Robert L. Ehrlich Jr.
12:03 PM EDT, May 24, 2013
On this Memorial Day weekend, as we remember with deepest gratitude the sacrifice of America's military heroes, we also offer our thoughts and prayers for the victims of the Oklahoma tragedy.
I've dedicated a half-dozen columns to the single most dangerous federal law passed in many years, the (not so) Affordable Care Act (aka "Obamacare").
History buffs observe that landmark pieces of legislation typically pass Congress with some degree of bipartisan support. (See, e.g., the Voting Rights Act of 1965, the Civil Rights Act of 1964, the Social Security Act of 1935 and the Medicare Act of 1965). Obamacare, however, is the exception; it failed to garner a single GOP vote. The president's signature legislative achievement was strictly a 962-page partisan affair, chock full of provisions unfamiliar to most members who voted to pass it. Recall the immortal words of then-Speaker Nancy Pelosi, "… we have to pass the bill so that you can find out what is in it."
Well, the American people are beginning to understand "what is in it." And many are none too pleased.
As the numerous complexities (latest Obamacare regulatory word count: 2,864,094), contradictions and costs of Obamacare begin to register with the public — most notably employers — increasing disgruntlement emerges from high profile Democrats:
•"A trainwreck" — Senate Finance Chairman Max Baucus;
•"Beyond comprehension" — West Virginia Sen. Jay Rockefeller;
•"Let's just make sure [Obamacare is] not a third world experience" — Henry Chau, chief technical officer in charge of implementing Obamacare's insurance exchanges.
The concern is easily understood: Obamacare's primary pillars are crumbling. Witness the following oversold promises:
•"If you like your health care plan, you can keep your healthcare plan." — President Barack Obama
Well, not really. Numerous surveys reflect that Obamacare will cause a drastic decrease in the number of employers who offer health insurance. Recent congressional oversight hearings confirm the worst suspicions of Obamacare opponents: Many large businesses are deciding to pay a fee rather than continue coverage; many are converting full-time employees to part-time status; and employees who are losing coverage are experiencing great difficulties in signing up for new state insurance exchanges.
•"[Obamacare] will cut the cost of a typical family's premium up to $2,500 a year." — President Obama
Well, not really. Even Obamacare proponents admit that millions of Americans will suffer a steep increase in their health care premiums. This is especially true for young, single adults. Most studies forecast a 40 percent to 50 percent increase for this demographic, even after premium assistance is included.
The news is only slightly better for employees of small businesses. The large insurer WellPoint concluded (in an 11-state analysis) that Obamacare-mandated small-group premiums will increase 13 percent to 23 percent. But government subsidies for small-group participants are minimal. The bottom line: higher insurance premiums for up to 10 million employees in the small-group market. What — you believed Obamacare's community rating provisions (placing older, sick people in the same risk pools as young, healthier people) would not impact premiums? FYI: The few states that already use this type of community rating have the highest premiums in the country.
•"[Obamacare is] not only about the health security of Americans ... In its life it will create 4 million jobs, 400,000 jobs almost immediately." — Ms. Pelosi
Well, not really. A recent U.S. Chamber of Commerce survey revealed that 74 percent of small businesses believe Obamacare will make it more difficult to hire new employees. More daunting is the Congressional Budget Office's estimate that the tax and regulatory burdens generated by the new mandates will lead to 800,000 fewer U.S. workers by the end of 2020. In the words of CKE Restaurants CEO Andrew Puzder: "[The ACA] explicitly makes labor more expensive. It is completely predictable that businesses such as ours will search for ways to take jobs out of existing restaurants to reduce that expense." None of this should surprise even casual observers; increased labor costs always lead to reduced employment.
•"[T]hese reforms would greatly benefit Americans from all walks of life, as well as the economy as a whole." — President Obama
Well, not really. A new gross receipts tax on medical devices may be the single most damaging of Obamacare's 18 new tax hikes.
Congress has been inundated with industry requests to repeal the law. Several Democratic senators have requested delayed implementation. Major employers such as Welch Allyn, Stryker, Boston Scientific and Medtronic have announced significant layoffs. The Advanced Medical Technology Association estimates the new tax will cost 43,000 jobs. This levy is the grand slam of bad policies: enhanced development costs, fewer (life enhancing) inventions, lost jobs, and the migration of manufacturing jobs overseas. A mighty bad outcome for American health care.
Oh, in case you forgot, Obamacare will likely require the hiring of thousands of new IRS employees. You may have heard of this agency; they have been in the news lately. And not on the side of the taxpayer … what a mess!
Robert L. Ehrlich Jr.'s column appears Sundays. The former Maryland governor and member of Congress is a partner at the law firm King & Spalding and the author of "Turn this Car Around," a book about national politics. His email is firstname.lastname@example.org.
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