CBO: Democrats Health Care Bill Will Raise Family Insurance Premiums by $2100 Per Year. IUSB Vision analysis proved correct again!
Posted by iusbvision on December 4, 2009
[Welcome Pajamas Media readers! – Editor]
After the “new and improved” healthcare bills came out of the Democratic Leadership from Congress we told you that these new bills are designed to make health insurance so expensive that people will cry out for a public option. This was obvious since the bills tax like crazy.
New taxes on medical devices, health services, taxes on health insurance benefits, new taxes on “cadillac insurance plans” that are not indexed to inflation so as time goes on more people have to pay the tax, new payroll taxes, new taxes on health savings accounts and the list goes on and on.
Obama promised that these bills will save the avg family $2,500 a year via an Obama campaign handout, “Questions and Answers on Health Care Plan”.
Only in Washington is healthcare made cheaper by taxing it up the wazoo.
The Congressional Budget Office has now confirmed our analysis (Hat Tip House Conference):
The Congressional Budget Office (CBO) today confirmed that legislation being considered in the Senate (H.R. 3590) would raise health care premiums for struggling middle-class families:
- The CBO analysis found that in the non-group market, average premiums would be “about 10 to 13 percent higher in 2016…than under current law.” The result would be a premium increase of $300 per year for individuals and $2,100 for families.
- CBO also found that the “user fees”-i.e., taxes-imposed in the Senate bill “would be largely passed through to customers in the form of higher premiums for private coverage.”
- Contrary to President Obama’s repeated promises that “You will not have to change [health insurance] plans,” CBO also found that “relatively few non-group policies would remain grandfathered by 2016”-meaning millions of individuals will lose their current individual health insurance plans as a result of Democrats’ government takeover of health care.
- While then-Senator Obama promised during his campaign that reform would lower health care costs by up to $2,500 per family annually, CBO’s analysis confirmed that provisions in the legislation would raise health care costs. Specifically, CBO found that raising the required level of coverage for the individual market would raise premiums on its own-and “reduced cost sharing” from the new, richer benefit policies “would lead to greater use of medical services, which would tend to push premiums up further.”
- While Democrats may claim that some individuals will pay lower premiums due to federal subsidies, those subsidies will help impose a new cost to the taxpayers of $2.5 trillion in the bill’s first ten years of implementation alone. Furthermore, because the Reid bill does not link subsidy levels to rising medical inflation levels, even trillions of dollars in federal subsidies will be insufficient for families to afford insurance if health care costs continue to rise faster than incomes. Given CBO’s analysis of health care cost growth as a result of provisions in the Senate bill, many may question the legislation’s ability to deliver on this critical goal.
- Although CBO stated that premiums in the employer-based markets may remain constant, that judgment is based in part on an assumption that an individual mandate will increase participation in group coverage by encouraging young and healthy people to take up their employer’s plan. However, some may find such a conclusion counter-intuitive, as many individuals may find it more affordable to circumvent the mandate and instead pay the tax penalty. For instance, the $2,250 maximum tax for a family not purchasing coverage in 2016 would be dwarfed by the $3,515 average family contribution for an employer-sponsored policy in 2009 alone.