By Rep. Michele Bachmann — As unemployment surpasses 10 percent, Congress continues to vow that job creation is a top priority. After the $1.1 trillion stimulus failed to prevent unemployment from rising above 8 percent as its proponents promised, lawmakers are feeling the heat from American families as they struggle to pay for their mortgage, college tuition, and healthcare.
Just last month, 190,000 jobs were lost. All year long, Democrats in Washington have been on a spending spree, claiming that the only way to save the economy from ruin was by spending big. Now House Democrats are using the same excuse to allow the government to take over our nation’s healthcare industry at the steep price tag of $1.3 trillion.
As the House debated the controversial bill late on a Saturday night, Democrats promised that their healthcare reform would help small businesses, lower their premiums, and offer affordable healthcare for all Americans. One of my colleagues on the other side of the aisle said it would “strengthen small businesses so they will be critical engines of growth in our communities.” Another lawmaker even went so far as to promise that the government takeover would reduce insurance costs for 14,800 small businesses in his district.
Many supporters of Pelosicare seemed to sympathize with small businesses and the strain that healthcare premiums place on these job creators. This is a noble goal and one that I share. But, it’s exactly why I oppose any legislation that would place the central control of our nation’s healthcare industry into the hands of the federal government. If costs and job growth is their top concern as my colleagues adamantly proclaimed on the House floor, they should also oppose Pelosicare.
Unfortunately, the rhetoric we are hearing does not reflect reality. Research shows that Speaker Nancy Pelosi’s (D-Calif.) healthcare would not decrease costs for American families and small businesses. How can it when $729.5 billion of new taxes are imposed on the same small businesses and individuals who are already struggling to afford health coverage?
This government takeover of healthcare allows an unprecedented level of government interference. Section 202 of the House bill requires individuals to enroll in a qualified plan. Meanwhile, Section 303 explains this bill does not design the qualified plan. However, small businesses and American families can be certain this bill does design the new taxes and fines to which they will be subjected. Essentially, the American people are being forced to sign on the dotted line and pay for a product they have not yet seen.
Section 202 also provides a “grace period” for businesses to meet the qualified plan. Under this bill, businesses will be forced to reevaluate the benefits they are currently providing and adjust them to the standards created by a new bureaucracy that is unfamiliar with the needs of the company’s employees. If these businesses are unable to afford the new government mandates, they will be subject to an 8 percent payroll tax.
The House-approved healthcare overhaul would raise the costs of healthcare by $289 billion over the next 10 years, according to an analysis by the chief actuary at the Centers for Medicare and Medicaid Services (CMS).
The CMS report is a blow to the White House and House Democrats who have vowed that healthcare reform would curb the growth of healthcare spending. CMS’s analysis is not an apples-to-apples comparison to the cost estimate conducted by the Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT) because CMS did not review tax provisions, which help offset the price tag of the Democrats’ measure.
However, the CMS analysis clearly states that the House bill falls short in attaining a key goal of the Democrats’ effort to reform the nation’s healthcare system: “With the exception of the proposed reduction in Medicare… the provisions of H.R. 3962 would not have a significant impact on future healthcare cost growth rates.”
Republicans immediately seized on CMS’s conclusions.
The long-awaited report should serve as a “stark warning to every Republican, Democrat and Independent worried about the future of this nation,” Ways and Means Committee ranking member Dave Camp (R-Mich.) said in a statement on Saturday.
Though House Republicans pressed to have this analysis completed before the lower chamber voted on the Democrats’ sweeping healthcare reform bill last week, it was not ready until late Friday. Chief CMS Actuary Richard Foster, who prepared the report, recently told The Hill that he and his staff had only a few days to review the bill before it was voted on.
Meet the unelected body that will dictate future medical decisions.
As usual, the most dangerous parts of ObamaCare aren’t receiving the scrutiny they deserve—and one of the least examined is a new commission to tell Congress how to control health spending. Democrats are quietly attempting to impose a “global budget” on Medicare, with radical implications for U.S. medicine.
Like most of Europe, the various health bills stipulate that Congress will arbitrarily decide how much to spend on health care for seniors every year—and then invest an unelected board with extraordinary powers to dictate what is covered and how it will be paid for. White House budget director Peter Orszag calls this Medicare commission “critical to our fiscal future” and “one of the most potent reforms.”
On that last score, he’s right. Prominent health economist Alain Enthoven has likened a global budget to “bombing from 35,000 feet, where you don’t see the faces of the people you kill.”
As envisioned by the Senate Finance Committee, the commission—all 15 members appointed by the President—would have to meet certain budget targets each year. Starting in 2015, Medicare could not grow more rapidly on a per capita basis than by a measure of inflation. After 2019, it could only grow at the same rate as GDP, plus one percentage point.
The theory is to let technocrats set Medicare payments free from political pressure, as with the military base closing commissions. But that process presented recommendations to Congress for an up-or-down vote. Here, the commission’s decisions would go into effect automatically if Congress couldn’t agree within six months on different cuts that met the same target. The board’s decisions would not be subject to ordinary notice-and-comment rule-making, or even judicial review.
Yet if the goal really is political insulation, then the Medicare Commission is off to a bad start. To avoid a senior revolt, Finance Chairman Max Baucus decided to bar his creation from reducing benefits or raising the eligibility age, which meant that it could only cut costs by tightening Medicare price controls on doctors and hospitals. Doctors and hospitals, naturally, were furious.
It’s too bad the health care overhaul that House Democrats narrowly approved last week isn’t a medical product. If it were, it would have to come with a warning label, Which could read something like this:
WARNINGS:
•This product will increase your health insurance premiums. Millions who are satisfied with their current, low-cost health plans would have to switch to more expensive plans, solely because Congress decided they weren’t buying enough coverage.
The legislation would increase premiums even further over time, as drug companies, chiropractors, acupuncturists, fertility specialists and other special interests lobby Congress to force you to purchase coverage for their services too.
•This product will reduce the quality of your health care. America’s health care sector is often inconvenient, poorly coordinated, and makes less use of information technology than your local supermarket. Research shows that medical errors kill as many as 100,000 Americans per year.
Markets would solve those problems, but government thwarts doctors and entrepreneurs who try to improve quality. Medicare – by far the largest purchaser of medical services in the world – actually penalizes doctors and hospitals that reduce medical errors.
The House bill would cement those deficiencies in place with yet another massive government program, and create new quality problems, like insurers skimping on care and customer service for the sickest patients.
•This product probably won’t make you healthier. The House bill would expand coverage, but at a steep cost and with zero evidence that doing so is a cost-effective way of improving health.
Little research supports the notion that broadly expanding insurance coverage makes people healthier. Medicare established near-universal coverage for the elderly, yet research shows that program didn’t save a single life in its first 10 years of operation. Whether it has had any subsequent impact on mortality rates – positive or negative – remains an open question.
•This product will make you poorer. The House bill contains at least $2 trillion in explicit and implicit taxes. Tax rates for wealthy Americans would rise to 45 percent, with an ever-expanding definition of “wealthy.” For the middle class, effective tax rates would average 60 percent to 70 percent and exceed 100 percent in some cases.
•This product will make your children poorer. Since the bill would actually increase the federal budget deficit, the tax burden would grow over time.
The bill purports to cut Medicare spending, but those cuts are not likely to happen. Want proof? At the same time House Democrats promise future spending cuts, they are gutting $210 billion of spending cuts promised by past Congresses.
Dr. Toby Cosgrove, the leader of the Obama-praised Cleveland Clinic, predicts that in the next four to five years Americans will demand another health reform bill because the proposals moving through Congress do little to control costs.
The House bill passed last weekend and two Senate proposals fail to make the health system more efficient, and do not do enough to help Americans get healthy, Cosgrove said during a speech at Jones Day law firm in downtown Cleveland Tuesday.
“Without controlling obesity, and without controlling smoking, and without dealing with wellness, it’s going to be very difficult for us to ever control the cost of health care in the United States, and the current bills do very little along those lines,” Cosgrove said.
The president has praised the Clinic, as well as the Mayo Clinic, as models of low-cost and high-quality care. The reference comes from statistics in the Dartmouth Atlas of Health Care 2008, a report from the Dartmouth Institute for Health Policy and Clinical Policy, a research and educational institution in New Hampshire.
Nancy Pelosi has unveiled the new health care bill in the House after merging together three different versions of legislation. To appease moderate Blue Dog Democrats and to meet President Obama’s oft-stated promise that reform wouldn’t cost more than $900 billion in the first ten years, Speaker Pelosi sought to reduce the $1.5 trillion total cost of the bill. Newsflash: she failed.
The Congressional Budget Office released its preliminary score of the bill and while some in the media have been reporting its net cost of $894 billion, the total cost of health reform legislation is more like $1.5 trillion. So, Speaker Pelosi is essentially right back where she started—with a huge 2,000 page plan that carries a hefty price tag.
Washington is captivated by the Senate melodrama over the so-called public option, salivating at the ring of Harry Reid’s political bell (see below). But the most important health-care questions continue to be about the policy substance—particularly those that Democrats don’t want asked.
Foremost among them is: How will ObamaCare affect insurance premiums in the private health-care markets? Despite indignant Democratic denials, the near-certainty is that their plan will cause costs to rise across the board. The latest data on this score come from a series of state-level studies from the insurance company WellPoint Inc.
At the request of Congressional delegations worried about their constituents—call it a public service—WellPoint mined its own actuarial data to model ObamaCare in the 14 states where it runs Blue Cross plans. The study therefore takes into account market and demographic differences that other industry studies have not, such as the one from the trade group America’s Health Insurance Plans, which looked at aggregate national trends.
In all of the 14 states WellPoint scrutinized, ObamaCare would drive up premiums for the small businesses and individuals who are most of WellPoint’s customers. (Other big insurers, like Aetna, focus on the market among large businesses.) Young and healthy consumers will see the largest increases—their premiums would more than triple in some states—though average middle-class buyers will pay more too.
Not even two hours after Wellpoint had presented its materials on the Hill, Democrats were already trashing it—which, considering that it runs to some 238 pages and took weeks to prepare, must have required remarkable powers of digestion and analysis.
WASHINGTON (AP) — Quick quiz: What do these enterprises have in common? Farm and construction machinery, Tupperware, the railroads, Hershey sweets, Yum food brands and Yahoo? Answer: They’re all more profitable than the health insurance industry.
In the health care debate, Democrats and their allies have gone after insurance companies as rapacious profiteers making ”immoral” and ”obscene” returns while ”the bodies pile up.”
Ledgers tell a different reality. Health insurance profit margins typically run about 6 percent, give or take a point or two. That’s anemic compared with other forms of insurance and a broad array of industries, even some beleaguered ones.
Profits barely exceeded 2 percent of revenues in the latest annual measure. This partly explains why the credit ratings of some of the largest insurers were downgraded to negative from stable heading into this year, as investors were warned of a stagnant if not shrinking market for private plans.
Insurers are an expedient target for leaders who want a government-run plan in the marketplace. Such a public option would force private insurers to trim profits and restrain premiums to compete, the argument goes. This would ”keep insurance companies honest,” says President Barack Obama.
The debate is loaded with intimations that insurers are less than straight, when they are not flatly accused of malfeasance.
Washington has just run a $1.4 trillion budget deficit for fiscal 2009, even as we are told a new health-care entitlement will reduce red ink by $81 billion over 10 years. To believe that fantastic claim, you have to ignore everything we know about Washington and the history of government health-care programs. For the record, we decided to take a look at how previous federal forecasts matched what later happened. It isn’t pretty.
Let’s start with the claim that a more pervasive federal role will restrain costs and thus make health care more affordable. We know that over the past four decades precisely the opposite has occurred. Prior to the creation of Medicare and Medicaid in 1965, health-care inflation ran slightly faster than overall inflation. In the years since, medical inflation has climbed 2.3 times faster than cost increases elsewhere in the economy. Much of this reflects advances in technology and expensive treatments, but the contrast does contradict the claim of government as a benign cost saver.
Next let’s examine the record of Congressional forecasters in predicting costs. Start with Medicaid, the joint state-federal program for the poor. The House Ways and Means Committee estimated that its first-year costs would be $238 million. Instead it hit more than $1 billion, and costs have kept climbing.
Thanks in part to expansions promoted by California’s Henry Waxman, a principal author of the current House bill, Medicaid now costs 37 times more than it did when it was launched—after adjusting for inflation. Its current cost is $251 billion, up 24.7% or $50 billion in fiscal 2009 alone, and that’s before the health-care bill covers millions of new beneficiaries.
Medicare has a similar record. In 1965, Congressional budgeters said that it would cost $12 billion in 1990. Its actual cost that year was $90 billion. Whoops. The hospitalization program alone was supposed to cost $9 billion but wound up costing $67 billion. These aren’t small forecasting errors. The rate of increase in Medicare spending has outpaced overall inflation in nearly every year (up 9.8% in 2009), so a program that began at $4 billion now costs $428 billion.
On Monday, October 19, Senator Jon Kyl of Arizona shared with his colleagues in the Senate what he has been hearing from his constituents on Health Care Reform. Senator Kyl gave a 20-minute presentation in which he aptly articulated the concerns most Americans are expressing about the Health Care Reform bill. Although it is a bit long, this is a “must-see” speech for everyone who cares about the future of health care in America.
By Douglas Holtz-Eakin — Remember when health-care reform was supposed to make life better for the middle class? That dream began to unravel this past summer when Congress proposed a bill that failed to include any competition-based reforms that would actually bend the curve of health-care costs. It fell apart completely when Democrats began papering over the gaping holes their plan would rip in the federal budget.
As it now stands, the plan proposed by Democrats and the Obama administration would not only fail to reduce the cost burden on middle-class families, it would make that burden significantly worse.
Consider the bill put forward by the Senate Finance Committee. From a budgetary perspective, it is straightforward. The bill creates a new health entitlement program that the Congressional Budget Office (CBO) estimates will grow over the longer term at a rate of 8% annually, which is much faster than the growth rate of the economy or tax revenues. This is the same growth rate as the House bill that Sen. Kent Conrad (D., N.D.) deep-sixed by asking the CBO to tell the truth about its impact on health-care costs.
To avoid the fate of the House bill and achieve a veneer of fiscal sensibility, the Senate did three things: It omitted inconvenient truths, it promised that future Congresses will make tough choices to slow entitlement spending, and it dropped the hammer on the middle class.
One inconvenient truth is the fact that Congress will not allow doctors to suffer a 24% cut in their Medicare reimbursements. Senate Democrats chose to ignore this reality and rely on the promise of a cut to make their bill add up. Taking note of this fact pushes the total cost of the bill well over $1 trillion and destroys any pretense of budget balance.
It is beyond fantastic to promise that future Congresses, for 10 straight years, will allow planned cuts in reimbursements to hospitals, other providers, and Medicare Advantage (thereby reducing the benefits of 25% of seniors in Medicare). The 1997 Balanced Budget Act pursued this strategy and successive Congresses steadily unwound its provisions. The very fact that this Congress is pursuing an expensive new entitlement belies the notion that members would be willing to cut existing ones.
The Senate Finance Committee, chaired by Sen. Max Baucus (D-Mont.), claimed it posted the “full text” of its health care reform bill, “America’s Healthy Future Act,” on its Web site. But when users clicked the link to read the proposed law, they could only access a 259-page document that included summaries of both current law and the proposed legislation–or what some senators called a “plain English” version of the bill.
The actual “legislative language” of the bill–the words that would become the law of the land if the bill were enacted–is not available to the public and apparently has not even been written.
Nonetheless, the Congressional Budget Office (CBO) scored the plain text summary of the bill on Oct. 7, cautiously estimating its cost at $829 billion. The members of the committee voted the bill out of the committee based on the summary on Tuesday, 14-9, picking up only one Republican vote, Sen. Olympia Snowe of Maine.
While the committee released a memorandum to reporters and editors on Oct. 2 claiming had released the “full text of the America’s Healthy Future Act,” the link attached to the online version of the memorandum led to the summary–not an actual legislative text–and the CBO’s Oct. 7 “preliminary analysis” of the bill contradictng the committee’s claim that it had released the “full text.”
“The Chairman’s mark, as amended, has not yet been converted into legislative language,” said the CBO. ”The review of such language could lead to significant changes in the estimates of the proposal’s effects on the federal budget and insurance coverage.”
The Senate Finance Committee bill written by Chairman Max Baucus (D-Mont.) (the Baucus bill) will drive up the cost of health insurance for all Americans and then force everyone to buy it or face tax penalties or jail time. While the Baucus bill does cap out-of-pocket costs based on a person’s income, the effect on American families is still staggering, says PricewaterhouseCoopers.
Other findings:
For individuals making $34,140 (three times the Federal Poverty Level) the Baucus health care proposal could mandate up to $4,097 in annual premiums, a sum which could have been spent on over nine months of food, almost four months of housing or well over a year of utilities.
For a family of four making $69,480 (300 percent above poverty) the Baucus bill mandates annual health insurance premiums of $8,338, which would be worth the equivalent of over 10 months of food, four months of housing or almost two years of utilities.
For individuals earning $45,520 (400 percent above poverty) Baucus mandates $5,462 for health insurance, or over a year of food, four months of rent or a year and a half of utilities.
For families earning $92,640 (400 percent above poverty) Baucus mandates $11,117 in health premiums, the equivalent of over a year of food, five months of housing or two years of utilities.
Those numbers include the subsidies for health insurance in the Baucus bill. To pay for all this new health care spending, plus the massive expansion of Medicaid, the Congressional Budget Office (CBO) estimates that the Baucus bill will collect $4 billion in fines from those who do not purchase insurance, $200 billion taxing health insurance companies with generous health plans, and $25 billion in taxes on employers. Not to mention the billions in cuts to Medicare payments to hospitals which will result in significant cost shifting to consumers.
Instead of reducing the average family’s health insurance premiums by $2,500 per year, as President Obama promised, the Baucus bill would actually raise them by $4,000 more than they would have been without reform. The Baucus bill spends at least $1 trillion, fails to cover all Americans, taxes employers for creating jobs, and inflicts higher out-of-pocket health care costs on all Americans.
Source: Report, “Potential Impact of Health Reform on the Cost of Private Health Insurance Coverage,” PricewaterhouseCoopers, October 2009.
87 percent of the revenue in the original Baucus proposal to finance Obamacare would come from individuals with incomes of less than $200,000.
The U.S. Senate’s version of Obamacare finally is emerging into broad daylight, and the more people see of it, the less popular it should be.
For all the rhetoric, the plan is quite easy to sketch, thanks in part to an analysis by the congressional Joint Committee on Taxation.
So here goes: Under the health-care plan advanced by Senate Finance Committee Chairman Max Baucus, lower- and middle-class people who have insurance today are going to be taxed and squeezed in order to cover people who don’t.
The money to finance the new entitlement comes from two main sources, tax increases and Medicare cuts. Medicare cuts are mostly borne by elderly folks with modest means. That undoubtedly explains why seniors are so concerned.
The tax increases, by contrast, have received little attention. There has been almost no discussion of the simple question: who would pay the tab?
Think about how unusual that is. It is a radical departure from past tax debates. When President George W. Bush was in office, every tax proposal, no matter how minor, seemed to be buried by a blizzard of detailed distributional analyses that went from think-tank Web sites to the front pages of your favorite newspaper instantaneously.
In this debate, the distributional-industrial complex has remained silent.
Such remarkable silence in the noisiest town on earth can only be caused by an uncomfortable truth. And the mother of all uncomfortable truths is lurking below the surface in the health debate. If you are a card-carrying member of the left-wing establishment, you can’t analyze the distributional consequences of the health bill, because if you do, you will catch President Barack Obama in a lie.
The Senate Finance Committee holds its big health-care vote today, but the bigger story is that the health-care industry may finally be coming to its senses. After months of serving as Rose Garden props, insurers, doctors and hospitals are discovering they’ve been taken for a ride on ObamaCare. Too bad it may be too late to stop the train.
The best scales-from-the-eyes moment comes courtesy of America’s Health Insurance Plans, the industry lobby. Yesterday AHIP released an important PricewaterhouseCoopers study showing that the Finance bill would on average add some $1,700 a year to the cost of family coverage in 2013. A decade from now, family premiums would cost $4,000 more than if Congress did nothing, and singles would pay about $1,500 more. Hardest hit would be the individual market, with rates rising by 49%, but even the largest employers would see increases between 9% and 11%.
The study’s findings won’t shock anyone who’s read the bill’s details, but its provenance might: In a deal cut earlier this year, the insurance industry acquiesced to rules requiring them to take all comers, regardless of health status or history, and also charge them more or less the same premiums. In return, Congress would subsidize individuals to buy their products and provide new customers by requiring everyone to buy insurance or pay a tax penalty.
By Rep. Michele Bachmann — As unemployment surpasses 10 percent, Congress continues to vow that job creation is a top priority. After the $1.1 trillion stimulus failed to prevent unemployment from rising above 8 percent as its proponents promised, lawmakers are feeling the heat from American families as they struggle to pay for their mortgage, college tuition, and healthcare.
The House-approved healthcare overhaul would raise the costs of healthcare by $289 billion over the next 10 years, according to an analysis by the chief actuary at the Centers for Medicare and Medicaid Services (CMS).
As usual, the most dangerous parts of ObamaCare aren’t receiving the scrutiny they deserve—and one of the least examined is a new commission to tell Congress how to control health spending. Democrats are quietly attempting to impose a “global budget” on Medicare, with radical implications for U.S. medicine.
It’s too bad the health care overhaul that House Democrats narrowly approved last week isn’t a medical product. If it were, it would have to come with a warning label, Which could read something like this:
From 
Nancy Pelosi has unveiled the new health care bill in the House after merging together three different versions of legislation. To appease moderate Blue Dog Democrats and to meet President Obama’s oft-stated promise that reform wouldn’t cost more than $900 billion in the first ten years, Speaker Pelosi sought to reduce the $1.5 trillion total cost of the bill. Newsflash: she failed.
From the 
From the New York Times
Washington has just run a $1.4 trillion budget deficit for fiscal 2009, even as we are told a new health-care entitlement will reduce red ink by $81 billion over 10 years. To believe that fantastic claim, you have to ignore everything we know about Washington and the history of government health-care programs. For the record, we decided to take a look at how previous federal forecasts matched what later happened. It isn’t pretty.
By Douglas Holtz-Eakin — Remember when health-care reform was supposed to make life better for the middle class? That dream began to unravel this past summer when Congress proposed a bill that failed to include any competition-based reforms that would actually bend the curve of health-care costs. It fell apart completely when Democrats began papering over the gaping holes their plan would rip in the federal budget.
The Senate Finance Committee, chaired by Sen. Max Baucus (D-Mont.), claimed it posted the “full text” of its health care reform bill, “America’s Healthy Future Act,” on its Web site. But when users 
The Senate Finance Committee bill written by Chairman Max Baucus (D-Mont.) (the Baucus bill) will drive up the cost of health insurance for all Americans and then force everyone to buy it or face tax penalties or jail time. While the Baucus bill does cap out-of-pocket costs based on a person’s income, the effect on American families is still staggering, says PricewaterhouseCoopers. 
The U.S. Senate’s version of Obamacare finally is emerging into broad daylight, and the more people see of it, the less popular it should be.
The Senate Finance Committee holds its big health-care vote today, but the bigger story is that the health-care industry may finally be coming to its senses. After months of serving as Rose Garden props, insurers, doctors and hospitals are discovering they’ve been taken for a ride on ObamaCare. Too bad it may be too late to stop the train.
Entries (RSS)