dissolve private sector insurance as an industry. Just get rid of it. When it's not there there, and the law says you have to have health insurance, pretty soon the only place to get it is going to be at the government.
RUSH: I'll tell you, there's another thing about these fines not really becoming costly until after 2016. You notice in 2014, the fine is $95, versus the policy $5,000. So who's gonna buy the policy? The next year it's 150 bucks -- Big whoop! -- versus $5,000 for a policy. In 2016, the fines start getting big: $695, 700, 800 bucks. That's after the elections. It's another reason why the fines are cheap: Drive private insurance out of business, and also to limit the damage to Democrats (who own this bill) both in 2014 and 2016. The big fines, the real big costs are not gonna hit everybody until after the 2014 and 2016 elections.
RUSH: Okay, Cindy in Louisville, it's great to have you on the EIB Network. Hello.
CALLER: Hello. It's an honor to speak with you. Long-time listener.
RUSH: Thank you very much.
CALLER: And this is kind of ironic or actually perfect timing with Senator Cruz being on just a few minutes ago. I just had a talk with my health care provider, which is Humana One here in Kentucky, and I have a monthly premium now at $174.74 a month. Three months ago it went up like $70, and I don't have any claims. I'm relatively healthy. I just go to my yearly checkup like colonoscopy, that kind of thing.
It's a very major medical policy with a $7500 deductible, that kind of thing. Anyway I just got off the phone with them about three or four hours ago this morning, and now it's $468.08 a month, and that will start in December of '14. Actually, I guess, it would be January 2015, but the actual rate will go up to that point and it will be under a ACA compliant policy, I will no longer be able to have the plan I have now.
RUSH: No, no, because President Obama said, under the Affordable Care Act you get to keep your plan if you like it. No, you're wrong about that. You get to keep your plan, you get to keep your doctor, and your wrong about your premiums tripling. You're premiums are gonna go down by $2500. The president said that, Cindy!
CALLER: I know it, and that's what happened. I was really upset. I told him. I said, "Can I speak to someone else? Can I get another policy a lot cheaper and maybe even a higher deductible?" He said they will not do it. He said Humana One, as well as all the other insurance companies, will not be able to provide you options. It's just whatever the 2014 ACA compliant policy says. You know, I was really upset! I called McConnell's office and of course I can never get through to his office. So I called an aide, 'cause I work at a nonprofit organization here in Kentucky that does what you do on a lot smaller scale, trying to get the word out about our kind of conservative ideals.
RUSH: I think they know. I think people are encountering this every day. The president was wrong when he said that you get to keep your policy and your doctor and that your premium was gonna go down $2500. You're one of millions finding this out, and others have no clue yet, but they are going to encounter this at some point -- and then they're gonna get sugar. They're gonna get subsidized. You aren't gonna get subsidized, but a lot of people are.
They're gonna have that paid for or part of it paid for. They're gonna love it. It's Santa Claus passing out health care. So you just heard it. Her premium's 174 bucks and it's going to $468. Welcome to Obamacare mandates! But, Cindy, look at the bright side. You're now gonna be able to get coverage for your sex-change operation. (interruption) Well, no, she didn't say she wanted that, but, I mean, it's one of the benefits. If she wants to do it, it's covered. So that tripling of her premium, there is value there.
If she wants to have a sex change, like an addadictomy would be what that is called, she's got it. Cindy in Louisville, thank you for the call.