Obama concedes: Obamacare didn’t do anything for rising health care costs
posted at 12:31 pm on January 22, 2013 by Mary Katharine Ham
It started out with such high hopes:
“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.”
That was on the trail in 2008, an audacious promise Politifact ruled flatly “Broken.” Obama repeated the promises of lower premiums and bent cost curves as a central part of his pitch in passing the health care law. It is called “The Affordable Care Act.” But most supporters of Obamacare have stopped talking about cost savings and started focusing on increased benefits, acknowledging (sometimes explicitly and sometimes implicitly) that expanded coverage and more benefits will actually cost more money, not less, but that the trade-off is worth it.
President Obama joined that crowd in his second Inaugural address Monday. It came as Obama just barely grazed two issues rather important to the American people at the end of this paragraph:
We understand that outworn programs are inadequate to the needs of our time. So we must harness new ideas and technology to remake our government, revamp our tax code, reform our schools, and empower our citizens with the skills they need to work hard or learn more, reach higher. But while the means will change, our purpose endures. A nation that rewards the effort and determination of every single American, that is what this moment requires. That is what will give real meaning to our creed. We, the people, still believe that every citizen deserves a basic measure of security and dignity. We must make the hard choices to reduce the cost of health care and the size of our deficit.
And, now for the “but,” clause, which includes all the reasons he can’t actually ever make hard choices:
But we reject the belief that America must choose between caring for the generation that built this country and investing in the generation that will build its future.
President Obama spent two years of his first term passing a giant health care bill that was supposed to address rising costs. This claim was front and center in his appeal to a joint session of Congress on the matter in 2009:
Then there’s the problem of rising costs. We spend one-and-a-half times more per person on health care than any other country, but we aren’t any healthier for it. This is one of the reasons that insurance premiums have gone up three times faster than wages. It’s why so many employers – especially small businesses – are forcing their employees to pay more for insurance, or are dropping their coverage entirely. It’s why so many aspiring entrepreneurs cannot afford to open a business in the first place, and why American businesses that compete internationally – like our automakers – are at a huge disadvantage. And it’s why those of us with health insurance are also paying a hidden and growing tax for those without it – about $1000 per year that pays for somebody else’s emergency room and charitable care.
Finally, our health care system is placing an unsustainable burden on taxpayers. When health care costs grow at the rate they have, it puts greater pressure on programs like Medicare and Medicaid. If we do nothing to slow these skyrocketing costs, we will eventually be spending more on Medicare and Medicaid than every other government program combined. Put simply, our health care problem is our deficit problem. Nothing else even comes close.
These are the facts. Nobody disputes them. We know we must reform this system.
And, so we did, allegedly with an eye toward “bending the cost curve down” and lowering premiums for families. It has been more than two years since the law passed. Critics of the law have been proven right again and again in their skepticism that it could do those things.
President Obama’s health care overhaul law will increase the nation’s health care tab instead of bringing costs down, government economic forecasters concluded Thursday in a sobering assessment of the sweeping legislation.
A report by economic experts at the Health and Human Services Department said the health care remake will achieve Obama’s aim of expanding health insurance — adding 34 million Americans to the coverage rolls.
But the analysis also found that the law falls short of the president’s twin goal of controlling runaway costs. It also warned that Medicare cuts may be unrealistic and unsustainable, driving about 15% of hospitals into the red and “possibly jeopardizing access” to care for seniors.
The mixed verdict for Obama’s signature issue is the first comprehensive look by neutral experts.
The Kaiser Family Foundation shows family premiums topped $15,000 a year for the first time in 2011, increasing a whopping 9% this year, three times more than the increase the year before. The study says that up to 2% of that increase is because of the health care law’s provisions, such as allowing families to add grown children up to 26 years old to their policies.
How did a program so obviously unsustainable that the White House had no choice but to shut it down produce an $80 billion surplus for ObamaCare accounting purposes? Very simply, actually. The Democrats designed the first five years of CLASS to be a “vesting period” in which enrollees would pay into the program but receive no benefits yet. In other words, for the first five years, the program would have been pure profit for the government — and then, when benefits finally kicked in, the hemorrhaging would begin. The reason they did it that way is the same reason they delayed the start of ObamaCare until 2014: They knew that CBO “scores” new legislation based on its first 10 years of operation, so the more they could game the numbers during those first 10 years, the better the “score” for ObamaCare would look while Democrats were trying to sell it to the public. It was a massive accounting fraud designed to make health-care reform seem much less expensive than it really was. According to Klein, CLASS’s phony “savings” accounted for fully $70 billion of ObamaCare’s supposed $143 billion in deficit reduction.
The very first part of ObamaCare to get the knife was the 1099 reporting requirement. That extremist bit of legislation passed the Senate 87-12 and the House, 314-112, and landed on the President’s desk for signing on April 14. The 1099 reporting requirement was one of the funding fictions ObamaCare supporters used to make it look as if the President’s plan would fulfill his promise not to “add a dime to the deficit.” Post-passage it was almost universally recognized as unworkable. It would have required businesses to fill out an IRS form (1099) for every $600 of staples and printer paper they bought at Target within a calendar year. It closed a loophole, and that loophole was shopping.
When it was repealed, Obama called it “a big win for small business.”
When President Obama began pushing national health care legislation in 2009, he argued that reform was needed to rein in the unsustainable growth in health care spending that was crippling the budgets of businesses, states and the federal government. But a new government actuarial study finds that as a result of the law, health care spending will be $478 billion higher over the next decade than it would have otherwise been had no law been passed.
Furthermore, as a result of the health care law, about 50 cents of every dollar of health care spending in the United States will be financed by government by 2021, according to the report from the actuary’s office at the Centers for Medicare and Medicaid Services, unveiled today in the journal Health Affairs.
Then there’s the $63 Obamacare’s newly written regulations added to everyone’s premium in December, which even if it were the only increase for which Obamacare was responsible, would still put Obama $2,563 off his promise.
The charge, buried in a recent regulation, works out to tens of millions of dollars for the largest companies, employers say. Most of that is likely to be passed on to workers.
The report predicted that widespread use of electronic records could save the United States health care system at least $81 billion a year, a figure RAND now says was overstated. The study was widely praised within the technology industry and helped persuade Congress and the Obama administration to authorize billions of dollars in federal stimulus money in 2009 to help hospitals and doctors pay for the installation of electronic records systems.
“RAND got a lot of attention and a lot of buzz with the original analysis,” said Dr. Kellermann, who was not involved in the 2005 study. “The industry quickly embraced it.”
But evidence of significant savings is scant, and there is increasing concern that electronic records have actually added to costs by making it easier to bill more for some services.
If you work for a small business, your next health insurance premium may give you sticker shock.
Many of the small-business and individual insurance policies are working the health reform law’s 2014 fees into their 2013 bills, contributing to double-digit premium increases for some people.
All those new consumer benefits packed into the health reform law — birth control without a co-pay, free preventive care and limits on when insurers can turn down a customer — had to be paid for somehow.
So the law’s drafters included a new tax on health insurers, starting at $8 billion in 2014 and increasing to $14 billion within four years, to help meet the new expenses. And insurers in 2014 will also have to pay a “reinsurance contribution” to cushion health plans that end up with a lot of sick customers under new rules requiring them to cover people with pre-existing conditions.
The Government Accountability Office (GAO)’s annual audit of the government, released Thursday, raises serious concerns about the federal government’s long-term financial stability and the effectiveness of the Affordable Care Act’s cost-curbing measures.
The report found “that—absent policy changes—the federal government continues to face an unsustainable fiscal path.”
Obamacare has already failed in its promises. Our president spent two years, during the worst economic downturn since the Depression, passing a law more than 50 percent of the public still hates because 85 percent of them were satisfied with their current coverage, imperfect though it was. He turned the crayon box upside down to draw a picture no one wanted and we all must now pay more money to enjoy his vision. The only spending problem he’ll concede we have has been exacerbated by his own signature “achievement.”
These are the facts. Nobody disputes them. Not even Obama.