The truth about the Baucus bill - Part Two
Examiner Editorial
October 12, 2009
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Like the proverbial mackerel rotting on the beach in the moonlight, the Obamacare bill produced by Senate Finance Committee Chairman Max Baucus both shines and stinks. The shine was applied last week when the Congressional Budget Office said its preliminary analysis of a conceptual description of the proposal showed it would reduce the federal deficit by $81 billion. The stink is the reality noted in this space Sunday: The Baucus bill is conservatively estimated to add $829 million in new spending to the federal budget and somebody will have to pay for it. The closer one looks at the Baucus proposal, the more intense becomes its stench.
As The Examiner's Susan Ferrechio reported last week, there are a variety of provisions in the bill designed to generate revenue, including $426 billion in Medicare and Medicare Advantage benefit cuts, $4 billion in new fines imposed on those who do not purchase insurance, $201 billion in new levies on health insurance companies with high-end health insurance plans, $180 billion in new taxes on medical devices and drugs, $83 billion in new income taxes on individuals, and $25 billion in new taxes on employers. There will also be significant reductions in Medicare reimbursements to hospitals, which will in turn generate more cost shifting from such facilities to the patients using them.
In terms of the effect on individuals and families, a study conducted by PricewaterhouseCoopers for the health insurance industry calculates that while the cost of coverage for the average family is now $12,300, under Baucus it will increase to $21,300 by 2016. Without Baucus, it would rise only to $18,400. For individuals who currently pay on average $4,600, the cost will go up to $7,900 if Baucus becomes law, compared with $6,900 if it does not. Obamacare advocates argue that these costs will be largely offset by tax credits for lower-income families, but tax credits simply shift the burden of payment from Peter to Paul.
Clearly, the health care reform debate has come a long way from the evening of the last nationally televised presidential debate in which then-Democratic candidate Barack Obama said "we estimate we can cut the average family's premium by about $2,500 per year." But this is the same Obama who promised "a net federal spending cut" during the campaign, then added $1.4 trillion to the federal deficit in a mere eight months in office.
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