Health spending in the U.S. grew to $3.2 trillion in 2015, fueled partly by the expansion of health insurance to millions of people under the Affordable Care Act, according to a new estimate published in the journal Health Affairs.
The study also looks forward, projecting that through the next decade, national health spending will climb at 5.8 percent per year, on average, to encompass a fifth of the economy by 2025.
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The Republican assertion that the administration is spending on health insurance subsidies without required congressional authority hasn’t gotten much news coverage. Many people dismiss it as yet another time-wasting attempt by Republicans to undermine the president’s signature domestic policy achievement.
But the central issue goes beyond health care to the fundamental division of federal power, particularly in a time of deep fissures between the legislative and executive branches.
Congress is supposed to approve every penny of federal spending. But the institution is in such partisan disarray that the appropriations process barely functions, giving rise to the temptation for presidents to assert greater power over the purse, marginalizing Congress.
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House Republicans on Wednesday released their healthcare spending bill for fiscal 2017, boosting funding to fight opioid abuse and the Zika virus while taking aim at ObamaCare and abortion.
Today, after years of hearings and speeches and debates, the Paul Ryan-led House of Representatives has done something it has not done before: it has released a comprehensive, 37-page proposal to reform nearly every federal health care program, including Medicare, Medicaid, and Obamacare. No proposal is perfect—and we’ll get to the Ryan plan’s imperfections—but, all in all, we would have a far better health care system with the Ryan plan than we do today.
The first thing to know about the Ryan-led plan — part of a group of proposals called “A Better Way” — is that it’s not a bill written in legislative language. Nor is it a plan that has been endorsed by every House Republican.
Instead, it’s a 37-page white paper which describes, in a fair amount of detail, a kind of “conversation starter” that House GOP leadership hopes to have with its rank-and-file members, and with the public, in order to consolidate support around a more market-based approach to health reform.
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House Speaker Paul Ryan’s policy plan for health care, as expected, leans heavily on market forces, more so than the current system created by Obamacare. The proposal contains a host of previously proposed Republican ideas on health care, many of which are designed to drive people to private insurance markets.
Importantly for conservatives, as part of a full repeal of the Affordable Care Act, the current law’s mandates for individuals and insurers would disappear under the GOP plan. It would overhaul Medicare by transitioning to a premium support system under which beneficiaries would receive a set amount to pay for coverage. The plan also would alter Medicaid by implementing either per capita caps or block grants, based on a state’s preference.
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The looming collapse of the Obamacare exchanges is prompting calls for even more government involvement in healthcare — even a single-payer system.
It takes a special kind of reasoning to respond to the spectacular failure of government that is Obamacare by calling for, well, even more government.
Obamacare is faltering. No matter who wins in November, the next president will face a genuine crisis of the current president’s making.
And it defies logic to attempt to correct this entirely predictable failure of government with “fixes” that give the federal government even more control over Americans’ healthcare.
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The Committee for a Responsible Federal Budget (CRFB) says the proposals of Democratic presidential candidate Bernie Sanders would add $19 trillion to the debt — an increase from its previous estimate.
In an analysis published in April, the CRFB estimated that the Independent senator’s proposals would add $2 trillion to $15 trillion to the debt, depending on the cost of Sanders’s single-payer healthcare plan. Since then, two new independent analyses have found that the healthcare plan “would cost dramatically more than the campaign-provided estimates suggest,” the CRFB said Thursday in its updated analysis.
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Sound fiscal policy is essential for sound governance. History shows that powerful nations that engage in reckless spending and borrowing eventually fall into periods of decline. It would be disastrous if the United States were to drift into such a slide.
What’s needed are fundamental reforms that will change the direction of key programs in ways that will last for decades. This kind of project will take many years to achieve, and some very important policy changes are likely to require lengthy transition provisions to reassure voters who are accustomed to current arrangements. But the current welfare state wasn’t built in a day, and changing its orientation is going to require persistence and patience.
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Here’s some bad news for the insurance industry: Unexpectedly generous corporate subsidies didn’t save companies selling ObamaCare policies from bleeding red ink. The worse news: Those subsidies are set to expire in 2017, meaning that insurers will have to make ends meet without billions in handouts.
Those are among the matters discussed in a study by the Mercatus Center, authored by Brian Blase, Edmund Haislmaier, and Doug Badger. Thestudy, based on detailed data derived from insurer regulatory filings for the 2014 benefit year, finds that companies that sold ObamaCare plans in the individual market lost more than $2.2 billion, despite receiving $6.7 billion (an average of $833 per enrollee) in “reinsurance” subsidies. Those reinsurance payments were 40 percent more generous on a per-enrollee basis than insurers had expected when they set their 2014 premiums.
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Even before President Obama leaves office, ObamaCare has begun unraveling.
The law was passed over the objections of a majority of Americans, it is still opposed by a majority of Americans — and their opposition has been vindicated. Last week, UnitedHealth Group announced that, after estimated losses of more than $1 billion for 2015 and 2016 under ObamaCare, the company was pulling out of most of its ill-fated exchanges. In fact, commercial insurers across the country are hemorrhaging money on ObamaCare at alarming rates.
The president promised these insurers taxpayer bailouts if they lost money, but Congress in its wisdom passed legislation barring the use of taxpayer dollars to prop up the insurers. Without the bailouts, commercial insurers are being forced to eat their losses — while more than half of the ObamaCare nonprofit insurance cooperatives created under the law failed.
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