Introduction
The Patient Protection and Affordable Care Act of 2009, also known in popular parlance as “Obamacare,” has become one of the most controversial topics in American politics. On one side of the argument are those who believe that health insurance is a fundamental right for all, regardless of their ability to pay for it; in order to keep the costs of health care going into the future lower, this means that everyone is required to carry insurance. Those who are healthy, or who cannot afford it, and therefore decide that they do not want medical insurance, would face a penalty. If the healthy were allowed to opt out, then the costs for those who remain in the system would be higher. If the poor either opt out or simply do not purchase it because of a lack of available funds, but then need medical care, they will often simply head to emergency rooms that cannot turn them away – thus driving up the cost of their own care as well. People without medical insurance will often avoid preventive care visits, which could end up saving them quite a bit of money over time – not to mention their lives. On the other side of the argument are those who claim that individuals should have the right to choose whether or not to carry insurance for themselves, and that it is not the duty of one group of society to subsidize the costs of other groups in society. The legislation as it stands is comprised of ten separate titles that, taken in total, lay out the program to be operated by the Department of Health and Human Services (HHS). These elements of the program include ensuring that all Americans receive quality healthcare, specifying and improving the results attained through Medicare, preventing disease and improving general health, providing financial aid to medical schools, growing the pharmaceutical market, and strengthening previous health care reforms. However, as positive as the goals sound, there are some troubling facts about the program that could, over time, cause significant problems. Even as the law is going into full effect between now and 2014, there are growing concerns that the bill will damage America in the long term.
Things that I Know: Taxes and Costs Rising
One of the facts about this legislation that have been publicized widely by both sides in the debate is that the law will provide health insurance for 30 million Americans who currently have no coverage. Many of these 30 million will receive their coverage through the expansion of Medicaid eligibility – in fact, estimates place this number as high as 66 percent of the new 30 million beneficiaries (Bigelow, 2012). Adding these new clients will send costs rising for health insurance providers; at the same time, the government will cut back on its health subsidies, in an attempt to cut the deficit. The cost of average health care could increase by as much as $3,000 as of 2012; two-thirds of that increase took place in the time since the first phases of Obamacare went into effect in 2010. For the average family, costs could increase by as much as $12,000 by the start of 2015 (Clancy, 2012). This may represent health care reform, but it does not appear to deliver the savings that President Obama had promised. The only thing that appears to be “progressive” about this legislation is the growth in costs.
Another burdensome element of this growth in coverage by 30 million Americans is that the need for health care will take off, but the number of available hospitals and doctors for patients to use will not go up. This could create a bottleneck of availability and could, at least in the short term, create a shortage of practitioners should people need health care. According to Kartch (2012), the new taxes that this legislation is generating could get as high as $514 billion, including the income from workplace taxes and medical device taxes, both of which will hurt the growth of insurers and reduce incentive for companies to produce medical innovations and for college graduates to see medical school as the start to an attractive career path. Because there are many Americans who do not pay any income taxes, the portions of Obamacare that are tied to the income tax system are taken disproportionately from the taxpaying part of the population, which is composed primarily of young people in the working class. The equation is to cut federal aid, let anyone have health care, boost taxes, and let the private health care companies deal with the cost. If history is any predictor, it is fairly safe to say that we know where those costs will end up – in the lap of the consumer. The fact that the government cannot effectively manage medical costs will be left for the taxpayer to deal with.
In the current medical health care system, different individuals have different premium levels, for a variety of reasons, ranging from age to weight to whether or not they smoke, and beyond. Obamacare does not go so far as to give each insured client the same cost; instead, it uses the idea of the “community rating” to determine the proper premium cost for each person. The logic behind the “community rating” is that, because young people tend to be healthier than their older counterparts, they are not as likely to need services, meaning that it costs much less to insure young people than it does to insure older people. The markets have shown that a 65-year-old costs six times as much to cover as an 18-year-old. However, the 65-year-old’s premium would only be three times as much as the 18-year-old’s in the “community rating” system set up by Obamacare. The rest of the cost of caring for that 65-year-old will come from the younger taxpayers.
Things I Know: Lack of Congressional Support
Depending on the poll, there are many as 56 percent of the American populace that do not support Obamacare and would favor its repeal. As a result, the Republican Party has been staunch in its stance favoring a repeal of the legislation. When the legislation came up for a vote, 59 percent of Democrats voted for it; 14 percent of Republicans voted for it; and 36 percent of independents voted for it (Langer, 2012). It is clear that, by and large, the American electorate does not favor this path toward universal health care for all.
It is not just a simple disregard for President Obama which is fueling this discontent with Obamacare, though. Currently, small employers with fewer than ten employees have a hard time buying health coverage for their workers (Cohen, 2010). Even under the new provisions of Obamacare, the administrative costs will still go up, leading to an increased overall cost that ranges between 10 and 18 percent (Cohen, 2010). Employers who fail to provide coverage would have to pay penalties that would vary, based on the employee’s own economic status. The employer would face a penalty of 1 percent of the employee’s monthly income – or $95 (whichever is higher). The penalty for families that do not have coverage would be $285 or 1 percent of the family’s income. As time goes by, those individuals and family penalties will continue to rise, as the government wants to urge more and more people to join in the health care collective. It may be, overall, cheaper for employers to let people go than to pay the penalties for failing to comply with the law. Major companies, such as Papa John’s, are starting to complain about the higher costs of medical insurance, talking about having to pass costs on to the consumer. Whether the business is large or small, though, there are several reasons why employers are having such difficulty figuring out the ins and outs of Obamacare. One of these is the simple fact that the law is still changing. Different provisions are wandering in and out of different levels of the court system; the Supreme Court opened up a new line of challenge to Obamacare by ordering a federal appeals court to consider the claim brought by Liberty University that the care mandate violates the institution’s religious freedoms (Sherman). As a result, it is extremely difficult for employers to plan, as they do not necessarily know which of the provisions will be mandatory, which will be modified, or which will just be struck down. Second is the confusion that many employers, particularly small business owners, have concerning the specific provisions of the law. The process of writing regulations for laws comes after the passage and can frequently take months at a time.
Risks for the System
In addition to the financial issues that Obamacare will create, the quality of future health care is also in danger. There will be a series of panels who are authorized to make decisions about the specific services that providers may give to beneficiaries. While it is true that private health care companies also limit the services available to beneficiaries, there are not many instances in American history where the government has been able to improve on the performance of the private sector. Ultimately, the fact that the government will hold the money will require patients to accept limited amounts of care. Not only will doctor’s offices and hospitals have to follow the standards that the Department of Health and Human Services sets, but providers will not receive payment for any unauthorized services that they provide. If Obamacare says that the service is permissible, then it will be covered; otherwise, the patient will have to go without. If patients feel they need an uncovered service, then they will have to bear the entire out-of-pocket cost (National Right to Life Committee, 2011). The end result is a health care system that is managed by the government. You’ve seen how the government handled Hurricane Katrina, right? Or the BP oil spill? It’s not as though the federal government needs to be in charge of very much outside national defense. Health care is not the next project the government should take on.
Works Cited
Bigelow, W. “Obama HHS Admits Medicare Costs Skyrocket Under Obamacare.” Breitbart.
Clancy, D.” Top Ten Reasons to Repeal ObamaCare.” Freedom Works Foundation.
Cohen, A. “ Federal Health Reform: Impact on Small- and Medium-Sized Employers.” Insure the Uninsured Project.
Kartch, J. “Full List of Obamacare Tax Hikes: Listed in order of effective date.” Americans for Tax Reform.
National Right to Life Committee. “How the Obama Health Care Plan Will Ration Your Family’s Medical Treatment - A Factsheet.” Life at Risk.
Sherman, Mark. “Court Orders Look at Health Care Challenge.” Boston Globe 27 November 2012. http://bostonglobe.com/news/nation/2012/11/27/court-orders-new-look-health-care-challenge/8nHy5ipdPAxJb1wEJwEQ4J/story.html
