Research Briefing

It’s Been A Rough First Year For ObamaCare

Since ObamaCare Passed:

• Democrats’ Cost Projections Proved Overly Rosy
  
• Cash-Strapped States Were Stuck With Unfunded Mandates
  
• Premiums Are Rising, Not Falling As We Were Told
  
• The Individual Mandate Was Ruled Unconstitutional
  
• Over 1,000 Organizations Have Received Coverage Waivers
  
• 34 States No Longer Offer Child-Only Policies
  
• And Americans Still Strongly Dislike The Bill

DEMOCRATS’ COST PROJECTIONS PROVED OVERLY ROSY

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)

• AP: ObamaCare’s Savings From Medicare 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)

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)

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)

CASH-STRAPPED STATES WERE STUCK WITH UNFUNDED MANDATES

As A Result Of ObamaCare, 16 Million People Will Be Forced To Go On Medicaid. “Perhaps the reason is that the health overhaul is designed to enroll 16 million new people in Medicaid and many of them will be giving up their private insurance in the process.  In fact, people who acquire health insurance on their own will be required to enroll in Medicaid and will not be allowed access to the new, state-based health insurance exchanges if their income is below 133% of the poverty level.”  (John Goodman, “Medicaid Rescissions Worse Than Private Insurers,” Kaiser Health News, 8/12/10)

Resistance To ObamaCare Has Already Emerged, As State Legislatures Have Rejected Bills To Create Insurance Exchanges, And Governors Are Looking To Slow Down Medicaid Expansion. “But resistance to the new law has already emerged in several statehouses. Legislatures in Minnesota and Rhode Island in the last year have rejected bills to create insurance exchanges. … Now, several governors are also looking at ways to slow down a major expansion of the Medicaid program, the federal-state insurance program originally designed for poor children.” (Noam N. Levey And Bruce Japsen, “States, Not Congress, Can Thwart Healthcare Law,” Los Angeles Times, 11/7/10)

• It Will Be Difficult For Financially Strapped States To Shoulder Expected Increases.  “While the federal government is to provide most of the new funding, some state analysts predict it will be difficult for financially strapped states to shoulder even a small increase. ‘This recession was so big and broad and wide that it will have repercussions for a decade or more,’ said Ray Scheppach, executive director of the National Governors Assn. State lawmakers may also resist efforts by the Obama administration to expand state oversight of insurance premiums, a key goal of the new healthcare law.” (Noam N. Levey And Bruce Japsen, “States, Not Congress, Can Thwart Healthcare Law,” Los Angeles Times, 11/7/10)

PREMIUMS ARE RISING, NOT FALLING AS WE WERE TOLD

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)

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)
• “The Nation's Health Care Tab Will Go Up — Not Down — As A Result Of President Barack Obama's Sweeping Overhaul.” (“Health Care Spending Will Increase After Overhaul, But Not By Much,” The Associated Press, 9/9/10)

THE INDIVIDUAL MANDATE IS A “RADICAL DEPARTURE” FROM THE LAW

In The “Biggest Setback” To ObamaCare, A Federal Judge Ruled That The Individual Mandate “Exceeds The Constitutional Boundaries Of Congressional Power.” “A federal court ruled Monday that a central plank of the health law violates the Constitution, dealing the biggest setback yet to the Obama administration's signature legislative accomplishment.  In a 42-page ruling, U.S. District Judge Henry E. Hudson said the law's requirement that most Americans carry insurance or pay a penalty ‘exceeds the constitutional boundaries of congressional power.’”  (Janet Adamy, “Judge Cans Health Law Unconstitutional,” The Wall Street Journal, 12/13/10)

The Wall Street Journal: “The Administration contends that not purchasing insurance—inactivity—is really activity, because everyone will eventually need medical care and their costs will be transferred to the insured. But Judge Vinson dissects that as a ‘radical departure’ from the Constitution and U.S. case law.”  (Editorial, “The Constitutional Moment,” The Wall Street Journal, 2/1/11)

OVER 1,000 ORGANIZATIONS HAVE RECEIVED OBAMACARE WAIVERS

The Obama Administration Has Granted Over 1,000 Waivers To Employers That Cannot Meet The Laws Requirements. “The number of temporary healthcare reform waivers granted by the Obama administration to organizations climbed to more than 1,000, according to new numbers disclosed by the Department of Health and Human Services.” (Jason Millman, “Number Of Healthcare Reform Law Waivers Climbs Abover 1,000,” The Hill, 3/6/11)

The Waivers Are Necessary Because Otherwise Workers Would Lose Their Health Insurance Due To ObamaCare’s Expensive Requirements. “Thirty companies and organizations, including McDonald's (MCD) and Jack in the Box (JACK), won't be required to raise the minimum annual benefit included in low-cost health plans, which are often used to cover part-time or low-wage employees. The Department of Health and Human Services, which provided a list of exemptions, said it granted waivers in late September so workers with such plans wouldn't lose coverage from employers who might choose instead to drop health insurance altogether.” (Drew Armstrong, “McDonald’s. 29 Other Frims Get Health Care Coverage Waivers,” USA Today, 10/7/10)

34 STATES NO LONGER OFFER CHILD-ONLY POLICIES

“At Least Six Major Companies — Including Anthem, Aetna, Cigna And Humana — Have Said They Will Stop Writing New Policies For Individual Children Not Covered By Their Parents' Or Other Plans, Insurance Officials Said.”  (Michael Booth, “Health Insurers Seek Rate Hikes, Citing New Reform Law,” The Denver Post, 9/20/10) 

A New Report Finds That As A Result Of ObamaCare, 34 States No Longer Offer Child-Only Insurance Policies.  “Health insurers in 34 states have stopped selling child-only insurance policies as a result of the health reform law, and the market continues to destablize. … Since September, the health reform law has barred insurers from withholding policies to children under 19 who have a pre-existing condition. Rather than take on the burdensome cost of writing policies for potentially-pricey medical conditions, many carriers decided to leave the market altogether.”  (Sarah Kliff And J. Lester Feder, “Child-Only Health Plans Endangered,” Politico, 1/27/11)

• “One Of The Largest Insurance Markets In The Country, Texas, Has Seen All Their Carriers Drop Child-Only Health Insurance, As Have Other Large States Including Florida And Illinois.” (Sarah Kliff And J. Lester Feder, “Child-Only Health Plans Endangered,” Politico, 1/27/11)
• “Other States That No Longer Have Carriers Selling Child-Only Plans Include Alaska, Arizona, Connecticut, Delaware, Georgia, Minnesota, Nebraska, Nevada, New Mexico, North Dakota, Oklahoma, Rhode Island, South Carolina, Tennessee, Utah, West Virginia And Wyoming ….” (Sarah Kliff And J. Lester Feder, “Child-Only Health Plans Endangered,” Politico, 1/27/11)

AND AMERICANS STILL STRONGLY DISLIKE THE BILL 

Obama Advisor Valerie Jarrett: “We Are Confident That The American People Will Support This” Because “It’s Good For Them.” “Valerie Jarrett, a senior adviser to President Barack Obama, said people will begin to support the law when they learn more about it because ‘it’s good for them.’ ‘We are confident that the American people will support this,’ Jarrett said on ABC’s ‘This Week.’” (Alexander Bolton, “Schumer: Those Who Voted Against Healthcare Will Be Hurt In November,” The Hill, 3/28/10)

• HHS Secretary Sebelius Said The American People Just Didn’t Understand The Law, But When They Did They’d Be “Enthusiastic” About ObamaCare. “Secretary of Health and Human Services Kathleen Sebelius says that, despite a new CBS News poll showing widespread skepticism and confusion, Americans will be ‘enthusiastic’ about the health reform bill passed by the House of Representatives once they understand it. ‘I think what's been going on for the better part of a year is a lot of attempts to confuse and scare Americans,’ Sebelius told ‘Early Show’ co-anchor Maggie Rodriguez.” (Tucker Reals, “Sebelius: Americans Will Embrace Health Reform,” CBS News, 3/22/10)

65 Percent Of Americans Oppose ObamaCare’s Individual Mandate.  (Bloomberg, 1,001 A, MoE 3.1%, 3/4-7/11)

50 Percent Of Americans Oppose Most Or All Of ObamaCare. (CNN Opinion Research, 1,014 A MoE 3%, 1/14-16/11)

• Only 6 Percent Of Americans Favor The Entire Bill. (CNN Opinion Research, 1,014 A MoE 3%, 1/14-16/11)

50 Percent Of Americans Want All Of ObamaCare Repealed. (CNN Opinion Research, 1,014 A MoE 3%, 1/14-16/11)