Michael Tanner, senior fellow at the Cato Institute and author of Bad Medicine: A Guide to the Real Costs and Consequences of the New Health Care Law, talked about Obamacare’s budgetary gimmicks and unsustainable costs at a recent panel discussion at The Heritage Foundation.
Tanner explained how one of the biggest gimmicks in the law is double-counted savings in Medicare. The cuts are unlikely to be fully enacted in the first place because of the impact they would have on seniors’ access to providers. In addition, the approximate $500 billion estimated in savings are counted toward paying for new spending in Obamacare. But as most Americans know, you can’t spend the same dollar twice.
Tanner also highlighted the CLASS Act, the government-run long-term care program currently on its way to repeal, which was used to help make the law look like it would reduce federal deficits. Tanner describes the CLASS program as a Ponzi scheme that would take in premium revenues for five years without paying out benefits, creating the illusion of savings. Tanner stresses in his book, “The CLASS Act may represent one of the health care legislation’s biggest fiscal time bombs.”
In his book, Tanner also talks about the ever-increasing costs of Obamacare’s exchanges.
The Congressional Budget Office predicts, “About 8 million people will receive exchange subsidies in 2014 and roughly 20 million will receive them by 2022.” Tanner reminded everyone that the country is broke: “We don’t have a couple trillion laying around to pay for this very costly and dangerous program.”
Tanner’s book further explains Obamacare’s flaws:
- It will cost an estimated $2.7 trillion over the first 10 years of its complete implementation and will add more than $823 billion to the national debt;
- Insurers will be able to evade the requirement to provide coverage to those with preexisting conditions;
- By 2019, roughly 21 million Americans will still be uninsured;
- It will massively expand the welfare state by forcing Medicaid expansion on the states;
- It will burden businesses with its mandates and regulations, making it difficult to hire new employees;
- It jeopardizes the future of health savings accounts and consumer-oriented health care as we know it;
- It does little to address increasing insurance costs, as premiums are actually expected to rise as a result of Obamacare.
As illustrated by Tanner in his book and at Heritage’s panel, Obamacare is damaging policy for the health care system and the nation’s fiscal future. As he said, “We need to repeal this simply as a matter of fiscal sanity.”
To listen to the entire event, click here.