03.16.2012 2

Deconstructing Obamacare

Barack Obama delivering the State of the Union

Photo Credit: White House

By Howard Rich — The stated objective of Barack Obama’s socialized medicine law is to expand access to quality, affordable health care in America — hence the statute’s title, the “Patient Protection and Affordable Care Act.”

As far as intended outcomes are concerned, greater access to lower cost health insurance is certainly a desirable objective. Shrinking the ranks of the uninsured would produce a contraction of America’s welfare state, thus reducing taxpayer obligations associated with dependency. Meanwhile lowering health care costs would create more disposable income, thereby stimulating the nation’s consumer economy.

Clearly these outcomes will not be achieved by Obamacare, though. Instead this Orwellian nightmare will have precisely the opposite effect: dramatically increasing federal outlays (by an estimated $2.5 trillion over its first decade) while limiting disposable income on multiple fronts, not the least of which is its estimated $500 billion in tax hikes.

Like most unnecessary expansions of government, Obamacare doesn’t achieve its objective of “affordable” coverage either. As Obamacare’s first round of mandates and tax hikes kicked in last year, family health care costs soared by nine percent. And according to projections released by the Office of the Actuary in the Centers for Medicare and Medicaid Services, net health care costs for 2014 — the first full year of the law’s implementation — will increase by 14 percent.

Why is this happening? Because Obamacare is based upon several fatally flawed assumptions — most notably that government can run the health care industry better than the free market.

According to the Obama administration, new taxes, bureaucracies, regulations and entitlement obligations are the keys to making health care less expensive. Such a premise — like other big government machinations — is illogical on its face. Honestly, are we to believe that a country which is already struggling to afford these costs will be magically able to manage them once the weight of this Orwellian nightmare has been placed over our health care system?

“If you think health care is expensive now, wait until you see what it costs when it’s free,” P.J. O’Rourke famously said nearly two decades ago.

Sadly, America is about to find out that cost.

Obamacare contains at least twenty tax hikes — including the insidious “individual mandate excise tax,” which would impose a surtax on Americans who fail to purchase health insurance from a “qualifying” provider. There’s also an employer excise tax, a job-killing surtax on investment, Medicaid payroll tax increases and numerous other levies.

And since we know that these tax hikes (and the mountain of deficit spending that’s accompanying them) aren’t “purchasing” lower health care costs for Americans — what are taxpayers spending all of that money on?

That’s easy — vast layers of new and expanded bureaucracies.

Obamacare creates no fewer than 159 new programs — a mammoth expansion of an already bloated federal government that will result in the hiring of thousands upon thousands of new taxpayer-funded employees.

This year, for example, the Internal Revenue Service requested nearly $400 million in additional funding to hire 1,054 new employees. Why? Because according to the agency, Obamacare “represents the largest set of tax law changes in more than 20 years, with more than 40 provisions that amend the tax laws.”

Among the items included in the IRS request? Thirty million dollars to “administer new fees” on insurers, $11 million to “promote compliance” with Obamacare’s new tanning salon tax and $10 million to “strengthen oversight” of those medical facilities fortunate enough to be exempt from the law’s most onerous provisions.

In addition to ballooning budgets at existing bureaucracies, Obamacare creates dozens of new ones – ranging from the swarm of agencies tasked with implementing its statewide health care “exchanges” to dozens of smaller councils, committees and grant programs like the “Indian youth life skills demonstration project” or the “demonstration projects for nursing facilities involved in the culture change movement.”

How far the federal government has come since 1798 – when President John Adams broke the seal on government-funded health care by authorizing taxpayer-funded medical care for merchant seamen. In fact, television host Glenn Beck recently noted that the various new government programs created by Obamacare vastly outnumber those created during the entirety of Franklin Roosevelt’s “New Deal.”

At a time when America desperately needs to restore the primacy of the free market, Obamacare marks an unprecedented step in the wrong direction. If our leaders’ goal is truly to provide “affordable care,” then this monstrosity must be repealed and government’s role in health care must be dramatically scaled back.

The author is chairman of Americans for Limited Government.

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