Why ObamaCare is Wrong For America: How the New Health Care Law Drives Up Costs, Puts Government in Charge of Your Decisions, and Threatens Your Constitutional Rights, by Grace-Marie Turner, James C. Capretta, Thomas P. Miller, and Robert E. Moffit. Broadside Books, 2011. 259 pp. $14.99 (paperback).
Turn back the clock for a moment to the months leading up to the March 2010 enactment of the Patient Protection and Affordable Care Act, also known as ObamaCare. What do you remember about the president’s pitch for health care reform?
You may recall the administration’s claim that ObamaCare will expand health insurance coverage to 32 million Americans, guaranteeing that nearly all Americans will be covered. You may recall the claim that the new program will reduce waste and overhead, and save the typical American family $2,500 per year. And who could forget Obama’s personal promise, delivered time and again: “If you like your doctor, you will be able to keep your doctor. Period. If you like your health care plan, you will be able to keep your health care plan. Period. No one will take it away. No matter what.”1
With this and other rhetoric, the president and other supporters of this Act were able to push the program through Congress on a partisan vote despite low popular appeal and indeed amid public furor. But although the bill has been signed, history has yet to be written. Within the more than two thousand pages of legislation are countless provisions and authorizations for additional regulatory changes to be rolled out in the years to come. Thus Americans are left wondering what exactly will change, when it will change, and how. For everyone, the question remains: What does ObamaCare mean for me?
Why ObamaCare is Wrong for America summarizes the key provisions of the new law, explaining how this historic piece of legislation fails to achieve the goals so loudly trumpeted by its proponents, and what it will actually do instead.
The authors—four health policy experts from four different conservative public policy organizations—largely succeed in making a complex topic comprehensible to a general audience. For starters, they organize their analysis of the legislation into reader-friendly themes such as “Impact on Families and Young Adults,” “Impact on Seniors,” and “Impact on You and Your Employer.” The subsection headings are descriptive and frequent, dividing the chapters into easily digestible segments, many of which are less than a page in length.
In the overview and the first chapter, “Impact on Families and Young Adults,” we learn that the architects of ObamaCare seek to achieve “universal coverage” not by means of market-based reforms—such as deregulating the insurance industry to open it up to interstate competition or equalizing the tax treatment of coverage purchased in the individual market—but by expanding coverage via two new federal entitlement programs: one to provide taxpayer-subsidized health insurance to low-income families and another to provide long-term health care benefits to seniors and people who are disabled (p. 21).
The first entitlement is for those who are unemployed, self-employed, or otherwise do not receive coverage through their employer, and who make less than four times the federal poverty level. A family of four may have a household income of up to $88,200 and still qualify. The formula for figuring the exact subsidy amount is complicated, and the exhaustive details are not listed in the book, but, in essence, recipients will “shop” for health insurance in one of the new state “health exchanges” and receive a subsidy on a sliding scale such that they pay no more than 10 percent of their household income. Those at the lower end of the income spectrum will bypass the exchanges and be ushered into the newly expanded Medicaid program.
The second entitlement, called the Community Living Assistance Services and Supports (CLASS) Act, will allow workers to buy insurance from the government to cover the costs of long-term care. After paying premiums for at least five years, workers are then eligible for benefits if they become disabled due to chronic illness or crippling injury. Here the authors of Why ObamaCare is Wrong for America offer a practical warning to readers: If your employer participates in this federal program, then you will be enrolled automatically and a monthly premium will be deducted from your paycheck (p. 30). If you do not wish to participate, you must take the initiative to opt out.
The authors note that whereas these programs will cost more than $2.3 trillion over the next ten years, 23 million people will remain uninsured (p. 57). Thus, although the government will spend far more money, it will not come close to meeting the administration’s dream of “universal coverage.”
The president promised that his plan would lower health insurance premiums for American families, but, the authors note, “his plan won’t reduce health costs for American families. In fact, costs already are increasing because of early ‘benefits’ in ObamaCare, and they will soar once the full overhaul law takes effect” (p. 46). Estimates of the effect of new entitlements on health care costs were available throughout the health care debate of late 2009 and early 2010, but were largely ignored by Congress. Experts at the Congressional Budget Office (CBO) now predict that Americans who buy individual insurance will pay at least an additional $2,100 annually as a direct result of reform. “In addition, CBO says that if you own or work for a small business that provides health insurance, you can expect the coverage to cost $19,200 a year for a family by 2016. And remember, buying insurance isn’t optional. You must buy a policy or face federal fines and penalties” (p. 47).
Perhaps the best-known promise—really a backpedaling reassurance—the president and his allies made was that under ObamaCare Americans would be able to keep their doctors and their health plans if they so chose. The authors refute this, too.
ObamaCare thwarts existing doctor-patient relationships, they explain, by drastically changing the rules of the game for employers, insurers, and doctors. Faced with new pay-or-play provisions (requiring employers to pay a penalty or provide health coverage that meets a minimum government standard), many employers will switch to cheaper plans or drop their coverage altogether. The latter move could affect as many as 35 million workers (p. 213). Similarly, faced with new minimum requirements for medical loss ratios, “Some health insurers have stopped health insurance altogether, forcing policyholders to find new plans and doctors” (p. 107). The authors report that one insurance company in Iowa has already bowed out, leaving 840,000 Midwesterners to find new coverage (p. 51)—and that over the next ten years cutbacks in the quasi-private Medicare Advantage plan will “nudge” as many as 7.4 million seniors back into traditional Medicare, which will require many of those individuals to change doctors.
The authors also explain that, in response to government changes in reimbursement rates, many physicians will limit the number of Medicare and Medicaid patients they see, drop out of the programs, or leave medicine altogether. All told, as many as 80 to 100 million people could see their coverage and/or their physician network change as a result of ObamaCare (p. 214). Similarly, say the authors, bright would-be medical students witnessing the deterioration in pay, job satisfaction, and professional autonomy in the field will opt for other careers (p. 108). These and other observations made by the authors clarify another major flaw in the “logic” of ObamaCare: Despite the president’s promise, patients cannot “keep” doctors who are no longer willing to practice, and medicine cannot thrive when the best and brightest flee the field.
The foregoing are just a few of the many reasons the authors offer as to why ObamaCare is wrong for America. Further reasons include the fact that various provisions in the law will, among other things, adversely affect small business owners, restrict options for people who wish to buy child-only policies, and raise the Medicare payroll tax for couples who earn more than $250,000 per year.
Toward the end of the book, the authors devote a full chapter to explaining the ongoing constitutional challenge to the individual mandate, which is the mechanism by which the law requires almost all Americans to purchase government-approved health insurance or pay a penalty of up to 2.5 percent of their incomes. The authors argue that the individual mandate, perhaps more than any other feature of ObamaCare, is indicative of a wider plan “designed to increase the dependence of citizens on political decision makers in Washington” (p. 161). Under this mandate, Americans will increasingly be paralyzed by unelected and unaccountable regulators acting through agencies such as the Centers for Medicare and Medicaid Services (CMS) and the Department of Health and Human Services (HHS). “When citizens and companies are not begging for waivers and special deals, they will be waiting to receive further instructions” (p. 161). The authors note that the constitutionality of the individual mandate is still being debated, and likely will not be determined by the U.S. Supreme Court until sometime in 2012. Attorneys general from more than half of the states are challenging ObamaCare in court, and voters in some states such as Arizona and Oklahoma have approved amendments to their state constitutions designed to protect themselves from ObamaCare and preserve the right of residents to provide for their own care (pp. 173–186). (Despite these challenges, however, most states are still proceeding with at least minimum preparations so as not to fall behind in implementing what is required of them under reform and risk being penalized by the federal government.)2
In general, the authors of Why ObamaCare is Wrong for America do a good job of condensing and critiquing the massive, detail-laden legislation. Although they approach the law head-on and are unabashedly critical, they refrain from hyperbole. For example, in the section titled bluntly “Are There Death Panels In ObamaCare?” (to which they answer “no”), the authors explain how the controversy arose and what protections are in place to prevent the emergence of death panels—and then acknowledge the legitimate basis for concern over this issue, which is the conflict of interest introduced when the federal government makes decisions about coverage while simultaneously trying to control program costs (p. 92).
Unfortunately, although the authors ably elucidate the problems with ObamaCare, they do not argue effectively for genuine free-market reforms. This is most evident in the discussions of Medicare, which appear in several places throughout the book. Although the authors say they want a “market-driven health care economy that puts consumers in charge of choices” (p. 191)—and although they acknowledge that Medicare is more than $30 trillion under water, that it is rapidly sinking deeper, and that its rules and payment schedules distort every aspect of the medical industry—they nevertheless write that “Medicare is an indispensable part of American health care” and that the right path for America is not only to save Medicare for today’s beneficiaries, but also to make it “safe and solvent” for future retirees (p. 61). The authors rightly object to ObamaCare’s new Accountable Care Organization (ACO) payment model, which institutes a form of managed care; and ObamaCare’s new Independent Payment Advisory Board (IPAB), which establishes a group of fifteen experts to recommend changes in payment rates so that the government can stay within an annual spending cap for Medicare. But because they fail to oppose the principle on which the government-provided safety net rests—namely, the notion that Americans morally must sacrifice for the needy—the authors are unable to advocate a genuine free market in medicine.
Even so, Why ObamaCare is Wrong for America substantially does what it sets out to do: It shows why ObamaCare is economically and medically bad for America, and these are important, if not fundamental, aspects of the argument against this atrocity.