The new health care law was passed in two pieces:
To read the Patient Protection and Affordable Care Act (PPACA), please click here. To read the Health Care and Education Reconciliation Act, please click here.Despite being marketed as a health care reform bill, the legislation that was signed into law expands the size and scope of the federal government, while failing to deliver on the promise to lower health care costs. Unfortunately, it will actually increase costs for many Americans, both in terms of higher insurance premiums and in higher taxes.
Specifically, analysis released by the Centers for Medicare and Medicaid Services (CMS) Office of the Actuary, the official government actuary for the Medicare program, confirms that the new health reform law fails to reduce health care costs. In fact, the Actuary's analysis finds that this new law will increase national health spending by $311 billion over the next decade. Equally concerning, the latest analysis warns that the Medicare cuts in the new law could jeopardize seniors' access to care.
Ultimately, hard-working Americans who are already struggling in this difficult economy are going to bear the brunt of new taxes, fees and penalties. With each day that goes by, it becomes clearer that we should repeal this bill and replace it with meaningful health reform that will actually reduce the cost of health care.
The President’s New Health Care Law
· Increases government spending by trillions. When fully implemented, this new law will increase federal government spending by $2.6 trillion, just over 10 years. To see a chart outlining federal spending as a result of this bill, click here.
· Increases the costs of health care. This law fails to deliver on the promise to lower health care costs. In fact, the Actuary of the Medicare program has stated in a letter that national health spending will increase by $311 billion over 10 years. For a person who buys a new insurance policy in the nongroup market, this means their average premium would be 10 to 13 percent higher in 2016 than if we had done nothing. This is an average premium increase of $2,100 for a family policy in the individual market. Americans did not want reform that makes their premiums even more expensive. To read a report issued by the Congressional Budget Office (CBO) on the increase in premiums, click here.
· Massive expansion of government health care. The new law includes a massive expansion in the government’s health care program for the low-income (Medicaid). Rather than making health insurance more affordable so that Americans could choose a policy that best meets their health care needs, 16 million more Americans will instead be forced into a government-run health care program in which 40 percent of physicians restrict access to patients. The Wall Street Journal ran an interesting story on this topic that you can read here.
· If you like what you have, you CAN’T keep it. About 14 million people will lose the health insurance they get through their job, resulting in more Americans enrolling into Medicaid. In addition, the new law will cut a total of nearly $145 billion from Medicare Advantage plans – popular insurance plans that deliver a range of health care options to millions of seniors. This law also places new restrictions on Health Savings Accounts (HSAs), Medical Savings Accounts, Flexible Spending Arrangements (FSAs), and Health Reimbursement Arrangements (HRAs). The law’s new restrictions and tax increases will dramatically change for the worse the coverage and benefits millions of Americans currently enjoy.
· New penalties and fees. This new law includes an unconstitutional mandate that requires most Americans to obtain health insurance or be charged a fine simply for not being insured. This fine could be the greater of $695 or 2.5% of your household income in the coming years.
· Taking money from Medicare and seniors’ health care to create new government programs. This law cuts more than half a trillion dollars from Medicare beneficiaries in order to pay for the creation of new government programs. This includes cuts to hospitals, Medicare Advantage, home health, nursing homes, and hospice care. According to the Medicare Actuary, about “15 percent of Part A providers would become unprofitable within the 10-year projection period” because of the health care law. The Actuary also found that the new law may result in doctors terminating their participation in Medicare entirely, “possibly jeopardizing access to care for Medicare beneficiaries.”
· New tax on retirees. On top of the Medicare cuts that retirees will face, this law actually increases taxes on employers who offer prescription drug coverage to their retired workers. This $4.5 billion tax increase will result in employers dropping their retiree health coverage, the exact opposite of what we should be doing. Click here to view a chart with information on these tax increases.
· New taxes on life-saving medical devices and drugs. These new taxes on life-saving medical devices and drugs make health care more expensive for patients and could stifle medical innovation. The Medicare Actuary found that this tax “would generally be passed through to health consumers in the form of higher drug and device prices and higher insurance premiums.”
· Job-killing tax. This health reform law imposes a new tax on jobs by forcing employers who do not provide “acceptable” coverage to pay a penalty tax of up to $2,000 per worker. The Congressional Budget Office confirmed that such taxes “could reduce the hiring of low-wage workers.”
According to the Medicare Actuary, businesses will pay $87 billion in new penalties between 2014 and 2019. These new penalties will fall on the backs of hard-working Americans who are already facing great financial challenges in a struggling economy. With unemployment at such high levels and with so few jobs available, the last thing our government should be doing is imposing new taxes that will actually kill jobs and make our “jobless recovery” even worse.
NEW SPENDING:
|
|
2010-2019 | 2014-2023 |
| Discretionary spending | $114 billion | $142 billion |
| Medicaid/CHIP Expansion | $434 billion | $913 billion |
| CLASS Act spending | $13 billion | $42 billion |
| Exchange subsidies | $358 billion | $780 billion |
| Risk adjustment payments | $106 billion | $207 billion |
| Other Medicare/Medicaid spending | $183 billion | $279 billion |
| Small employer tax credits | $40 billion | $42 billion |
| Exchange premium credits | $107 billion | $233 billion |
| TOTAL | $1.4 trillion | $2.6 trillion |
Senate Budget Committee Table
NEW TAXES:
|
|
2010-2019 |
| Excise tax on high-premium plans | $32 billion |
| Additional hospital insurance tax | $210 billion |
| Annual tax on insurance providers | $60 billion |
| Penalty payments by employers | $52 billion |
| Tax on pharmaceuticals | $27 billion |
| Tax on medical devices | $20 billion |
| Info reporting on payments to Coprs | $17 billion |
| Raise AGI floor medical deductions | $15 billion |
| Tax uninsured individuals | $17 billion |
| Reduce amount individual can save in Flexible Spending Account (FSAs) | $13 billion |
| Eliminate Part D expense deduction | $4 billion |
| New restrictions on HSAs, HRAs, FSAs | $5 billion |
| Tax on tanning salons | $3 billion |
| Impose fee on health plans | $3 billion |
| Increase HSA penalty | $1 billion |
| Exclusion of black liquor | $24 billion |
| Codify economic substance doctrine | $5 billion |
| Other taxes | $60 billion |
| TOTAL | $569 billion |
The $569 billion is a gross tax increase figure. CBO also counts a tax reduction against this amount, yielding a net tax increase of $525 billion for the combination of H.R. 3590 and H.R. 4872 – still the largest tax increase in history. The previous record was established by the Omnibus Budget Reconciliation Act of1993, which increased revenue by $241 billion over 10 years, according to CBO estimates (see Table 2-2 in CBO’s 1993 Update of the Budget and Economic Outlook).
Senator Burr's Prescription for Health Care Reform:
Instead of a government-run solution, Senator Burr believes in a different approach to health care reform. In order to give individuals and families choices in their health coverage and to avoid a one-size-fits-all program, we need to give people the means to purchase their own health insurance that fits their needs and the needs of their families.
To address the growing problem of employees having limited or no access to employer-provided coverage, Senator Burr believes we should foster a broad choice of health insurance plans that stay with you through job and life changes so that you can access care when you need it. Americans should control their own insurance and not fear losing it with job changes.
In May 2009, even before the Democrats unveiled their plans for health care reform, Senator Burr joined with Senator Tom Coburn and Representatives Paul Ryan and Devin Nunes to introduce the Patients' Choice Act, a bill that would have delivered on the shared principles of promoting access to quality, affordable health care, and would have done so without adding billions of dollars in new debt or taxes. The Patients' Choice Act would have made the following key reforms:
The United States currently spends twice as much on health care per person than other industrialized nations, yet we are not twice as healthy. The solution is not for the federal government to spend and tax Americans more, the answer is to get more value for our health care dollar through more choices. And this is exactly what the Patients' Choice Act would accomplish.
For additional information on The Patients' Choice Act, please visit: http://www.house.gov/ryan/PCA. "An Alternative to Obamacare" By Tom Coburn, Richard Burr, Paul Ryan and Devin Nunes
Real Clear Politics
May 20, 2009 "The GOP's Health-Care Alternative" By Grace-Marie Turner (Galen Institute) and Joseph R. Antos (AEI)
Wall Street Journal
May 20, 2009 "Patients' Choice Act is a serious proposal that merits serious consideration."
USA Today Editorial
May 29, 2009 Health Care Reform: A Debate Worth Having, By Paul Ryan and Devin Nunes
Washington Times
June 8, 2009