April 29, 2010


By Idaho Senator Mike Crapo

In an editorial last week, the Wall Street Journal wrote, "When President Obama signed his health-care reform last month, he declared it will 'lower costs for families and for businesses and for the federal government.' So why, barely a month later, are Democrats scrambling to pass a new bill that would impose price controls on insurance?" The answer is that the supporters of the new health care law knew, as did the majority of Americans who opposed the law, that it would ultimately increase costs for families, businesses and the federal government. This new legislation will only extend government control over prices and the private health care decisions of individuals and businesses.

Last week, more evidence came out to prove that the new health care law will not lower health care costs as promised, but will increase them. The Chief Actuary of the Centers for Medicare and Medicaid Services (CMS) reported last week that we will spend $310 billion more as a nation, with health care spending going from 17 percent of gross domestic product (GDP) to 21 percent. As the Wall Street Journal notes, current overall health care spending is projected to be $4.7 trillion in 2019 and the CMS report estimates that it will be even higher with a one percent increase each year until then. The CMS report also predicts that, due to the increased demand and extended coverage required by the new law, it is "plausible and even probable" that we will see health care shortages and price increases, which means many people will be unable to access care.

Seniors are at risk of losing access to care due to massive reductions in Medicare payments to providers and cuts to Medicare Advantage. The CMS report estimates that about 15 percent of Medicare Part B providers could go out of business within ten years and that Medicare Advantage enrollment will be reduced by 50 percent as a result of the cuts to the program. The report also estimates that 14 million employees will lose employer-sponsored coverage because of the new law and the percentage of insured workers who will be affected by the "Cadillac tax" will be 12 percent initially and rise "rapidly thereafter."

The Wall Street Journal also stated that benefits such as "expanding family coverage for children as old as 26 and banning consumer co-payments for preventive care" are not free "and their cost will be built into premiums." The CMS report states that new taxes on insurance plans, drugs and medical devices will be passed on to consumers "in the form of higher drug and device prices and higher insurance premiums." Lastly, a new report from the nonpartisan Congressional Budget Office projects that four million people will be penalized for not carrying insurance and that those penalties, enforced by the Internal Revenue Service, will affect mostly people making under $59,000 a year, thereby breaking the President's pledge that there will be no new tax increases for families making less than $250,000.

When arguing in support of a government takeover of health care, some highlighted stories of unaffordable coverage and a lack of access to care for many Americans. But we now know that this law will not fix these problems; instead, it will make many of them worse. We must repeal this legislation before its many negative effects hit Idaho families and businesses, and we must replace it with common-sense reforms that lower costs and increase the quality of and access to care. For more on health care, please go to http://crapo.senate.gov, and to read the CMS report, you can  click here (PDF). 

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