At Forbes.com, Grace-Marie Turner summarizes the new taxes imposed by Obamacare:
- Medical Device Tax
- A new Surtax on Investment Income
- A new Medicare Tax
- The new Flexible Spending Account Tax
- ObamaCare also tightens the screws on Itemized Medical Deductions
Many more taxes are coming, including a “tax penalties” for individuals and businesses who don’t comply with ObamaCare’s mandate that they purchase government-approved health insurance. The Congressional Budget Office expects these penalties for non-compliance to bring in $160 billion in the first decade they are in effect.
ObamaCare’s $1 trillion in total tax increase hit everything from health insurers, drug companies, and tanning salons to Health Saving Accounts and – eventually – high-cost employer-based health insurance.
Read more: As 2013 Begins, Get Ready For An ObamaCare Tax Onslaught.
See also: “An Unhealthy Dose of Obamacare Taxes” at Reason.com.
At Forbes, Avik Roy writes:
[A] new study by two members of the American Academy of Actuaries finds that tens of millions of Americans will be exposed to increased insurance costs, even when one takes the value of Obamacare’s subsidies into account.
The new report, authored by Kurt Giesa and Chris Carlson, was published in the latest issue of Contingencies, the American Academy of Actuaries’ bimonthly magazine. (Actuaries are people who specialize in the design and structure of insurance plans.) Their analysis focuses on Obamacare’scommunity rating provision, the piece of the law that forces young people to pay dramatically more for health insurance in order to partially subsidize the cost of insurance for older Americans. …
“Our core finding is that young, single adults aged 21 to 29 and with incomes beginning at about 225 percent of the FPL, or roughly $25,000, can expect to see higher premiums than would be the case absent the ACA, even after accounting for the presence of the premium assistance.” Fully 80 percent of these twenty-somethings have income above $25,000.
Read more: Insurance Analysts: Obamacare to Increase Out-of-Pocket Premium Costs, Despite Lavish Subsidies – Forbes.
From the National Center for Policy Analysis:
While the President contemplates a gun control agenda that could restrict American rights to own guns, the President quietly signed legislation on January 10 that provides the “lifetime Secret Service protection of former Presidents.”
As if former U.S. Presidents could not afford to pay for this with their own money, which includes a six-figure pension funded by taxpayers.
From Peter Suderman at Reason.com:
Over the weekend, The New York Times published a report noting that health insurers across the nation are both “seeking and winning double-digit increases in premiums” — this despite the fact that “one of the biggest objectives of the Obama administration’s health care law was to stem the rapid rise in insurance costs for consumers.” …
What’s going on? Why are these rates going up?
Suderman explains how mandated benefits explain some of the increase. He then explains a less obvious culprit: mandatory medical loss ratios. Suderman writes:
The MLR is an accounting requirement which says that insurers have to spend at least 80 percent of their total premium revenue on medical expenses, leaving just 20 percent for administrative costs, marketing, and other non-medical expenditures. Any insurer that fails to meet this target must issue rebates to customers. This year, insurers rebated about $1 billion.
The MLR provision creates two incentives for insurers to jack up health insurance premiums. One is the plain fact that with profit and administrative costs capped as a percentage of premium revenue, the easiest way to generate larger profits is to charge higher premiums.
The other is that the rebate requirement means insurers may need to charge higher up-front premiums in order to protect themselves from the risk of a bad year.
Read more: Is ObamaCare Causing Health Insurance Premiums to Rise? – Hit & Run : Reason.com.
Michael Cannon at Cato writes:
There have been several developments with respect to the Obama administration’s attempt to impose the Patient Protection and Affordable Care Act’s employer-mandate penalties and individual-mandate penalties where it has no authority to do so.
Read about it here: The Obama Administration’s Illegal Health Care Taxes: an Update | Cato @ Liberty.
In the Denver Business Journal, Ed Sealover describes the effect of Gov. Hickenlooper’s proposed Medicaid expansion on businesses:
The most direct effect of the move on general businesses could be a long-term slowing of the growth of health-insurance costs if hospitals can reduce the cost of uncompensated care for uninsured patients — which they now pass along to patients insured by employers by increasing their costs of care.
I left the following comment:
This analysis does not account for how much Medicaid, through low doctor payment rates, increases insurance premiums. This amount is much more than the amount uninsured people increase premiums when they do not pay part of all of their medical bills. For details on this, see my article: Your Health Care; Don’t Trust the Colorado Trust.
Colorado Governor John Hickenlooper wants to drag more low-income people into Medicaid, which is notorious for fraud, delivering lousy care, poor access. Instead of expanding this failed government dependency program, Colorado should look at Florida as an example of effective Medicaid reform.
Benjamin Domenech of the Heartland Institute summarizes the Florida’s pilot program involving premium support for commercial insurance. (“Premium support” differs from a voucher.) Domenech writes:
A little more than six years ago, Florida Gov. Jeb Bush established a pilot program in five large counties in Florida with a total overhaul of Medicaid. Under the pilot program, more than 300,000 Medicaid recipients—bigger than the total programs in 17 states—were given the choice of a wide variety of plans created by multiple insurers. …
In the program, Medicaid recipients get to choose among a dozen different plans with different offerings. The plans compete on benefits, copays, and provider networks, and offer risk-adjusted capitated rates, allowing for better matching of payment to risk to prevent insurers from avoiding sick people. …
The program has achieved results. According to the Florida Agency for Health Care Administration, the health outcomes are 64 percent better than under a managed care system, with 83 percent higher satisfaction from those in the program. Florida is currently saving roughly $118 million a year on Medicaid in the five counties, with better outcomes for the people in it.
The Denver Post reports:
Colorado plans to expand Medicaid coverage next year to cover more than 160,000 additional low-income adults, aided by cost-control savings of more than $280 million over the next 10 years, Gov. John Hickenlooper announced Thursday.
“This is a step toward what we have talked about for a couple of years: How can we make sure we’re making Colorado the single healthiest state in America?” Hickenlooper said.
Apparently the governor is not familiar with how lousy medical care is for people stuck in the Medicaid ghetto.
The article continues:
The state’s ability to embrace the health-care expansion draws on “a relentless focus on how to control costs,” Hickenlooper said. The Department of Health Care Policy and Financing zeroed in on several areas of projected savings, largely by rewarding value over volume.
The article then quotes from Linda Gorman of the Independence Institute on why these savings are unlikely and that Medicaid expansion is a bad deal for the poor. A better policy, she said would provide them access to commercial insurance.
Read Gorman’s comments: Colorado governor proposes Medicaid expansion – The Denver Post.
Some perspectives from Reason and the Cato Institute on the bipartisan deal to avoid the “fiscal cliff”:
As the fiscal cliff standoff [has passed] ultimate year-end deadline, neither President Barack Obama nor Speaker John Boehner has seriously talked about making the sorts of spending cuts that recent economic research suggests would help spur near- and long-term growth while cutting the national debt.
That’s not surprising, say Nick Gillespie and Veronique de Rugy, given how much government spending has grown while these two have been part of the federal government. But it’s time they – and other legislators – learn the recent lessons from countries such as Sweden, Canada, and the U.K. (and post-World War II America) and get their fiscal act together.
Read Gillespie & De Rugy’s article at Reason.com, or at Bloomberg, where it first appeared.
See also The Doc Fix Economy: If you want to understand the fiscal cliff, you need to first understand the doc fix.