The Independent Investor: Week One of Obamacare

In the face of a government shutdown, computer glitches and a mountain of confusion, Obamacare made its inaugural debut this week, so far, so good.

The federal government's new health insurance website went live on Tuesday and promptly crashed as did the state of Maryland's site for enrolling Americans under the Affordable Care Act. The glitches also included a computer jam on the District of Columbia's site as well as a delay in the plan for small-business owner's enrollment. Experts say to expect even more foul ups.

So why do I say this is all good? The reason the Federal site crashed was because of the overwhelming interest in the exchanges. Within three hours of its opening, the national healthcare.gov site had one million visitors. Overall, 4.7 million visitors accessed the site on the first day. That is five times the number of users that have ever visited Medicare.gov. On that first day over 190,000 people called the federal hotline on information about Obamacare. In California, Colorado, Connecticut, D.C., Florida, New York and several other states the response has been gratifying and completely unexpected as well.

For all its complexity, with most of its details still misunderstood by the majority of Americans, and the active resistance by some states and political parties, the demand to enroll has been overwhelming.

It is too early to predict whether Obamacare will really succeed, but it seems to me that the idea of electronic insurance exchanges is an idea whose time has come.

In today's world, the internet is used as much for comparison shopping as it is for other kinds of information. Whether you are looking for an airline flight, hotel room or the best price on a television, you turn to the internet for help. For the first time in our history, we can now comparisons shop for health care.

Let's face it, applying and purchasing individual health care is a complex, confusing business, whether in the private sector or through this new government program. Health-care providers, in order to capture your business on these new exchanges, are going to be forced to be specific about what they offer and why it is better than the next guy's plan and do so in language we can understand. That to me could be the real key to the success of this endeavor.

Evidently, investors and health-care providers think so as well. Health-care stock prices are up and I have detected a subtle shift toward accepting Obamacare in the financial world over the last several months. That leaves only the Republican Party left to dissent. The tea party and its multibillion dollar backers have conducted a campaign of misinformation and deceit about the plan since its inception. They have been so adamantly opposed to Obamacare that they have been willing to shut down the Federal government in protest. That will prove to be a mistake, in my opinion.

Historically, Americans have resisted attempts by government to effect social change whether we are talking about Social Security, welfare, food stamps, Medicaid or Medicare. As late as 2006, for example, the introduction of Medicare Part D, the drug prescription benefit, was highly unpopular. However, with the passage of time people not only accept the change but come to approve it and even depend on it.

 Although the Affordable Care Act is far from perfect and in need of many revisions, it is a start in a process that I believe one day all Americans, including most Republicans, will come to accept. The trick is to stick with the idea and improve it. So far, so good.

Bill Schmick is registered as an investment adviser representative with Berkshire Money Management. Bill’s forecasts and opinions are purely his own. None of the information presented here should be construed as an endorsement of BMM or a solicitation to become a client of BMM. Direct inquires to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com.