Research Briefing

ObamaCare And Its Unconstitutional Mandate Drives Up Health Care Costs, Increases Insurance Premiums, Hurts The Quality Of Health Care, Raises Taxes, And Blows Up The Deficit

The Evidence:

1.        Increases Health Care Costs

2.        Causes Insurance Premiums To Rise

3.        Hurts Quality Of Health Care

4.        Nearly $570 Billion In Tax Hikes

5.        Adds Over $500 Billion To The Debt

1.     INCREASES HEALTH CARE COSTS

Medicare’s Chief Actuary Richard Foster Said ObamaCare Won’t Keep Costs Down. “The landmark legislation probably won't hold costs down, and it won't let everybody keep their current health insurance if they like it, Chief Actuary Richard Foster told the House Budget Committee. His office is responsible for independent long-range cost estimates.”  (Ricardo Alonso-Zaldivar, “Medicare Offical Doubts Health Care Law Savings,” The Associated Press, 1/26/11)

Foster Was Asked To Respond True Or False In Regards To The Claim That ObamaCare Will Bring Down Health Care Costs.  “Foster was asked by Rep. Tom McClintock, R-Calif., for a simple true or false response on two of the main assertions made by supporters of the law: that it will bring down unsustainable medical costs and will let people keep their current health insurance if they like it.”  (Ricardo Alonso-Zaldivar, “Medicare Offical Doubts Health Care Law Savings,” The Associated Press, 1/26/11)

• “On The Costs Issue, ‘I Would Say False, More So Than True,’ Foster Responded.”  (Ricardo Alonso-Zaldivar, “Medicare Offical Doubts Health Care Law Savings,” The Associated Press, 1/26/11)

CMS Says Health Care Spending Will Increase More Than Before ObamaCare Was Passed. “In February, the federal Centers for Medicare and Medicaid Services projected that overall national health spending would increase an average of 6.1% a year over the next decade. The center's economists recalculated the numbers in light of the health bill and now project that the increase will average 6.3% a year, according to a report in the journal Health Affairs. Total U.S. health spending will reach $4.6 trillion by 2019, accounting for nearly one of every five U.S. dollars spent, the report says.”  (Janet Adamy, “Health Outlays Still Seen Rising,” The Wall Street Journal, 9/9/10)

• “U.S. Health Spending Is Projected To Rise 9.2% In 2014, Up From The 6.6% Projected Before The Law Took Effect.” (Janet Adamy, “Health Outlays Still Seen Rising,” The Wall Street Journal, 9/9/10)

2.     CAUSES INSURANCE PREMIUMS TO RISE

Health Insurers Will Need To Increase Premiums Between 1% And 9% As A Result Of ObamaCare.  “Health insurers say they plan to raise premiums for some Americans as a direct result of the health overhaul in coming weeks, complicating Democrats' efforts to trumpet their signature achievement before the midterm elections. Aetna Inc., some BlueCross BlueShield plans and other smaller carriers have asked for premium increases of between 1% and 9% to pay for extra benefits required under the law, according to filings with state regulators.” (Janet Adamy, "Health Insurers Plan Hikes," The Wall Street Journal, 9/8/10)

Premiums For Families Will Increase By $2,100 As A Result Of ObamaCare. “Average premiums per policy in the nongroup market in 2016 would be roughly $5,800 for single policies and $15,200 for family policies under the proposal, compared with roughly $5,500 for single policies and $13,100 for family policies under current law.”  (Douglas W. Elmendorf, CBO Director, Letter To Senator Evan Bayh, 11/30/09)

Premiums Plus Out-Of-Pocket Costs Are Expected To Increase By 12.4 Percent In 2011.  “In 2011, the combined average of premium and out-of-pocket costs for health care coverage for an employee is projected to climb to $4,386, according to an annual study by Hewitt Associates to be released this week. That's a 12.4 percent increase, or $486, over this year.” (Bruce Jaspen, “Higher Health Care Bills Ahead,” Chicago Tribune, 9/27/10)

3.     HURTS QUALITY OF HEALTH CARE

Doctor Shortage Will Worsen Because Of ObamaCare, Leading To “More-Limited Access To Health Care And Longer Wait Times For Patients.” “The new federal health-care law has raised the stakes for hospitals and schools already scrambling to train more doctors. Experts warn there won’t be enough doctors to treat the millions of people newly insured under the law. At current graduation and training rates, the nation could face a shortage of as many as 150,000 doctors in the next 15 years, according to the Association of American Medical Colleges….The greatest demand will be for primary-care physicians. … A shortage of primary-care and other physicians could mean more-limited access to health care and longer wait times for patients.” (Suzanne Sataline & Shirley Wang, “Medical Schools Can’t Keep Up,” The Wall Street Journal, 4/12/10)

Increased Demand From ObamaCare Will Lead To Rising Costs For Families And Doctors Refusing Patients. “However, the report raises several warnings about the impact of healthcare reform. Foster states, ‘The additional demand for health services could be difficult to meet initially with existing health resources and could lead to price increases, cost shifting, and/or changes in providers’ willingness to treat patients with low-reimbursement health coverage.’” (Bob Cusack, “Government Report: New Healthcare Reform Law Could Lead To Higher Prices, Employers Dropping Coverage,” The Hill, 4/22/10)

ObamaCare May Increase Crowding At ERs. “Emergency rooms, the only choice for patients who can't find care elsewhere, may grow even more crowded with longer wait times under the nation's new health law.  That might come as a surprise to those who thought getting 32 million more people covered by health insurance would ease ER crowding. It would seem these patients would be able to get routine health care by visiting a doctor's office, as most of the insured do.”  (Carla K. Johnson, “Health Overhaul May Mean Longer ER Waits, Crowding?” The Associated Press, 7/2/10)

Increase In Medicaid Patients Will “Put Even More Pressure On The Strained Network Of Medicaid Providers.” “The influx of new patients is likely to put even more pressure on the strained network of Medicaid providers. Many of the new patients are likely to be in their 50s and early 60s, with complex medical problems, including mental health issues, said Peter J. Cunningham, senior fellow at the Center for Studying Health System Change.” (Roni Caryn Rabin, “With Expanded Coverage For The Poor, Fears Of A Big Headache,” The New York Times, 4/26/10)

4.     NEARLY $570 BILLION IN TAX HIKES

Obama Pays For His Government Takeover Of Health Care With Nearly $570 Billion In Job-Destroying Taxes On Small Businesses, Investments And Innovation. (Douglas W. Elmendorf, Letter To Nancy Pelosi, Congressional Budget Office, 3/20/10; “Estimated Revenue Effects Of The Amendment In The Nature Of A Substitute To H.R. 4872: JCX-17-10,” Joint Committee On Taxation, 3/20/10)

“About One-Third Of Employers Subject To Major Requirements Of The New Health Care Law May Face Tax Penalties Because They Offer Health Insurance That Could Be Considered Unaffordable To Some Employees, A New Study Says.” (Robert Pear, “Study Points to Health Law’s Penalties,” The New York Times, 5/23/10)

• “If An Employer With 50 Full-Time Employees Offers Coverage And 10 Of Those Workers Receive Premium Credits, Or Subsidies, The Employer Would Face A Penalty Of $30,000. If 30 Workers Receive Subsidies, The Penalty Would Be $40,000.” (Robert Pear, “Study Points to Health Law’s Penalties,” The New York Times, 5/23/10)

5.     ADDS OVER $500 BILLION TO THE DEBT

The Associated Press: “The Idea That Obama's Health Care Law Saves Money For The Government Is Based On Assumptions That Are Arguable, At Best.”  (Calvin Woodward, “Fact Check: Obama Ledger Out Of Balance,” The Associated Press, 1/25/11)

• ObamaCare’s Savings Claims Are “Unrealistic.”  “To be sure, the nonpartisan Congressional Budget Office has estimated the law will slightly reduce red ink over 10 years. But the office's analysis assumes that steep cuts in Medicare spending, as called for in the law, will actually take place. Others in the government have concluded it is unrealistic to expect such savings from Medicare.” (Calvin Woodward, “Fact Check: Obama Ledger Out Of Balance,” The Associated Press, 1/25/11)

Washington Post Editorial Board Says The Obama-Reid-Pelosi Bill Pretends To Be Budget Neutral Because Of “A Fiscal Sleight Of Hand.” “First off, $247 billion -- the 10-year cost of the fix -- is one whopper of a ‘discrepancy.’ … President Obama has vowed that health reform will not add a single dime to the deficit -- but he is seemingly unfazed about adding more than a quarter-trillion dollars to the deficit by changing the Medicare reimbursement formula without finding a way to pay for it. … This latest maneuver only heightens the fiscal irresponsibility of what already was a fiscal sleight of hand.” (Editorial, “2.47 Trillion Dimes,” The Washington Post, 10/19/09)

Former CBO Director Douglas Holtz-Eakin: Without “Gimmicks And Budgetary Games,” The Health Care Reform Legislation Increases Deficits By $562 Billion. “In reality, if you strip out all the gimmicks and budgetary games and rework the calculus, a wholly different picture emerges: The health care reform legislation would raise, not lower, federal deficits, by $562 billion.” (Douglas Holtz-Eakin, Op-Ed, “The Real Arithmetic Of Health Care Reform,” The New York Times, 3/21/10)

• Which Includes $114 Billion To Implement ObamaCare. “Even worse, some costs are left out entirely. To operate the new programs over the first 10 years, future Congresses would need to vote for $114 billion in additional annual spending. But this so-called discretionary spending is excluded from the Congressional Budget Office’s tabulation.” (Douglas Holtz-Eakin, Op-Ed, “The Real Arithmetic Of Health Care Reform,” The New York Times, 3/21/10)