President Joe Biden’s $1.9 trillion COVID-19 stimulus was perhaps, next to the border crisis he created, the worst misgovernment of his presidency, although competition for that shameful accolade is fierce. By funneling hundreds of billions of dollars in temporary spending into a rapidly heating economy through programs such as enhanced unemployment insurance, expanded child tax credits, and food stamp “emergency allotments,” Biden fueled the worst inflation in a generation, sending prices soaring past wage gains and making almost everyone poorer.
Now that the last of these temporary spending boosts, the enhanced tax subsidies for health insurance premiums, are coming to an end, Democrats have shut down the federal government in an effort to preserve them forever. Republicans should resist this blackmail and not waver, so the last of America’s COVID madness can end.
When Biden passed his $1.9 trillion COVID stimulus bill without any Republican votes in 2021, the Affordable Care Act subsidy expansion was estimated to cost just $22 billion through the end of 2022. At that point, Democrats tried to make the Affordable Care Act subsidy expansion permanent as part of the inaptly named Inflation Reduction Act, but their proposed 10-year expansion made it impossible for them to claim it was paid for. So they set the subsidies to expire at the end of this year at an estimated cost of $64 billion over two years. This was almost three times the Congressional Budget Office’s original two-year estimate only two years earlier.
Now, Democrats demand a permanent extension of the Obamacare COVID subsidy bonus in exchange for their permission for the government to function again. Their proposed spending spree for something that was claimed to be temporary when it was put in place five years ago is now estimated by the CBO to cost another $350 billion over the next 10 years. When those 10 years have passed, the Democrats would doubtless come back and insist it be extended to the crack of doom.
Democrats say that if the subsidies expired, the price of health insurance would rise for the 5% of people who qualify for premium credits. That’s true, but the increases would not be due to subsidies that are enriching health insurance companies. They would be due to excessive restrictions, insisted on by Democrats, as to the types of health insurance people are allowed to purchase. According to data from Paragon Health Institute, the cost of an individual market insurance plan has tripled since Obamacare became law, far outpacing inflation, and taxpayers pay most of the tab.
In 2013, before Obamacare, a typical health insurance premium for a 50-year-old was about $3,000 a year, paid entirely by the person insured. By the time COVID hit, premium costs had jumped to almost $8,000, with 80% of that coming from taxpayers through ACA subsidies, so individuals paid about $1,600.
The COVID bonus subsidies raised that percentage to 93%, so the price paid by consumers fell to $500 while the cost picked up by taxpayers continued to rise. With the expiration of the bonus subsidies, the percentage of the cost for health insurance premiums paid by taxpayers would fall back to 80%, the pre-COVID level. But because taxpayers have picked up the extra cost since COVID, the price paid by individuals will rise to about $2,000. This would produce some sticker shock, but it is just the end of a COVID subsidy that should have ended long ago, and it would still be less than people used to pay. Biden and the Democrats essentially got ACA marketplace participants hooked on subsidies. What they want is what they have always wanted — permanent socialized healthcare.
CHICAGO HAS NO SOVEREIGN RIGHT TO ITS OWN IMMIGRATION POLICY
Health insurance company revenues and profits have almost doubled since Obamacare mandates and regulations became law. There is no bigger supporter of the subsidies than the health insurance industry. The main reason health insurance prices are rising is Obamacare. Congress should fix the underlying problem, not keep forcing taxpayers to fund it.
Finding a bipartisan solution to lowering health insurance prices without raising deficits is a challenge that will not be solved before millions of government workers and thousands of troops miss paychecks because of the Democrats’ shutdown. Democrats should end the shutdown now and work with Republicans to lower health insurance premiums without padding health insurance company profits.
