“So the facts are in. Obamacare includes tremendous new levels of federal spending at a time when lawmakers are seeking ways to reduce the unaffordable size of government. It pays for new spending by increasing taxes on the American people, burdening individuals and businesses and putting further strain on the economy. And, as we explain further in recent research, a realistic scoring of Obamacare shows that it is certain to increase deficits.”
“Few have been discussing the fact that last year’s health care law will increase gross federal debt and thus accelerate the speed at which we will approach the statutory debt limit in the future. As elected officials wrestle with these two contentious issues (health care and the debt limit) it seems reasonable to set a minimum policy goal that last year’s health care law be modified so that it at least not worsen the statutory debt outlook.”
“What made people especially angry was that I argued that ObamaCare had made our fiscal problems worse–yes, even if its deficit-reduction measures all worked, a proposition of which I am deeply skeptical. That’s because ObamaCare used up all the most obvious and politically feasible cuts in Medicare–and when that proved insufficient, some that weren’t obvious or politically feasible, like requiring every small business owner in the land to issue 1099s to people they bought supplies from.”
“To consider what the expansion of Medicaid under ObamaCare might do to the states, take a look at Massachusetts and Tennessee. In 2006, Massachusetts overhauled its entire health-care system, including a significant expansion of Medicaid. This expansion is costing the state far more than expected. Gov. Deval Patrick approved a record-setting $9.6 billion to cover its share of Medicaid costs last July. It wasn’t enough. He’s already gone back to the legislature twice, adding almost $600 million in additional funds.”
“The Obama Administration’s healthcare proposals continue to rob Peter to pay Paul with dangerous
consequences for the America’s healthcare system. First, the President failed to address the Medicare
physician reimbursement problem with the Patient Protection and Affordable Care Act. Now the
President is proposing a two year doc fix that shifts care access problems from the elderly to the poor,
undermines drug innovation, and further relies on unproven cost savings that will likely just add to the
federal budget deficit.”
“Sebelius began her remarks by stating that taxpayer funds will not be used to bail out CLASS in the event of insolvency. But a taxpayer bailout is a real possibility for several reasons. First, premiums may be set lower than the actuarially correct amount. This is because there isn’t a useful model for actuaries to determine premiums, especially given the uncertainties of enrollee make-up. Second, within the law’s provisions, if benefits paid out are larger than anticipated, then either premiums will have to increase or benefits will have to be cut. This is a move that would be vigorously opposed by interested parties. Beneficiaries with a vested interest in preserving their CLASS payment will likely lobby vigorously to spread the pain through broad-based tax increases.”
“For example, under reconciliation the Senate Budget Committee could instruct the Senate Finance Committee to reduce mandatory spending on insurance subsidies and Medicaid expansion. These two items make up more than 90% of spending in ObamaCare. All the changes from all the committees are then bundled into one measure and voted upon. Because reconciliation is protected by the rules of the budget process, it doesn’t take 60 votes to bring it up and it requires only a simple majority to pass.”
“I will discuss why the Affordable Care Act is much more likely to increase the deficit than
reduce it; explain how the mandates, taxes, and penalties that it imposes on insurers and employers will
increase health care costs and decrease employment; and conclude by exploring the negative effects of
regulatory uncertainty at a time when companies are ‘sitting’ on trillions of dollars in cash that could
be used for job creation.”
“The measure repealing the 1099 mandate may itself increase the deficit slightly. It will reduce federal tax collections by $17 billion, and the offsetting spending cuts are highly questionable. This vote’s real significance, however, is that it shows why ObamaCare’s entitlement spending would survive the political process while its revenue-raising provisions would not.”
“The United States faces severe economic consequences if skyrocketing federal spending on health care is not addressed. Rather than acknowledge this, Obamacare left in place an unsustainable policy that adds billions to the deficit each year. It creates the illusion of fiscal responsibility through its unsustainable cuts to Medicare and sets up yet another entitlement program to further burden taxpayers. The CBO’s report is a reminder of the ailing fiscal health of the country, which is made worse by Obamacare.”