Research Briefing

Truth About The Harmful Effects Of ObamaCare Continues To Drip

OBAMACARE CONTINUES TO HURT JOB CREATORS …

Alcon, Inc.: “U.S. Health Care Reform Reduced Sales By $5 Million In The Quarter.” “Alcon, Inc. reported that global sales rose 15.3 percent to $1.72 billion for the first quarter of 2010, or 9.6 percent excluding the impact of foreign exchange fluctuations and acquisitions. Revenue from acquisitions added 20 basis points to sales growth in the quarter. U.S. health care reform reduced sales by $5 million in the quarter.” (Alcon, Inc., “Alcon's First Quarter Net Earnings Climb 26.8 Percent On 15.3 Percent Sales Increase,” Press Release, 4/26/10)

• “Adjusted Net Earnings In The First Quarter Of 2010 Exclude… A $25 Million Period Tax Charge Related To A Change In The Tax Treatment Of Retiree Medical Benefits In The United States Included In The Health Care Reform Bill.” (Alcon, Inc., “Alcon's First Quarter Net Earnings Climb 26.8 Percent On 15.3 Percent Sales Increase,” Press Release, 4/26/10)

President Of Grand Haven, MI-Based Midnite Sun & Cruise Says ObamaCare’s Tanning Tax Breaks Obama’s Campaign Promise Not To Increase Taxes On Middle-Class Americans. “But some regular customers at Midnite Sun & Cruise spend up to $80 per month on tanning packages, said Dan Van Dine, president of the Grand Haven-based chain with 15 stores in Grand Rapids and along the lakeshore. ‘In some people's cases, you're looking at $8 a month in tax,’ he said. ‘The promises during the election were no taxes to the average American, and our customer, for the most part, is the middle class.’” (Matt Vande Bunte, “New Tanning Tax Coming In July Could Doom Business, West Michigan Salon Owners Warn,” The Grand Rapids Press, 4/27/10)

• Van Dine: “In This Economy, It Surely Doesn't Help Things. I Don't Think Taxing Anybody Right Now Is Good Business.” (Matt Vande Bunte, “New Tanning Tax Coming In July Could Doom Business, West Michigan Salon Owners Warn,” The Grand Rapids Press, 4/27/10)

Manager Of Grandville, MI Tanning Salon Says Tax Makes It Harder To Be A Small Business. “Electric Beach may offer an extra session in its tanning packages to offset the tax or look to sell longer-term packages before July, said Robin Elkins, manager of the Grandville store at 4763 Wilson Ave. SW. ‘I don't think people realize that with the health-care plan there was going to be a service fee with tanning,’ she said. ‘Being a small business, it's hard as it is, let alone having a 10-percent tax on top of everything.’” (Matt Vande Bunte, “New Tanning Tax Coming In July Could Doom Business, West Michigan Salon Owners Warn,” The Grand Rapids Press, 4/27/10)

•  Elkins: “We're In Michigan. Can People Really Afford To Pay More? It's Going To Hurt Our Business.” (Matt Vande Bunte, “New Tanning Tax Coming In July Could Doom Business, West Michigan Salon Owners Warn,” The Grand Rapids Press, 4/27/10)

Owner Of Thomaston, CT Tanning Salon Says Tax “Could Kill Us.” “‘I just feel like they're picking on us,’ said Kim Girard, who owns Sunsational Dreams in Thomaston. Girard's business is down overall from last year, but is picking up as area students dive under the lamps in search of a summer glow for proms, graduations and swimwear. ‘This is busy season -- February through June. Business really drops off over the summer, when people go tan at the beach,’ she said. ‘This tax hits in July, and that could kill us.’” (Alison Shea, “Tanning Salon Owners Scorched By Tax New Federal Health Plan Taxes Bed Use,” Waterbury Republican-American, 4/27/10)

WON’T PROTECT THE UNBORN …

Planned Parenthood In Michigan Shows “An Early Sign Of Health Care Reform’s Impact” By Planning To Open A New Clinic “Likely To Include Abortion Services.” “An early sign of health care reform's impact is Planned Parenthood's decision to open a new Oakland County clinic within the next 18 months, adding to 15 locations, including Detroit, Warren and Livonia. Unlike other Detroit area centers, the new location is likely to include abortion services. Richards and Lori Lamerand, executive director of Planned Parenthood of Mid and South Michigan, are ramping up for a boom in birth control and other reproductive services -- what Lamerand calls ‘an onslaught’ of women poised to gain new access to reproductive health care.” (Laura Berman, “Health Law, Economy Shape Family Planning,” The Detroit News, 4/27/10)

WILL LEAD TO HIGHER HEALTH CARE COSTS …

The Buffalo News’ Editorial Board Says CMS Report On ObamaCare Has A “Sobering Conclusion … Because It’s A Best-Case Scenario” That’ll “Be A Real Blow To The Elderly.” “In the first report since the bill was passed, economic experts at the Department of Health and Human Services say the bill, passed only last month, will increase the costs of health care… [W]hile it represents only a 1 percent increase it's still a sobering conclusion … because it's a best-case scenario, and it's dependent on a half-trillion dollars in cuts to the Medicare program, largely through Medicare Advantage. These cuts, projected to save $520 billion over time, would be a real blow to the elderly.” (Editorial, “Health Costs To Rise,” The Buffalo News, 4/27/10)

The Buffalo News Editorial Boards Slams ObamaCare For Being “Misnamed The Affordable Health Care Act.” “Without cost controls, reform can't achieve the necessary and crucial long-term goals of providing affordable, high-quality health care to all Americans. Congress and the administration need to monitor the implementation of this law, misnamed the Affordable Health Care Act, and make changes as they are called for.” (Editorial, “Health Costs To Rise,” The Buffalo News, 4/27/10)

The Buffalo News Editorial Board: “[F]ailure To Curb Those Costs And Pay For The Expansion Of Care Makes It Even More Likely That This Year's Legislation Will Lead To Very Serious Consequences For Everyone.” (Editorial, “Health Costs To Rise,” The Buffalo News, 4/27/10)

WON’T IMMEDIATELY COVER YOUNG ADULTS …

Young Adults May Not Be Able To Get Their Parents’ Health Insurance Coverage Right Away, And Some “Could Experience A Break In Coverage,” Because The Companies Their Parents Work For May Not Offer The Benefit Until 2011. “President Barack Obama's health care overhaul was supposed to take care of a major worry for parents of 20-year-olds making the transition to work: keeping the kids insured. But what sounds like a simple solution — starting this year, letting young adults stay on their parents' health plan until they turn 26 — involves a surprising amount of fine print. … Under the health care overhaul law, there may be a lag in when they offer the new benefit. That's because the law says the coverage extension is effective for the first plan year on or after Sept. 23. For most big company plans, the new plan year doesn't start until Jan. 1, 2011. Some young adults currently insured could experience a break in coverage.” (Ricardo Alonso-Zaldivar, “Some Families Will Face Wait To Cover Young Adults,” The Associated Press, 4/27/10)

TowersWatson’s Ron Fontanetta Says “There Is No Free Lunch,” Predicts Employers Will Raise Premiums To Cover Cost Of New Benefit. “It's also unclear how employers will charge for the new coverage. They could spread the cost across their entire pool of employees with family coverage. Or they could charge families that elect to cover their young adults a separate premium, likely higher. ‘There is no free lunch, so there will be an incremental cost,’ said Ron Fontanetta, a principal with the consulting firm TowersWatson. He believes a majority of employers will keep things simple and raise overall family premiums modestly. But it may still be noticeable — 5 percent to 10 percent.” (Ricardo Alonso-Zaldivar, “Some Families Will Face Wait To Cover Young Adults,” The Associated Press, 4/27/10)

WILL PUT STATE BUDGETS ON THE BRINK WITH NEW UNFUNDED MANDATES …

“The First Real Test Of How Cooperative The States Will Be In Implementing The Massive New Health Care Reform Law Comes On Friday, And Early Indications Are That It’s Going To Be At Best A Bumpy Road. On Friday, states must decide whether to help the Department of Health and Human Services set up or expand high-risk insurance pools by the June 21 deadline set in the law, or, in the alternative, leave HHS to do it all by itself.” (Jennifer Haberkorn, “States Wary Of High-Risk Health Pools,” Politico, 4/27/10)

• “Many States Are Concerned That The $5 Billion HHS Has To Implement The Program Will Quickly Run Dry, Leaving Cash-Strapped States With Another Tab.” (Jennifer Haberkorn, “States Wary Of High-Risk Health Pools,” Politico, 4/27/10)

Georgia Insurance Commissioner Says His State Will Opt Out Because Financial Responsibility Will Fall On Georgians “In The Form Of An Unfunded Mandate.” “Georgia Insurance Commissioner John W. Oxendine, a Republican candidate for governor, said his state won’t implement the high-risk pool program because it will ‘ultimately become the financial responsibility of Georgians in the form of an unfunded mandate,’ he wrote in a letter to HHS Secretary Kathleen Sebelius.” (Jennifer Haberkorn, “States Wary Of High-Risk Health Pools,” Politico, 4/27/10)

Kansas Insurance Department Has Questions About Costs, Eligibility And Is Looking For Answers. “In Kansas, insurance officials have questions about costs and eligibility, among other factors. ‘The concern that they had, and I think it’s similar to all the other states, is there were a whole lot of questions and not a lot of answers,’ said Linda Shepphard, director of the accident and health division at the Kansas Insurance Department.” (Jennifer Haberkorn, “States Wary Of High-Risk Health Pools,” Politico, 4/27/10)

Louisiana Insurance Commissioner Says His State Will Opt Out Because “We Can’t Afford This.” “Louisiana Gov. Bobby Jindal and Insurance Commissioner James J. Donelon have made a preliminary decision to opt out of the program, Donelon said Monday. He is a Republican and one of the dozen elected insurance commissioners in the country. But he said Louisiana’s decision was based largely on the concern that the states will be stuck with the bill. ‘On the surface, it appears to me to be a no-brainer,’ Donelon said. ‘We can’t afford this.’” (Jennifer Haberkorn, “States Wary Of High-Risk Health Pools,” Politico, 4/27/10)

AND WILL DECREASE ACCESS TO MEDICAL CARE

Large Employers Will Drop Coverage, Dump Employees Onto Exchange Plans Without The Same “Generous Benefits.” “Some health-care benefits managers… see a future in which employers no longer provide coverage because the cost of dropping health insurance for employees, about $2,000 per person in federal penalties to employers, is far less than the current cost of providing family coverage, about $12,000 per employee… [L]arge employers… are skeptical that coverage offered through the new insurance exchanges envisioned by the Obama plan will improve on what they are doing. Some of these employers are rightly proud of their plans because of their generous benefits… ut since the government would pick up much of the cost for low-income workers were they to go to the public exchanges, the incentives for retaining a company plan might erode. Indeed, she said, shareholders might reasonably ask why a company continued to offer such a plan when it could easily cut costs by sending employees to an exchange.” (Chris Mondics, “Employers Looking For Health-Care Answers,” The Philadelphia Inquirer, 4/27/10)