Posted on 04/21/2014 9:52:52 AM PDT by kabar
Earlier this month there was tremendous press attention to new data indicating that enrollment in the Affordable Care Act (ACA)’s health insurance exchanges had surpassed 7 million. The White House took a victory lap while much of the press, desperate to write something positive after months of reporting on website glitches and insurance plan cancellations, characterized the milestone as good political news for ACA supporters. Our national discussion, however, is missing the truly significant story here; what is unfolding before our eyes is a colossal fiscal disaster, poised to haunt legislators and taxpayers for decades to come.
It is quite possible that the ACA is shaping up as the greatest act of fiscal irresponsibility ever committed by federal legislators. Nothing immediately comes to mind as comparable to it. Certainly no tax legislation is, because tax rates rise and fall frequently, such that one Congress’s tax cut can be (and often is) undone by a later tax increase. The same is true for legislation affecting appropriated spending programs. But the ACA is a commitment to permanently subsidize comprehensive health insurance for millions who could not otherwise afford it, which the federal government has no viable plan to finance.
CBO now estimates that the gross costs of the ACA’s coverage expansion will be $92 billion in FY2015, or about 0.5% of our total GDP of roughly $18 trillion. This far exceeds, even relative to today’s larger economy, the initial costs associated with the entirety of Social Security and Medicaid, and is comparable to the startup costs for all original parts of Medicare combined. Consider this: just five years after enactment the ACA will absorb more of our total economic output than Social Security did fully sixteen years after it was enacted.
(Excerpt) Read more at mercatus.org ...
We must stop using enrollment and the numbers of those paying premiums as the metrics for evaluating the success of Obamacare. The numbers will inevitably go up as businesses drop coverage and force employees on to the exchanges. The incentives are there, i.e., it is cheaper to pay the penalties than the costs of employee health care insurance.
In order to maintain their revenue-neutral status, six years from now ObamaCare will have to be suspended for four years to allow tax revenues to catch up again.
Mercatus has done wonderful work on healthcare policy. They’ve been ringing alarm bells about ACA from the very beginning.
If there's still any justice in this nation, the Obamas, the Democrats who voted for this POS and all of the Republican cowards who refused to fight it will be dragged in front of a jury of the people it impoverished and sent up river to serve lifetime sentences.
How wonderful that our discussions here on FR haven't missed a thing.
IMHO, all this noise about "signups", "enrollments", etc. will settle down once the actuaries begin to balance income versus expenses.
The death spiral is coming. Just be patient (no pun intended :)
The info will NEVER see the light of day in the MSM.
If you read the article, that is thoroughly debunked. The revenue is never going to catch up. And Obama and the politicians are delaying or stopping revenue raising measures that are politically painful, e.g., delaying the cuts to Medicare Advantage.
Medicare costs more than nine times the original estimates. Obamacare is another entitlement program that will just add to the bankruptcy of this country like Medicare, SS, and Medicaid. We can't afford them.
Obamacare was never revenue neutral.
What is truly amazing is that the author is one of the two public members of the SS and Medicare Trustee Board. He is intimately familiar with the issues and has an influence on public policy.
This is incredibly sad.
There will be no death spiral, just more taxes and the redistribution of wealth to keep it going. Obamacare is too big to fail. It will be just like SS and Medicare, which have an unfunded liability of over $60 trillion over the next 75 years.
Nuke socialized medicine and replace it with the free market, stopping the mouths of the Left that say we don’t have an alternative to Obamakill. When the Lefts say the free market doesn’t work, reply that the free market made America the wealthiest and healthiest nation on earth until the 70’s when GOVERNMENT started interfering with healthcare. GOVERNMENT is the reason for healthcare cost problems and MORE government is the ticket to societal, financial, and health disaster.
Do you think there is the political will to get rid of Medicare and Medicaid, two single payer programs that cover more than 120 million Americans?
No economy can bear pressure as is being applied to our's indefinitely.
No doubt, but it is still a ways off. America is a rich country. A few months ago Mark Steyn wrote a column about America's addiction to the welfare state. Americans just don't want to pay the taxes to support it. As Mark put it, if they want a Norwegian style welfare state, they must be willing to pay Norwegian levels of taxation.
CLASS: The ACA’s “CLASS” long-term care provisions were originally projected to generate $37 billion in net premiums through 2015 ($86 billion over ten years). CLASS was later suspended due to its long-term financial unworkability, meaning these revenues have not materialized and will not.
Employer/individual mandate penalties: These were supposed to have brought in $12 billion through 2015, $101 billion over the first ten years. Because the Obama Administration has repeatedly delayed their enforcement, to date they haven’t brought in much of anything. Some ACA advocates are even beginning to downplay the significance of possibly ditching these mandates altogether, though they were central to the law’s financing scheme.
Medicare Advantage: The ACA was supposed to be financed in part by cuts to Medicare Advantage (MA) totaling $31 billion through FY2015, $128 billion over the first ten years. The White House recently announced that planned MA cuts will not go into effect after all.
Other controversial provisions: The ACA’s most controversial savings provisions – among them its ambitious Medicare provider payment reductions, the tax on so-called “Cadillac” health plans, and cost-saving decisions of the Independent Payment Advisory Board– have yet to be tested. Given that less-controversial provisions have failed to meet their savings targets, there is little basis for confidence that these more controversial ones will do so.
I agree with everything said. I was simply reminding everyone of the lie told in the beginning along with its complimentary logical fallacy.
Mark should have picked another example - according to Wiki the top rate is Norway is 8% lower than the combined fed/state/local top rate in the US.
-— There has got to be a catastrophic collapse at some point. -—
Well, it could also be a slow and devastating collapse.
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