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  • Morning Bell: Obamacare's True Costs Coming to Light

    Remember how President Barack Obama promised that his health care plan would reduce the deficit and put us on a path towards fiscal responsibility? Remember how Congress kept gaming the system to come up with the Congressional Budget Office (CBO) score that could justify those claims? Well, now that Obamacare has become (hopefully only temporarily) the law of the land, the CBO is singing a slightly different tune. Last Friday CBO Director Doug Elmendorf wrote on his blog:

    The central challenge is straightforward and stark: The rising costs of health care will put tremendous pressure on the federal budget during the next few decades and beyond.

    In CBO’s judgment, the health legislation enacted earlier this year does not substantially diminish that pressure. In fact, CBO estimated that the health legislation will increase the federal budgetary commitment to health care (which CBO defines as the sum of net federal outlays for health programs and tax preferences for health care) by nearly $400 billion during the 2010-2019 period. Looking further ahead, CBO estimated that the legislation would reduce the federal budgetary commitment to health care in the following decade—if the provisions of the legislation remain unchanged throughout that entire period.

    And there is ample evidence that the CBO may be underestimating Obamacare’s true costs. Ethics and Public Policy Center Fellow James Capretta details:
    Omission of the Medicare “Doc Fix.” The Obama Administration and leaders in Congress chose to use all of the tax hikes and spending cuts they could find to create another new entitlement instead of paying for a fix for Medicare physician fees (the so-called “doc fix”). Under current law, those fees are set to get cut by 21 percent in June. The Obama Administration wants to undo the cut permanently, but it does not provide any offsetting savings. The result will be a spending increase of between $250 billion and $400 billion over a decade. Passing an unfinanced “doc fix” wipes out all of the supposed savings from the new legislation and greatly adds to the burden on future taxpayers.

    The CLASS Act Gimmick. The new health law creates a voluntary long-term care insurance program, called the Community Living Assistance Services and Supports (CLASS) Act. Those who sign up for it must pay premiums for five years before becoming eligible for benefit payments. Consequently, premiums paid by enrollees build a small surplus—about $70 billion over 10 years according to CBO—which the health law’s proponents claim as deficit reduction. But these premiums will be needed in short order to pay actual claims.

    Medicare Cuts. CBO and the Chief Actuary for the Medicare program have both stated that Medicare spending cuts cannot be counted twice—to pay for a new entitlement expansion and to claim that Medicare’s financial outlook has improved. But that is exactly what the proponents of the new legislation do. If the Medicare cuts and tax hikes for the hospital trust fund (about $400 billion over 10 years, according to CBO) are used solely to improve the capacity of the government to pay future Medicare claims, then the health law becomes a massive exercise in deficit spending.

    Estimates of Employees Dropped from Job-Based Coverage. The new insurance arrangements in the state-based exchanges will provide massive new subsidies to low- and moderate-wage households. For instance, at 200 percent FPL, the subsidy for a family of four will reach nearly $11,000 in 2014. But CBO estimates that only 3 million Americans will move from job-based insurance into the exchanges to take advantage of the subsidies, even though there are about 130 million Americans under age 65 with incomes between 100 and 400 percent FPL. Douglas Holtz-Eakin and Cameron Smith of the American Action Forum have estimated that as many as 35 million people will be moved out of job-based coverage and into subsidization. If that is the case, the 10-year cost of the coverage expansion provisions would jump by $400 billion more.

    According to one recent estimate, Obamacare will add more than $500 billion to the deficit over the next 10 years and $1.5 trillion in the decade following. No wonder support for the repeal of Obamacare continues to grow.

    Quick Hits:

    • According to a new Quinnipiac poll, 51% of Americans approve of Arizona’s new immigration enforcement law, and by a 48% – 35% margin American voters want their states to pass an immigration law similar to Arizona’s.
    • Turkish Foreign Minister Ahmet Davutoglu called the deaths of nine Gaza blockade runners “like 9/11 for Turkey.
    • The National Association of Insurance Commissioners (NAIC) missed an Obama administration deadline to set standards for Obamacare’s insurance price control regime.
    • Thanks to the economic downturn, at least a half-dozen cash-poor states are now delaying taxpayer tax refund checks.
    • In a big setback for A.I.G. repaying taxpayers, Prudential of Britain pulled out of their agreement to buy AIG’s Asian life insurance business.
    Posted in Ongoing Priorities [slideshow_deploy]

    52 Responses to Morning Bell: Obamacare's True Costs Coming to Light

    1. Anita Metairie says:

      This this bill was passed on lies and deciet, I think it should be an illegal law. Repeal the damn thing a 100%. All of you who we are supporting for the reason of repealing this law and many other socialistic agendas better not be pulling our legs. We are tired of being ignored and lied to.

    2. Scott A Olson, Redla says:

      The aim of the CLASS Act is not to create a new government entitlement program. It will be funded by the premiums of the participants (similar to Medicare Part B).

      The CLASS Act's $50 per day "average benefit" will only cover a small portion of the $75,000+ per year most Americans pay right now for in-home care. Most people who want to protect their savings will still need to purchase long term care insurance.

      One of the biggest problems our country faces is that most Americans still think that Medicare or their medical insurance covers the cost of long term care.

      The CLASS Act addresses this problem by making a very clear statement: You have to pay for your own long term care. You either have to pay for your own long term care by using your savings, the $50 per day CLASS Act benefit, long term care insurance, or a combination of these.

      Most of the ten million Americans who own long term care insurance, own it because they've seen friends or family have to spend down their assets before qualifying for Medicaid. The CLASS Act will help alert the rest of the country to the fact that they need to financially plan for their future long term care needs.

      The CLASS Act will not be an option for those who are already disabled (and unable to work) or those who are retired and do not want to work. The law requires that in order to qualify for benefits, one must pay premiums for 5 years AND must be working for at least 3 of those 5 years.

      The legislation also requires that the CLASS Act program:

      • be actuarially sound,

      • not be funded by taxes, but all benefits must be paid from the premiums of the participants in the program, and

      There are 2 reasons the projected premiums for the CLASS Act are much higher than a comparable long-term care insurance policy.

      1) Anyone who is working (even just part-time) can enroll in the CLASS Act regardless of their health history.

      2) Those who earn less than the federal poverty level will be automatically enrolled in the CLASS Act for only $5 per month (unless they opt-out). Their premiums are being subsidized by the rest of the enrollees.

      Scott A. Olson
      http://www.LTCInsuranceShopper.com

    3. GRP says:

      What a shock! Who didn't expect this. Better to ask forgiveness than permission is the mantra of Obamas regime.

    4. Mary.... WI says:

      I think all of us that didn't want Obamacare knew the bill would cost more than BO claimed. But it just had to be passed quickly to help all the people without insurance………What a bunch of stinking baloney! And now here we are deficits long enough to reach Mars! Congress just couldn't wait for the entrie report from the CBO….morons! How absolutely assanine to go ahead with this bill in spite of other countries switching back to private insurance. We sure do look foolish!

      My hope is that

      folks in the administration and congress are found guilty of :

      1. Not thouroughly looking into the requests by BP for changes in how their rigs operate.

      2. Offering Sestak a bribe NOT to run agaissnt Specter

      3. Eventually all of the administration and dems in congress tried for treason for the ruination of the United States of America

    5. Steven Coy Westminst says:

      Heritage, have they figured in the 40-100 million that will that will pour through our borders when AMNESTY hits. Have they factored in the 3rd world Diseases that will come with them???????????????????????????? How about the loss of revenue when those millions are hired over our American workers and get minimun wage salaries and don't pay taxes. Our Representatives are clueless, this is the end of our Country and these Anti American Politicians should be Hanged, NOW!!!!!!!!!!!

    6. Ken Jarvis - Las Veg says:

      The ONLY thing the HF, Cs, GOPs, Murdoch, Rush and the rest of

      the HATE GROUP

      "CARE" ABOUT IS $$$.

      Obama CARES about ALL People.

      LVKen7@Gmail.com

    7. George Wrigh says:

      What a surprise! Obama, Pelosi and Reid led one of the greatest frauds imposed upon the American people.Collectively they were lying from day one concerning Obamacare……I know they can live with themselves since the are so comfortable with untruths.

    8. Gary says:

      Oh, what a shock! This was NEVER about "health care," it is a thinly veiled overthrow of the American Constitutional Rebublic by Marxist Idealogues.

    9. Richard Cancemi, Arl says:

      Everything the Progressives present to the public is based on lies, after lies, after lies. There is no honor among them. They are hell-bent on turning the USA into a Socialist State of the World. Obama is not wanting any repairs, restorations, or fixes that will maintain America as a successful Republic.

      I am sick of this man; I can hardly stand to hear him talk; he is repulsive as a President! He is a Traitor to all our Founding Fathers stood for. Like what the Barbarian and Muslim invasions brought about, Progressivsm will also bring about a Dark Ages for the peoples of the world! It must be stopped and reversed!

      A world of slavery to the state should be abhorrent to all!

    10. Ben C. Ann Arbor, MI says:

      Well intended legislation by the ill-advised and uninformed with ulterior motives always leads to unintended negative consequences. In this situation Congress and the POTUS knew excactly what there were doing and the outcomes are predictable. Something about Greece comes to mind.

    11. Richard Cancemi, Arl says:

      Richard Cancemi, Arlington, TX on June 2nd, 2010 at 9:28am said:

      Everything the Progressives present to the public is based on lies, after lies, after lies. There is no honor among them. They are hell-bent on turning the USA into a Socialist State of the World. Obama is not wanting any repairs, restorations, or fixes that will maintain America as a successful Republic.

      I am sick of this man; I can hardly stand to hear him talk; he is repulsive as a President! He is a Traitor to all our Founding Fathers stood for. Like what the Barbarian and Muslim invasions brought about, Progressivsm will also bring about a Dark Ages for the peoples of the world! It must be stopped and reversed!

      A world of slavery to the state should be abhorrent to all

    12. Lloyd Scallan - New says:

      Wow, what a surprise! Did anyone NOT know this was coming? Obama and the Dems did not make those "deals" and pay those "bribes" to have the American people overturn Obamacare. Get ready for a major fight to the death and distortion campaign by the left-wing media. The big question is does the American people have the "balls" to fight for their freedoms?

    13. Drew Page, IL says:

      Obama's health care reform initiative may have had a noble purpose, that being to bring health care to all Americans, but that's where the nobility in the process ended. From day one, the public was treated to a litany of half-truths, deceptions and outright lies. Mr. Obama's promise to post all proposed legislation on the internet; his repeated promises to make transparent the process and debate among doctors, nurses, hospital administrators, representatives of the pharmaceutical companies, insurance companies and bi-partisan legislators, hosting such open debates on CNN, never happened.

      The 2,500 page bill was not only unposted on the internet, it wasn't even read by the vast majority of legislators who voted for it, nor by the President who signed it. The only debates on the the contents of the bill were among the Democrats behind closed doors; Republicans were shut out of the process. Then came the backroom deals and the outright bribery and buying of votes, including the 2nd Louisianna Purchase of Mary Landrieu, the Cornhusker Kickback to Ben Nelson. Taxpayer money being used to bribe Senators to pass a bill that would cost taxpayers untold trillions more over ten years. The CBO was fed a list of phony parameters around which to base an estimated cost, not the least of which was the comparison of ten years of funding to six years of benefits. The unrealistic cost estimates provided to CBO by the Obama administration, based on hidden benefit cuts, stealing from Medicare funding and hidden projected tax increases, all resulted in totally unrealistic cost estimates. Many Democrats used this estimate and chose to believe that it would reduce the deficit as their excuse to vote for the health care reform bill.

      Now, that all has been said and done, the CBO bravely comes out with the prediction that Obamacare will actually increase the deficit. What political courage.

    14. Lloyd Scallan New Or says:

      Wow, what a surprise! Did anyone not know this was coming? Pelosi said it all.

      Now that we know "what's in it", the big question is does the American people

      have the guts to fight for their freedoms? We had all better understand we are in a fight for our nation. Obama and the Dems did not make all of those "deals' and

      paid all of those "bribes" to allow Obamacare overturned. This will be a fight to the death, either to death of our country or the death of the Democrat party.

    15. Drew Page, IL says:

      Now? Now, that this gigantic bundle of half-truths, deceptions and outright lies has been passed into law, the CBO comes out and says Obamacare will cost more than they said it would, that it will actually increase the deficit. What political courage.

      CBO was fed ridiculous parameters around which to create a cost estimate of Obamacare, so they did it. "Garbage in, garbage out", why didn't the CBO have the guts to issue this caveat when releasing the cost estimates they were told to provide by the Obama administration. Many Democrats used this nonsenical estimate and chose to believe that Obamacare would indeed reduce the deficit as their excuse to vote for it.

    16. Lloyd Scallan New Or says:

      Wow, what a surprise! Does anyone NOT know this was coming? Pelosi said it

      all. Now that we know "what's in it", the big quesiton is does the American people have the guts to fight for their freedoms. Obama and the Dems did not pay all of those "bribes" or make all of those "deals" to allow the American people to overturn Obamacare without a major fight to the death. Either the death of our nation as we know it, or the death of the Democrat party, thus the socialist

      movement now infecting this country.

    17. bigdave ocala fl says:

      Obamacare is the same as a POOL BUILDER promising you can fill your 100,000 gallon MAGIC pool with only 100 gallons of water…sign right here…you have no choice either because we are putting in the pool whether you want it or not. AND, you will get a bill for the water after the pool is filled, THEN you have TWO CHOICES…PAY IT OR GO TO JAIL!

    18. oudbob says:

      At age 65,and still working. I get a small part of my health ins. paid by my Co; but I pay the rest. I am afraid I will be forced off my insurance because of my age. The insurance group is for those under 65. As soon as I go on medicare, I will receive health care bills I can not afford. I will lose my house, etc. This has already happened to a friend of mine.

    19. Lynn, Austin says:

      Seems to me that since the unwilling public was lied to about the costs, especially since the CBO had presented Sebelius with new numbers but they didn't heed it lest it "skew the vote", this so called BS contract should be considered a fraud and thrown out, just like this administration.

    20. Carol Wilson says:

      Why am I not surprised??? Every time this administration moves it lips nothing but lies roll out!!!

    21. Michael Varnell Cent says:

      I do not have a comment, but rather a question. I received an email today saying that certain religious groups are excempt from Obamacare, i.e., Muslims and the Amish.

      I tried researching this with no luck. I always try and investigate anything I receive over the internet as a lot of the information is bogus. Can you shed some light on this.

      Thank you

    22. julie, Oregon says:

      I have just been forced to put myself on the top of the healthcare rationing list (that is I had to enter the Medicare program). Yesterday I received in the mail a pamphlet printed by the government telling me who Obamacare will make Medicare better.

      The lies not withstanding. This was printed on slick paper, colors and photos. The prize, of course, was one of Hussein himself signing it into law.

      If this plan is as great as the government says it is why all the propaganda?

    23. toledofan says:

      I think alot of this was known when the bill was passed but ignored by the House and Senate and especially the mainstream media. Even though the government run option was taken off the table, that will become a part of the bill, eventually, when most employers decide to pay the fine rather than the cost. Once that happens and prices start to skyrocket, the government will waltz in and take over. I still don't think we know all of the unintended consequences of this bill, but, we know, for sure, the cost will be at least double of what the estimates were.

    24. rosemarie douglass says:

      it is so sad that the country i adopted is going to the dog~s

      and to socialism, well it dos not take long for me to slip back in my old days , i grow up in a socialistic country,

      wy are the americans sooooooooooooo gulloble and so dense, the need to study there cinstitution of america , the know then how mutch power the have , i just like to cry ,

      AMERICA WAKE UP

      thank you Rosemarie Douglass

    25. Jim says:

      This is just the tip of the ice berg! This atrocity of a bill should be an outrage to all Americans! Its unsustainable in a country of 30 million people let alone 300 million people. Waiting lines,rationing,lack of doctors,huge tax increases,no money for continued research,incompetent physicians,etc,etc. We have to repeal this bill,NOW!

    26. Jim MN says:

      It's all about Nov-2 2010 now.

      If both houses of Congress do not change back to Republicans, you can kiss this good country goodby.

      I predict 2/3's of Dems that remain after the fall election will not run in 2012. out of fear for there lives.

      Obama will not serve out his full term. He and the Dem leadership will all be brought up for impeachment and be convicted if Repubs take over.

      That is, unless we are consumed by the upcoming WW3.

      It is scarey that 46% of those polled today still think the WH fool is doing a great job. See what 40 years of indoctrination has done to two generations of illiterates.

      Civil war cannot be far behind 2012.

    27. CS Stephenson says:

      REPEAL, REPEAL, REPEAL……

    28. Jim , Ohio says:

      TO: Ken Jarvis, You Are a Moron.!!!!!!!

    29. John McNeil; Bluffto says:

      It is very hard to leave moderate messages to the repeated 'truthing' (kind of like outing) of the obama administration reported here. Once again, Obama and his henchmen's manipulation of the system and budget numbers are purposeful lies designed to turn America into a socialist state. The american people can only blame themselves for the presence of this horrific president. Had enough yet? 2012 is not far away – this dangerous leader of the dark side must be defeated.

    30. S Rubicon, Southcent says:

      Ah yes. Here we all are today, "shocked, shocked" to learn the health care legislation, is a financial catastrophe and a functional disaster. It is true repeal is called for. It is true whoever is in Congress once repealed, had better come up with some terrific alternatives. We know there are solutions to what were the current problems. We know there are ways to deal with much of this. We also know, putting government in charge of this many decisions, is suicidal.

      While we go through all of this, we must also keep in mind that our old establishment mainstream media, left us down. In fact, they committed such an act of incompetence that if they do go broke, we should all cheer as they walk home unemployed. And I hate the idea of kicking someone when down.

      Folks, the message was out there. There were media outlets trying to tell the whole story. They were condemned. The administration used its 'bully pulpit' to portray anyone who spoke out in disagreement, as against them & the people. Many believe balanced reports are a bias against the goals of the administration. In short, this administration wants all of us to shut up & sit down while they supposedly clean up the mess. We are told everyone else caused the problems, as though this administration or its political party had no responsibility or capability to enact changes that could have averted some or most of this. Some in Congress said in the past that if Fannie & Freddie fail, the public will deal with it. Few realized this meant, taxpayers will have to foot the bill for bad economic & social policies that tried to give away more than we had to give away!

      Media changes are being proposed. The administration wants media to get government subsidies. Imagine how free, fair, and impartial media will be then? No, I say, if the public is not buying your print publications or not tuning into your radio or TV stations, its because your product is unacceptable. Perhaps if some media types stop sponsoring socialism they may get their subscribers back?

      Hold congress responsible for its failures. But also hold the media accountable for its pathetic performances. Had they told all of the truth or provided all of the information with an unbiased slant, even members of congress may have understood why the public was right when they rejected ObamaCare!

    31. TREVOR MERCHANT BRON says:

      I WILL BE BRIEF BY STATING THAT BARACK OBAMA HAS NEVER IMPRESSED ME FROM THE OUTSET ,HENCE THEREFORE NOTHING IS NEW AND OR STRANGE AS TO ALL OF THE DEVELOPTMENTS AND ISSUES THAT HAVE OCURRED SINCE HE TOOK OFFICE . THE MAIN STREAM MEDIA OF THE FOURTH ESTATE AND WALL STREET WERE AND ARE STILL THE TWO ROMINENT ENTITIES THAT ENABLE BARACK OBAMA TO BE PRESIDENT . WHEREBY THEY ARE EQUALL RESPONSIBLE FOR THE SINS THAT HE HAS AND CONTINES TO COMMIT. KNOWLEDGE IS POWER AND THE SHARING OF KNOWLEDGE TRUTHFULLY IS EMPOWERMENT TO QUOTE .UNQUOTE . THERE ARE SO MANY PEOPLE WHOM ARE WALKING AROUND WITH SMART PHONES AND OTHER MODERNISTIC MEANS YET STILL THEY ARE VOID OF THE KNOWLEGE IS POWER DOCTRINE . WHEREAS THEY ARE SOME OF THE ELEMENTS WHOM WERE RESPONSIBLE FOR THE BARACK OBAMA, ACENDENCY WHICH IS A DISASTER AND WILL INCREASE TREMENDOUSLY WITH TIME . I THANK YOU TREVOR MERCHANT BRONX NEW YORK CITY ,.WEDNESDAY JUNE ,02.2010

    32. Jesse Slome, Los Ang says:

      Listen, no one raise more questions about the CLASS Act than we did. And, yes, no one ever questioned how a program that starts in 2013 could record deficit-reducing income in 2011.

      But that said, CLASS is now law. And, we all need to see what we can do to make it effective. Failure to do so will result in millions of Americans turning to taxpayer-paid programs anyway. If CLASS succeeds fewer will. That's good news for those with CLASS coverage and better news for taxpayers.

      What we must do is make sure that CLASS is designed to provide a true benefit and that it is priced properly and so that working people can and will afford it. The success will be in the details. Of course, the long-term financial implications are also vital.

      There will always be a market for private long-term care insurance among those who can health qualify and those who understand the value of planning. Currently 8 million own this coverage. The market for this coverage should be twice that. Time to work together to make it happen … and happen right.

      Jesse Slome

      Executive Director

      American Association for Long-Term Care Insurance

      <a href rel="nofollow"> http://www.aaltci.org

    33. Blair, Franconia, NH says:

      Obamacare will be the WORST thing to happen to this country. Since when has the

      government ever run anything, except the military, efficiently?

    34. Blair, Franconia, NH says:

      Obamacare will be the worst thing for this country. Since when has the government

      run anything, except the military, efficiently?

    35. Blair, Franconia, NH says:

      Obamacare is the worst thing to happen to this country. Since when has the government run anything, except the military, efficiently?

    36. Craig Sacramento ca says:

      This bill must be repealed if we hope to salvage what is the best medical care system in the world. This bill is unconstitutional, unworkable and totally unpalatable to those who have any desire to manage our own affairs. Interesting to note that the Canadian system is now running out of money and is going to have to make serious changes. The healthcare in Great Britain is also a total dysfunctional and impossibly expensive mess. Perhaps if we can dump the Democrats in November, particularly in the house, we can at a minimum defund this monstrosity! Better yet it would be great if it is repealed in totality!

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    39. Kevin B., USA says:

      Excuse me, but the CBO is not singing a different tune. The analysis to which the CBO blog refers was published on March 20, before the law was passed. It's not a new analysis. It's been there for over two months.

      To claim that the CBO is now singing a different tune is deceptive at best.

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    42. Gary PV says:

      Heritage is not my Heritage- I am a true Anerican- not a self-seeking front for the root cause of all that IS wrong.

    43. gorio, calif. says:

      I don't think the "healthcare" bill was intended to "solve" anything, rather it was intended to "condition" the public into accepting government dominance over personal decisions. The progressives that passed this actually believe that the public are mentally/morally incompetent to decide the major life decisions and therefore it is their "right" and "duty" to intervene. This is the heart of the progressive ideology and is very similar to the national socialists of nazi fame in

      scope and morality. Dr. Berwick our new administrator for medicare/medicaid says "The decision is not whether we will ration care, the decision is whether we will ration with our eyes open".We still have the vote and our 2nd amendment, there is no way the brownshirts can prosper, and there is no reason to give the life and death rationing decisions to Dr. Berwick as long as we still have a brain

      our constitution demands that we use it to decide for ourselves as an example for future generations.

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    47. Brian, Florida says:

      As a demonstration of the fight against "socialism" we need to refuse to cash our "socialist security checks" any assistance from the government is socialism isn't it? Especially if it isn't financially sound.

      Socialist Security is welfare for old people who refuse to work and only want to lay about and complain.

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    49. Billie says:

      Brian what a BRAT you are! social security was a GOVERNMENT plan that the people living on social security now, were forced to trust, while they paid into government social security plan throughout their employed lives. The intent was the understanding: government would aid the elderly when they become elderly and unable to work.

      it was GOVERNMENT that diverted the money and GOVERNMENT handing it out to people that NEVER PAID A DIME! And you don't think that is worth complaining about? It was a guaranteed insurance plan run by GOVERNMENT!

      Brian, if your mind is unable to comprehend the words written, you're a victim of social brainwashing. Help yourself and open your mind.

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