Health Care Reform

States Can Still Do Something About ObamaCare

50 Vetoes: How States Can Stop the Obama Health Care Law

The 2012 election dealt a blow to the country, not just because it guaranteed the same failed economic policies of the last four years, but because it also means that any push to repeal ObamaCare in Congress is a non-starter. Despite that, there will still be ways to significantly diminish the impact of the law.

While the decision last year to uphold the individual mandate was certainly disappointing, the Supreme Court did provide lattitude for states to refuse to implement expensive insurance exchanges and even more costly Medicare expansion. This was a silver-lining in an otherwise terrible decision that set a very troubling precendent for future expansions of government.

In a new whitepaper, “50 Vetoes: How States Can Stop the Obama Health Care Law,” Michael Cannon, director of Health Policy Studies at the Cato Institute, explains that this gives states the chance to effectively veto these provisions and thus save taxpayers and business money.

“To date, 34 states, accounting for roughly two-thirds of the U.S. population, have refused to create Exchanges,” writes Cannon in the summary of the whitepaper. “Under the statute, this shields employers in those states from a $2,000 per worker tax that will apply in states that are creating Exchanges (e.g., California, Colorado, New York).”

“Those 34 states have exempted at least 8 million residents from taxes as high as $2,085 on families of four earning as little as $24,000,” he continues. “They have also reduced federal deficits by hundreds of billions of dollars.”

Florida House Committee, Speaker Reject ObamaCare’s Medicaid Expansion

On Monday, a select committee of the Florida House of Representatives rejected ObamaCare’s Medicaid expansion. Shortly thereafter, the speaker of the Florida House announced his opposition:

I am proud of the thoughtful, thorough and deliberative approach that our Select Committee took on the important issues related to Medicaid expansion and health exchanges. I received their recommendations and agree that expanding Medicaid and setting up a state exchange is not in the best interest of our state. We simply cannot count on the federal government to pay 100 percent of the cost for expansion. The facts show that healthcare costs will go up for many Floridians, while access to and quality of healthcare will go down. The ‘all or nothing’ approach that the Obama administration is offering will not work for our state. I know there will be continued discussion about this matter, and I look forward to exploring better policies for our state.

It looks like Medicaid expansion in Florida may not be the foregone conclusion that some people thought.

ObamaCare is a bad deal for young Americans

youth vote

There is no question that the youth vote was key to President Barack Obama’s re-election in 2012. However, there was a time when this voting bloc went for Republican presidential candidates. Just after the election, Jason Riley noted at the Wall Street Journal that both Ronald Reagan and George H.W. Bush actually won the youth vote. Riley also points out that “George W. Bush lost young voters to John Kerry by only 9 points and lost them to Al Gore in 2000 by less than that.”

But according to CNN’s exit poll, 60% of voters between the ages of 18 to 29 cast their ballot for Obama, highlighting that the problems that young voters have with Republicans.

Taking out the fact the White House has mortgaged the future of young Americans thanks to the deficits and debt he’s racked up over the last four years, Obama is really about to hurt one of his base groups, as noted Ben Smith earlier this week:

State and federal officials and the health-care industry are currently preparing to implement two specific ObamaCare provisions taking effect on Jan. 1, 2014, acting on this politically perverse principle of shifting resources from your supporters to your opponents. The first is the individual mandate, which aims to force the young, childless, and healthy — “Young Invincibles,” as they are said to think of themselves — to buy health insurance, even if they think (and even perhaps make a rational, if risky, bet) that they don’t need it.

Cost of ObamaCare exchanges jumps by 29%

Congrats, ObamaCare, you had the worst week in Washington. It’s no secret that President Barack Obama’s signature domestic policy achievement has come at a high cost to taxpayers. Earlier this week, the Congressional Budget Office (CBO) noted that the estimated cost tag for ObamaCare was $1.165 trillion over the next 10 years, more than the original estimate of $945 billion.

What is one of the driving factors of the increased costs? John Berline dove further into the CBO’s recent report and found that the costs of the insurance exchanges have jumped significantly since the law was passed:

The CBO’s new baseline estimate shows that ObamaCare subsidies offered through the insurance exchanges — which are supposed to be up and running by next January — will total more than $1 trillion through 2022, up from $814 billion over those same years in its budget forecast made a year ago. That’s an increase of nearly 29%.

The CBO upped the 10-year subsidy cost by $32 billion since just last August.

Bipartisan push to repeal ObamaCare’s job-killing medical device tax

“[W]e have to pass the bill so that you can find out what is in it, away from the fog of the controversy,” claimed then-Speaker Nancy Pelosi just before Congress passed ObamaCare. Since that time Americans have come to realize that what’s in the bill is causing their premiums to skyrocket and putting their current coverage at risk.

Congress has also had to repeal different parts of ObamaCare. In 2011, Congress repealed the 1099 reporting requirement, which would have bogged down small businesses with paperwork. More recently, Congress was able to push through repeal of the costly CLASS Act as part of the “fiscal cliff deal.”

Another part of the law, the medical device tax, is now being targeted for repeal. Back in December, a group of 18 Democrats urged Senate Majority Leader to support a delay in the implementation of the tax, which could lead to the loss of 43,000 jobs.

IRS: ObamaCare plans to cost families at least $20,000 per year

During the debate over his health care reform proposal, President Barack Obama and his apologists in Congress insisted that it would hold down insurance premiums for American families. But despite these promises, Jonathan Gruber, the architect of the plan, acknowledged that insurance premiums would still rise under ObamaCare.

So it comes as no surprise to see read an IRS report released last week showing that the cheapest health insurance plan under ObamaCare will cost a family $20,000 in 2016:

In a final regulation issued Wednesday, the Internal Revenue Service (IRS) assumed that under Obamacare the cheapest health insurance plan available in 2016 for a family will cost $20,000 for the year.
The IRS’s assumption that the cheapest plan for a family will cost $20,000 per year is found in examples the IRS gives to help people understand how to calculate the penalty they will need to pay the government if they do not buy a mandated health plan.

The examples point to families of four and families of five, both of which the IRS expects in its assumptions to pay a minimum of $20,000 per year for a bronze plan.

“The annual national average bronze plan premium for a family of 5 (2 adults, 3 children) is $20,000,” the regulation says.

While the individual mandate is supposed to ensure that Americans purchase health insurance coverage, a nearly $1,700 per month premium is going to be too much for many families to afford. CNS News notes that the failure to purchase health insurance coverage would result in a $2,085 penalty per family (or 2.5% of taxable income) in 2016.

Supreme Court Snubs Citizens Whose Social Security Will Be Confiscated If They Refuse Government Health Care

Written by Ilya Shapiro, a senior fellow in constitutional studies at the Cato Institute. Posted with permission from Cato @ Liberty.

Some of the U.S. Supreme Court’s most significant decisions are those declining to hear a case. Two weeks ago, the Court made such a momentous non-ruling in refusing to hear a lawsuit, Hall v. Sebelius, challenging government policies that deny otherwise eligible retirees their Social Security benefits if they choose not to enroll in Medicare. (I previously wrote about the case, and Cato filed a brief supporting the retirees’ petition for Supreme Court review.)

Despite having paid thousands of dollars each in Social Security and Medicare taxes during their working lives—for which they never sought reimbursement—the five plaintiffs were told by officials at the Social Security Administration and Department of Health and Human Services that they had to forfeit all of their Social Security benefits if they wished to withdraw from (or not enroll in) Medicare. This determination resulted from internal policies that were put in place during the Clinton administration and strengthened by the Bush administration. The plaintiffs sought a judicial ruling that would prohibit SSA and HHS from enforcing these policies, which they believed conflicted with the Social Security and Medicare statutes. A sharply divided U.S Court of Appeals for the D.C. Circuit eventually upheld them. By its decision not to hear the case, the Supreme Court let that controversial ruling stand.

Insurance premiums set to rise again

You mad, bro?

Part of the reasoning for passage of ObamaCare was that it would lower health insurance premiums. During his 2008 campaign, Obama very specifically said, “I will sign a universal health care bill into law by the end of my first term as president that will cover every American and cut the cost of a typical family’s premium by up to $2,500 a year.”

If it sounds too good to be true; than it probably is. In September, the Kaiser Family Foundation issued a report noting that health insurance premiums had risen by more than $2,300 since 2009.

This isn’t exaclty a shock. Richard Foster, Chief Actuary of the Centers for Medicare and Medicaid Services, explained during a 2011 congressional hearing that ObamaCare was unlikely to hold down health care costs. More recently, Jonathan Gruber, the architect of ObamaCare, admitted that the law wouldn’t keep health insurance premiums down.

Here we are at the beginning of 2013 and we’re seeing that health insurance premiums are set to rise — by more than 20% in some cases — yet again:

Health insurance companies across the country are seeking and winning double-digit increases in premiums for some customers, even though one of the biggest objectives of the Obama administration’s health care law was to stem the rapid rise in insurance costs for consumers.

Particularly vulnerable to the high rates are small businesses and people who do not have employer-provided insurance and must buy it on their own.

Why ‘Obamacare’s Critics Refuse to Give Up’

Written by Michael F. Cannon, Director of Health Policy Studies at the Cato Institute. Posted with permission from Cato @ Liberty.

Jonathan Adler and I have a paper titled, “Taxation Without Representation: The Illegal IRS Rule to Expand Tax Credits Under the PPACA.” Our central claims are:

  1. The Patient Protection and Affordable Care Act explicitly restricts its “premium-assistance tax credits” (and thus the “cost-sharing subsidies” and employer- and individual-mandate penalties those tax credits trigger) to health insurance “exchanges” established by states;
  2. The IRS has no authority to offer those entitlements or impose those taxes in states that opt not to create Exchanges; and
  3. The IRS’s ongoing attempt to impose those taxes and issue those entitlements through Exchanges established by the federal government is contrary to congressional intent and the clear language of the Act.

Over at The New Republic’s blog The Plank, my friend Jonathan Cohn says this is “preposterous“:

No sentient being following the health care debate could argue, in good faith, that Obamacare’s architects intended for the federal government to set up exchanges without subsidies. It would completely subvert the law’s intent.

It appears my friend does not know the statute, the legislative history, or what Congress’ intent was.

It’s Papa John’s Appreciation Day

Papa John's

Back in August, John Schnatter, founder and CEO of Papa John’s, noted that his company would have to raise prices in order to cover the cost of ObamaCare and have to scale back hours for workers. This is pretty basic economics. When a expenses rise, either for the cost of raw materials or employing workers, a business will be forced to pass the buck on the consumer or reduce costs elsewhere.

Papa John’s isn’t alone. Last month, Darden Restaurants, which owns Olive Garden, Longhorn, and Red Lobster, announced that it would move hourly workers to part-time schedules because of mandates in ObamaCare requiring businesses to offer health insurance coverage to employees working over 30 hours a week. A Florida-based restaurant owner has said that he’ll add a 5% surcharge to customers to makeup the cost of the mandates from ObamaCare.

Schnatter’s comment, while entirely understandable from a business perspective, stirred controversy on the Left, as activists called for a boycott of Papa John’s. This has caused opponents of ObamaCare to organize “National Papa John’s Appreciation Day” which is being organized by Reboot USA.

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