OP-ED

No Free Lunch. No Free Contraception.

The otherworldy Obama Administration solution to the contraception firestorm might work politically but it makes no sense in the real world.

The President, hoping to quell a growing political firestorm, today announced a new policy that no longer requires religiously affiliated organizations to provide employees with contraception coverage in health-insurance plans.

Under the new policy, insurance companies will be required to offer free contraception for their employees and dependents. The administration’s idea is to shift the onus for the coverage from the employer to the insurer. Catholic leaders, and lots of other people, had objected to the requirement, which exempted churches but not hospitals, charities and universities with religious affiliations.

So, let’s just play a game here. The religious organization just pretends that it has nothing to do with it but the insurance company pays for it anyway. Hey, the insurance companies are rich.

Of course there is a cost. Today, contraception is almost universally covered in health insurance policies. The argument that forcing insurers to pay for it, without deductibles and copays, saves money because it avoids pregnancy costs is just plain silly.

If insurers saved money handing out contraception for free in the first place, they would have started to hand it out for free years ago. Add to that the insurance company must absorb a not insignificant administrative cost for adding a person-by-person “rider” for free contraception.

In addition, we have the unique situation where a business will be required to provide a product to a specific market (religious organizations not wanting to provide the coverage) but prohibited from charging for it–apparently because the government has done the cost calculation for them and in their sole discretion has decided they don’t have to.

The administration is arguing that offering contraception actually lowers costs and therefore forcing insurers to waive copays won’t mean higher costs. If this were 1970, when modern contraception was first offered, that might be true. But now plan sponsors are expected to waive copays and deductibles on something that is already virtually universally available.

This is simply an attempt by the administration to backpedal from a firestorm of controversy they should have never been in in the first place. They are caught between the left that is not about to back down over what they see as a critical women’s health issue and the right that is not about to countenance the government ever telling a church what to do.

But insurers will likely just shut up and go along with it. They have no intention of getting into the middle of this political mess—but they will quietly pass the costs along. In fact, for any large religious organization that is self-insured, they won’t have much choice but to pass the costs on to the employer. But that won’t be a problem so long as everyone just agrees to pretend.

This is a clumsy attempt on the part of the Obama Administration to be on both sides of a thorny issue.

The problem is that there is no free lunch and there is no free contraception.

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jbandaphotography.comDavidKemetraJulieJohn Ballard Recent comment authors
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jbandaphotography.com
Guest

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John Ballard
Guest

Once again the disinterested reader can see that beliefs trump facts.
Further arguments are wasted energy.

Kemetra
Guest
Kemetra

The Affordable Care Act reduces out-of-pocket expenses for women in the United States. This act covers birth control, well woman visits, mammograms, Plan B, sexually transmitted disease counseling, domestic violence counseling, and etc. All of these services will be provided without copay and deductibles. According to the new health plan young adults age 26 will get dropped from their parents insurance. Passing this act allows women to stay protected and continue preventative services. Birth control is not only used for contraceptive purposes; it is also used to decrease pain associated with menses, shrinking ovarian cysts, over active bleeding and other… Read more »

David
Guest
David

To Kemetra, The Catholic Church in many cases are the provider because in many case they are the insurer. In those case they would be part of the mandate. And I will repeat from a previous post. The U.S. Federal Government has no right to mandate any person, company or industry provide any product or service for free nor have they ever done so until now. The Federal Government can and does provide products or services for free through tax dollars which reimburses the provider. Never have they mandated any industry or company to provide actual services or products free… Read more »

Julie
Guest
Julie

Having insurance cover birth control fully, no co-pay seems up front like a good idea. However, who will be paying for the co-pay that once did exist? Will premiums increase? More than likely, yes, where else will insurance companies obtain the funds? I completely understand where the Catholic community is coming from, it’s their belief, and while not my belief, I have respect for theirs. Then Obama came about and made a change stating that insurance companies will provide free birth control, not the religious organization. In other words, religious organizations are not required to offer free birth control, only… Read more »

John Ballard
Guest

Lighten up, folks. All this indignant talk about expenses and government mandates is a smoke screen. Anyone who has ever built a house knows that building codes change between the time the plans are approved and the house is under construction, and the changes invariably ratchet the costs up. Same goes for safety regulations from children’s toys to medical devices. Should I go on? For insurance companies it’s an accounting modification and nothing more. Costs for contraceptives now get a journal entry under “expenses” along with electricity, advertising, complementary catered lunches to doctors’ staffs, junk mail printing and postage and… Read more »

David
Guest
David

In the unlikely event some regulation is added that makes a home currently under construction more expensive to build that cost is passed on to the buyer even if they have already agreed on a price. Regardless of perceived cost savings the Federal Government has never mandated any industry or company provide any product or service at their own expense, period. It is a dangerous precedent! If allowed to stand were does it stop? It will happen again and again to continually bribe constituents for votes. Once government perceives to have that right they will exploit it at every opportunity… Read more »

John Ballard
Guest

…the Federal Government has never mandated any industry or company provide any product or service at their own expense, period. Safety equipment doesn’t count? Seatbelts? Fire extinguishers? Backup warning sounds? What about food inspectors? I once toured a poultry processing plant and one individual on the production line was identified as the federal inspector. She was snipping off bruised spots, broken wings and legs and tossing them aside. When I said something about tax dollars at work I was corrected and informed she was on the company payroll. I recall vividly since it struck me as a conflict of interest.… Read more »

David
Guest
David

If you are mandated to have a fire extinguisher you still had to pay someone that makes them.. The maker of the extinguisher was not mandated to provide it for free. When cars had to have seat belts their cost was passed on the the consumer. Just like when airbags were mandated the supplier did not provide them to the car companies for free and the car companies past that cost to the consumer. Yes Government mandate happen all the time but they do not mandate who pays. Mal-Mart and Target are not mandated to provide car seats to consumers… Read more »

Luke S.
Guest
Luke S.

You have got to love the government. As soon as they see an opening they are going to try to impose what they think is right on everyone. When will they realize that one size does not fit all and they can not just walk in and dictate their agenda to us. Birth control cost and somebody will pay in the end. Socialism at its best.

louisdou
Guest
louisdou

Oppps, rational people finnaly arrive at the conclusion that the adminstration has no authority to tell private citizens and entities what to buy or giva away “free”.. Quick, we must distract with data (not information) and call them names. I’ve got it, they are just a bunch of name callers.

Jonathan H
Guest
Jonathan H

Has anyone estimated what the net effect on premium this policy is expected to have, after reduction in abortions and births are accounted for? $1 per month per policy? Less? More? I’m looking for data, not intuitions. I saw a recent poll that reported the highest approval of Obama’s policy to be among Catholics (vs mainline Protestant and evangelicals), something like 70%. Still, this seems like a bad battle to pick for Obama. The religious freedom argument cannot be easily dismissed (though many of these institutions, especially the hospitals, have little in the way of religious identity left). And as… Read more »

BobbyG
Guest

Nobody cares about “data” when it comes to stuff like this (except to the extent that they can selectively cite them in the service of their foregone conclusions). The more you counter them with empirical evidence, the more they will just call you names.

And, Jonathan, you are right. It indeed does not compute. But, it’s just part of the overall ongoing Whack-a-Mole cost shifting that characterizes our reimbursement “system.”

tcoyote
Guest
tcoyote

THey actually didn’t get out of the problem because the Bishops didn’t buy it. And the point about being self-insured is exactly right. If all the insurer does is provide administrative services only, the “free” contraception is paid for by the self-funded employer. But the larger issue that Robert addresses is really troubling: what makes the administration think that it can just declare benefits to be “on the house” as fits their political situation. It’s completely arbitrary. THey really think they own the health insurance system, and Secretary Sebelius is now “The Nation’s Health Insurance Commissioner”. It’s a little like… Read more »

David
Guest
David

I agree that you and this article has touched on the major point on this issue and I would like to expand on this. Regardless of the 1st amendment issue which I agree the administration’s attempted compromise did not solve. When has the federal government ever mandated any person, company or industry provide any product or service for free? And if it is allowed to stand where does it stop! It’s not like government has ever showed any kind of restraint on a right it perceives to have. This sets a dangerous precedent! I know the federal government has and… Read more »

Katie M
Guest

This was a very insightful post that allowed me to view the issue at a different angle. I had completely forgotten about TNSTAAFL as I was watching this play out on the news. I’m not sure yet where I stand on the issue itself, but I can now see how the administration didn’t do much to actually remedy the situation.

Katie M
Guest

This was a very insightful post that allowed me to view the issue at a different angle. I had completely forgotten about TNSTAAFL as I was watching this play out on the news. I’m not sure yet where I stand on the issue itself, but I can now see how the administration didn’t do much to actually remedy the situation.

Joe Priest
Guest
Joe Priest

The contraception matter is immaterial and distractionary at best, considering the platform in general. Broaden your vision, friends. http://zoev9.wordpress.com/2012/02/04/a-week-passed-a-year-passed-a-nation-unhealthy-but-treatable/

BobbyG
Guest

Wow, Joe. Nice stuff, nicely documented. 5.USC.8103 Verbatim: “(a) The United States shall furnish to an employee who is injured while in the performance of duty, the services, appliances, and supplies prescribed or recommended by a qualified physician, which the Secretary of Labor considers likely to cure, give relief, reduce the degree or the period of disability, or aid in lessening the amount of the monthly compensation. These services, appliances, and supplies shall be furnished – (1) whether or not disability has arisen; (2) notwithstanding that the employee has accepted or is entitled to receive benefits under subchapter III of… Read more »

kim
Guest
kim

I am astonished — no, I can no longer be astonished at the Administration’s policy decisions — by the failure to recognize that many of the impacted religious organizations are likely to be self-insured…so who is the insurer who will offer the “free” coverage, and who will pay for that (e.g., the self-funded plan will get any savings via reduced maternity, not the insurer)? The administration looked a the Hawaii model to craft this so-called compromise…if memory serves, Hawaii has the only ERISA exemption, so in effect there are no self-funded plans there. Is it possible that no one in… Read more »

MD as HELL
Guest
MD as HELL

all

MD as HELL
Guest
MD as HELL

If the Left is of the mind that free birth control pills are on par with eliminating religious freedom, then they do not deserve to be in the discussion at akk. But I just do not believe the Left really thinks that at all. They are free to be the Left and I free to be the Right due to the shackles on government power established by the Constitution.

Loosen the shackles and we have to fight the King all over again.