Commentary

Costs of Health Care Reform Becoming More Apparent

In the days before the new health care law passed Congress last year, then-House Speaker Nancy Pelosi famously said that we would “have to pass the bill to find out what is in it.” Well, it has been a year since the Patient Protection and Affordable Care Act passed, and we are now learning what was in it — much to the detriment of Tennessee taxpayers, businesses, doctors and patients.

Here’s some of what we now know:

You probably cannot keep your current insurance plan. Although the president constantly reassured us that Americans would not be forced to change their current plans, that increasingly appears untrue.

If you get your insurance at work, you will almost certainly have to change plans. The administration itself now admits that more than two-thirds of companies could be forced to change the coverage they currently offer their workers. For small businesses, the total could reach 80 percent. The new plans will have to offer additional benefits and meet new federal requirements, likely making them more expensive.

Moreover, the law’s individual mandate continues to pose a threat to Tennesseans’ ability to keep their current coverage. That mandate not only requires everyone to buy insurance, it also requires insurance to meet strict government requirements, offering the benefits the government thinks you should have, not necessarily those you want or need.

It will cost more than advertised. The Congressional Budget Office officially “scored” the health care bill as costing $950 billion. However, those numbers do not reveal the new law’s true cost. For example, CBO’s estimates do not include roughly $115 billion in implementation costs, such as the cost of hiring new IRS agents to enforce the individual mandate. The arcane budget rules of Medicare, Social Security and the law’s new long-term care program also allow the government to count savings twice while ignoring future costs outside the budget window. Finally, the law front-ends taxes while deferring costs, providing a misleading 10-year budget outlook. True accounting suggests that the law will cost as much as $2.7 trillion over 10 years of full operation, adding $823 billion to the federal deficit.

Your premiums are going up. Tennesseans opening their health insurance bills can already see that their premiums are not going down. In fact, CBO estimates that premiums could double over the next six-10 years. Worse, the new law may actually be increasing premiums faster than they would otherwise rise. Some estimates suggest that the law’s new regulations have already added 7-9 percent to insurance costs.

Your taxes are going up. The health care law imposes more than $569 billion in new or increased federal taxes over the next 10 years. And it’s not just federal taxes that are rising. The law will add more than 700,000 people to Tennessee’s Medicaid rolls, driving up the cost of the state’s program by more than 25 percent. That means either state taxes will go up, or other state services will be cut.

It’s not getting any more popular. These are just some of the reasons why half of Tennesseans want to see the health care law repealed, according to a recent poll by Middle Tennessee State University. Now that Pelosi has given them a chance to see what is in the bill, Tennesseans are wisely saying “no thank you.”

Michael Tanner is a senior fellow at the Cato Institute and author of “Bad Medicine: A Guide to the Real Costs and Consequences of the New Health Care Law.” Justin Owen is president of the Tennessee Center for Policy Research