Monday, November 16, 2009

No Free Lunch: The True Cost of ObamaCare

No Free Lunch: The True Cost of ObamaCare
Matt Patterson
Friday, November 13, 2009

Far from providing "affordable" care for everyone, ObamaCare would come at a painful price - higher insurance premiums, more and higher taxes, fewer jobs, lower wages, a reduced standard of living and an erosion of privacy and individual liberty.

Here's the real cost of ObamaCare.

Higher Premiums - Billions in new taxes and fees would be imposed on health insurers and companies to pay for ObamaCare - costs which would be passed on to the consumer as higher premiums.

Higher Taxes - Government cannot provide free or subsidized care for someone without taking money from someone else - and that someone else may be you. The Wall Street Journal puts it bluntly: ObamaCare will be paid for with "huge tax increases." How huge? According to Jeffrey H. Anderson, Ph.D, Senior Fellow of Health Care Studies at the Pacific Research Institute, one ObamaCare proposal would "raise taxes by $2.3 trillion" over the next two decades. Yes, trillion.

Lower Wages/Fewer Jobs - New taxes and fees imposed on businesses by ObamaCare would "discourage companies from hiring or continuing to employ low-income and moderate-income workers," according to the Heritage Foundation. And it won't just be low-income workers who see a smaller paycheck - according to FORTUNE magazine's Shawn Tully, ObamaCare would lead to "a steep, shocking decrease" in the incomes of middle-class workers.

Standard of Living - The massive government spending required to finance national health care would explode the federal deficit with ruinous consequences for every American's standard of living. According to the Congressional Budget Office, "Large budget deficits would reduce national saving, leading to more borrowing from abroad and less domestic investment, which in turn would depress income growth in the United States. Over time, the accumulation of debt would seriously harm the economy."

Medicare Benefits - ObamaCare would pay for itself, in part, with hundreds of billions of dollars in cuts to Medicare and Medicare Advantage. But the Congressional Budget Office warns that cuts to Medicare Advantage "could lead many plans to limit the benefits they offer, raise their premiums, or withdraw from the program," devastating seniors' health-care options. The Wall Street Journal confirms, "cuts in Medicare's price controls will cause many doctors to quit the program."

Privacy - ObamaCare regulations would result in a larger, more powerful IRS, and ensure that more of your personal information is shared with more people.
According to the Washington Examiner's Byron York, ObamaCare would mean "an expanded and more intrusive IRS," which would be empowered to target and punish violators of the new law. Additionally, an ObamaCare tax on employers would necessitate your boss knowing your family's entire income from all sources, information which would then be shared with the insurance company.

Your Freedom - Think you have the right to decide whether you even want insurance? Guess again. ObamaCare would require, under threat of penalty, every American to have insurance, fundamentally altering the relationship between citizen and state. As the CBO puts it, ObamaCare "would establish a requirement for [legal U.S. residents] to obtain insurance and would in many cases impose a financial penalty on people who did not do so." So much for 'land of the free.'

ObamaCare won't save us money, nationally or individually. Instead, it will increase insurance premiums, raise taxes, depress wages, siphon jobs, explode the deficit, reduce our living standard, rob us of privacy and erode our personal liberty.
That's the kind of "free" care we just can't afford.

Congress' Shoe Problem
David Gratzer
Friday, November 13, 2009

Congress has a shoe fetish.

The basic problem with ObamaCare – the core problem – is buried deep in the 1,994 page bill passed by the House of Representatives. More unsettling than the full price tag – $3 trillion over ten years, when fully implemented, according to the CBO – and more ridiculous than the many bureaucracies it establishes – including, no kidding, an Office of Administrative Simplification – is the commitment of Congress to better your feet.

The House would require that all health insurance cover orthotics. It’s a small idea, one easily overlooked, but it would put America’s foot – metaphorically speaking – in it.

For people with arthritics and diabetes, orthotics can be important. For others, they can bring comfort. But that single requirement suggests that ObamaCare – if finally passed by the Senate and signed into law – will raise the cost of health insurance.

And it’s just the beginning. The ObamaCare bill sets the stage for many more requirements and rules.

New Yorkers, of course, already know the problem of legislators who focus on, well, the feet first. New York State has one of the most dysfunctional health-insurance markets in the country. In 2005, a leading online insurance brokerage, eHealthInsurance, calculated the cost of a standard individual insurance policy across the nation’s 50 largest cities, comparing some 4,000 insurance plans offered by 140 companies. New York ranked as the most expensive city, its lowest premiums more than five times pricier than those of cities like Columbus and San Francisco.

Why the price tag? For years, Albany has regulated first, and asked questions later.

State lawmakers have mandated that all health plans cover a host of procedures and services. Even the most stripped-down plan must include coverage of off-label drugs, surgical second opinions, midwife services and, yes, orthotics. Each mandated benefit, of course, makes the policy more expensive. New York also demands that people pay roughly the same premium regardless of age or health status – a move that discourages younger, healthier people from buying insurance, and thus driving up premiums for those left willing to buy. Finally, the state has added billions of dollars in fees and other taxes to private insurance policies, making them even pricier still.

Since the state began aggressively regulating insurance in 1993, the number of individual-insurance policyholders has dropped by roughly 96%.

It’s not simply the cost, of course, that is so problematic with the New York approach to health reform. It’s the end result: many opt not to buy insurance in the first place. These regulations and taxes, aimed at making health insurance fair, end up making it unaffordable.

In a recent analysis, researchers Steve Parente and Tarren Bragdon look at New York State. They find that repealing regulations would lower premiums and help as many as 37% of the uninsured there to buy private, unsubsidized coverage. It would also help reserve scarce tax dollars for the poorest and sickest New Yorkers. Call it the 1992 reform: turning the clock back on more than a decade and a half of failed experimentation.

With Albany messing up health insurance, it’s no surprise that the most innovative reform has come from the Freelancers Union, which allows its tens of thousands of New York members to group together and opt out of the individual insurance market – and thus the regulation insanity.

But Congress isn’t asking why the Freelancers Union wants to walk away from the regulatory debacle. Congressmen just voted for a bill that contains all three bad New York ideas: a mechanism to regulate every health-insurance policy, a flat premium for all Americans, and a raft of new taxes.

Soon, if ObamaCare is implemented, the future of American health care will be New York. Unless, of course, the Senate sets aside these provisions in the bill passed by the House.

But the Senate leadership is on record supporting legislation that would create a committee charged with deciding what would be a “basic” health insurance policy, with unelected Washington bureaucrats having the power to add regulations – like orthotics – as they see fit without any Congressional approval. While the final Senate draft legislation will not be available for days, this much is already clear: Democrats in both the House and the Senate think health reform should include everything from the feet on up.

Americans should remember that there is no such thing as a free lunch. Or free orthotics.

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