When government says it’s set to do something for the little guy, hang on to your wallet.
The latest evidence for this came in a congressional report released last week, showing that the seniors lobby (and insurance giant) AARP stands to make more than $1 billion as a result of ObamaCare.
The game works this way: The new health‐care law contains more than $136 billion in cuts to the Medicare Advantage program, which now covers one in five seniors. As a result, according to Medicare’s chief actuary, at least 7 million seniors will be forced out of their Medicare Advantage plan and back into traditional Medicare.
But since traditional Medicare lacks several Medicare Advantage benefits, many will have to buy so‐called “Medigap” policies to make up the difference. And who’s the nation’s largest marketer of Medigap plans? The AARP.
An 18‐month congressional probe found that the AARP stands to make $55 million to $166 million in one year alone from seniors switching from Medicare Advantage to AARP Medigap plans. Over the next 10 years, it would earn more than $1 billion from new customers. Business is good if you can get the government to put your competitors out of business.
The AARP isn’t the only big ObamaCare winner to come to light in the last few days. A hearing by the House Energy and Commerce’s Subcommittee on Oversight and Investigations disclosed that labor unions and big businesses — including General Electric, Verizon, AT&T and IBM — have received nearly $1.9 billion in payments under the new health‐care law to help offset health‐insurance costs for early retirees.
The biggest single recipient: the United Auto Workers, which got nearly $207 million in taxpayer money. By the time the feds finish handing out funds to well‐connected companies and unions, it’s expected to have cost taxpayers $5 billion.
The program doesn’t even require companies or unions to demonstrate any “financial need” for the subsidy. As a result, it enables companies to incentivize early retirement for older employees, saving the companies money and improving their balance sheets — with taxpayers footing the bill.
This is nothing new, of course. ObamaCare has benefited special interests and big businesses from the start. The major pharmaceutical firms got a requirement that all insurers must cover their products. That’s one reason why Big Pharma spent more than $150 million on ads in favor of the bill.
Other provider groups and beneficiary constituencies are pursuing a similar strategy. They’ve been lobbying a government panel that will determine the benefits that must be included in every insurance plan. At recent hearings, interests ranging from the in‐vitro‐fertilization industry to autism groups showed up to demand their share of the spoils.
Even large insurers played the game: They got a mandate requiring everyone to buy their product. Sure, they’ll have to adjust to some costly new regulations, and those added benefits will be expensive, but they can simply pass the costs on to consumers via higher premiums. After all, what can consumers do? If they decide not to buy insurance, the government will punish them.
Nor should we forget that politically connected firms and unions have regularly received waivers from ObamaCare’s worst provisions.
So one year in, ObamaCare’s big winners are becoming clear: Big Business, Big Labor and special‐interest lobbies. The only losers are the American people.