The Elephant in the Room: Health reform fog is lifting

As its real costs become clearer, Obama's program is looking even more expensive for employers, seniors, and taxpayers.

Posted: June 16, 2010

Referring to President Obama's health-care program before it was enacted, House Speaker Nancy Pelosi said, "We have to pass the bill so that you can find out what is in it, away from the fog of controversy."

As we find out what is in it and how it affects all of our lives, it's obvious just who was pumping in the fog and why.

Obama's most insistent claim over the course of the debate was that everyone would be able to keep his or her own health insurance. But critics insisted there was no way that was going to happen. They said that by 2014, employers would be forced either to drop their health-insurance plans and pay a fine, or to change their plans to meet the government-knows-best mandatory standard of coverage.

Why are employers making changes to their health plans every year? Because costs have been shooting up faster than inflation and profits. Democrats promised that would change, but a month after passage of Obamacare, a report issued by the president's chief actuary at the Centers for Medicare and Medicaid Services said that overall health-care costs would actually go up under the new program. So much for the Democrats' promise.

That report came after several major companies, including Caterpillar and Verizon, informed their shareholders that they were anticipating billions of dollars in additional health-care costs as a result of Obamacare. Last month, in a Towers Watson survey of 661 companies, 94 percent expected Obamacare to increase their costs. Eighty-eight percent intended to pass on these higher costs to their employees, while 74 percent planned to reduce workers' health-care benefits.

It seems that significant changes in Americans' health-care plans are on the way. And they're not changes for the better.

Last week, however, both Health and Human Services Secretary Kathleen Sebelius and the president reiterated their promise that employees would be able to keep their current plans. The audacity of rhetoric!

Their dogged insistence on perpetrating this patent falsehood is even more stunning given an Obama administration report leaked last week. The joint study by three departments predicts that 40 to 69 percent of private employers, and up to 80 percent of those that are small businesses, will be forced to drop or change their - your - health plans. That's change you truly can believe in, sad to say.

But employees who are forced out of private plans aren't the only ones who will lose out. As a result of a $136 billion cut in the privately run alternative to government-run Medicare, Medicare Advantage, the Congressional Budget Office and Medicare actuaries recently reported that the program would be limited to current enrollees, and that enrollment would decrease by as much as a third. That leaves another promise broken.

Then there is the cost of the bill to taxpayers. In a shocking display of hubris, Democrats contended that this $900 billion new entitlement, covering 32 million additional Americans and creating numerous new bureaucracies, would reduce - yes, reduce - the deficit by more than $100 billion over the next decade.

Late last month, however, enough of Pelosi's fog lifted for the CBO to take a clearer look at new spending under the bill. The office now estimates that Congress would have to spend $115 billion more than originally predicted - yes, $115 billion more - to implement the bill. That would be enough to wipe out the projected deficit reduction over the first 10 years of the bill. Oops.

But Obamacare doesn't fully phase in until 2014, so its actual cost will be substantially more than the projection over the first 10 years suggests.

Wait, I'm not done yet. There's also the issue occupying the Senate this week, known as the "doc fix."

On June 1, a 21 percent reduction in physician reimbursements by Medicare went into effect. Before the Memorial Day recess, the House passed a bill that would have eliminated the fee reduction, but the Senate went home without taking any action. When senators return, they will confront the House proposal, which would add billions of dollars to the budget deficit.

As Obama and congressional Democrats try to force quick passage of more legislation, let this be a reminder that Americans should expect their representatives to clear the fog before bills pass, not after.


Rick Santorum can be reached at rsantorum@phillynews.com.

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