Understanding Health Care Reform

INTRODUCTION. The Patient Protection and Affordable Care Act is upon us. Whether we like it or not, beginning January 1st, 2014, all Americans not eligible for Medicare nor otherwise exempt will be required to purchase health care coverage or pay the appropriate tax penalty for failure to comply with this sweeping legislation.

While ludicrous to think that this legislation can please everyone, there is some merit to the law. Health care needs reformation. The real question is whether this legislation will actually curb spending on health care, create affordable health insurance coverage for Americans, provide coverage for all the uninsurable Americans, and be a positive force of change in America. Or will it simply create another entitlement for Americans while fattening America’s already bloated national debt.

There are certainly many reasons for concern. In no particular order, below and on the next page here are the most topical issues concerning so-called ObamaCare and health insurance reform in America:

COST.  Not just cost of premiums but cost to America. Projected deficit spending associated with this landmark legislation is not likely to ever be recovered. America’s millennial population is faced with higher future taxes – an unjust position considering they never had a voice in the spending process. It puts Americans one step closer to a single payer system. Many Americans wish to reshape the American health insurance model into a government-administrated single payer system. In other words, socialized medicine. Based on current legal and ethical medical standards, the cost of healthcare will definitely be affected. Arguments prevail on both sides. One thing we’re certain of is that when government controls your health care, they control you.

SECURITY. It has been confirmed by the government that the IRS websites associated with the PPACA are not secure. All American’s health, financial, and dependent data will potentially be available to identity theft, including banking, credit card and social security numbers. Why should any American’s personal security be compromised by his or her own government?

MEDICAID EXPANSION.  The PPACA actually raises the poverty level by 138 % from its current level of $11,490 for Americans. Not approved by 26 states because of cost, The federal government tied Medicaid expansion directly to the subsidies for the poverty stricken and working poor. Now those so afflicted, living in states that did not approve Medicaid expansion, will receive no subsidy at all. Their children however will be covered up to age 18. Ironically, those who can least afford to pay for health care will have to pay, receive no subsidy, pay taxes for non-compliance, and know that others living in the same state – making substantially more income wise – will qualify for subsidies. Ultimately, this will lead to more expenditure by each state and undoubtedly to higher state taxes without solving the problem. Why are the victims here the very citizens the new health insurance law was designed to help?

COMPLIANCE.  Corporations, religious orders, minority groups, labor unions, and government employees (including Congress) have asked for exemptions from the law. Many were granted this exemption. Others were not. Many of the largest companies in America claim they cannot provide insurance without destroying their bottom line. Some employers deliberately reclassified employees as part time (under 30 hours/week) to avoid purchasing health care for them. This trend is affecting every job sector in America. The list includes fast food, manufacturing, transportation, retail, education, and medical providers. How can Americans be expected to buy health care coverage when faced with less work, less pay, and more taxes? This exacerbates the failure of current economic recovery policy while creating more unemployment in America.

LEGAL IMPLICATIONS.  Our President has taken it upon himself to sweep aside certain aspects of the law. The most critical of these was the employer mandate. Instead of providing coverage or paying a tax penalty, employers with over 50 employees are exempt from enforcement of the law until 2015. From Chambers of Commerce to The National Federation of Business, business groups across the country are an uproar. Factoring in extra costs for PPACA compliance will make small employers less competitive against their larger, exempted rivals. How can the President ignore or fail to uphold a law passed by Congress as defined by our Constitution? Lawsuits are already being filed. Can the same people who demand redistribution of wealth not see the inequity of this decision? The rich will get richer as competitive balance shifts away from the small employer. Why aren’t we all treated equally under this law? Aren’t we all Americans?

TAXES. Funding this legislation are 21 new taxes. There are taxes for patient encounter, reinsurance, and market value adjustments. There are taxes on medical devices, tanning salons, and even bio-diesel fuels. And these taxes aren’t cheap. The reinsurance tax is $65 per insured per year. The market value adjustment tax will be 2.4% of premium for each business. Some of these taxes are being collected by the federal government through your health insurance premium billing. All Americans will pay them. Those currently insured already do pay them, including those groups who received a valid waiver from the government. All exempt labor unions and employers were still sent tax notices by the IRS. The IRS maintains that exemption from the law did not include exemption from taxation. Levying taxes to fulfill a mandate seems self-defeating when the goal was to make it more affordable. Remembering the words of Margaret Thatcher is valuable right now – “The problem with socialism is that you eventually run out of other people’s money.”