e-News October 26, 2010


It has been seven months since President Obama signed the job-killing government takeover of health care into law, and since that time the devastating consequences of Obamacare have continued to buffet American families and small businesses. 

And now, one month after the first major wave of the law’s rules and mandates have begun to take effect, the already-substantial list of broken Obamacare promises has gotten even longer.

The following seven consequences of Obamacare are already beginning to raise costs, jeopardize coverage and make it harder to create jobs:

1.    Encouraging Employers to Drop Coverage, Raising Costs for Government.   According to a Wall Street Journal op-ed penned by Governor Philip Bredesen (D-TN), “our recent health reform has created a situation where there are strong economic incentives for employers to drop health coverage altogether. The consequence will be to drive many more people than projected—and with them, much greater cost—into the reform’s federally subsidized system…Because of the magnitude of the new subsidies created by Congress, the economics become compelling for many employers to simply drop coverage and help their employees obtain replacement coverage through an exchange.”

Related Reading: Governor Philip Bredesen (D-TN) writing in the Wall Street Journal, “Obamacare's Incentive to Drop Insurance. My state of Tennessee could reduce costs by over $146 million using the legislated mechanics of health reform to transfer coverage to the federal government.”

2.    Eliminating Coverage for Children.  Earlier this year, major insurers, faced with an unprofitable business, stopped issuing new child-only policies.  The difficulty in preserving access to child-only insurance policies is the latest example of unintended consequences of the new law, the Patient Protection and Affordable Care Act. The collapse of the child-only market is a preview of what will happen when the rest of Obamacare comes on line in 2014 for adults, except then insurers will have nowhere to flee.

3.    Increasing Health Care Costs, Not Reducing Them.  Health insurers say they plan to raise premiums for some Americans as a direct result of the health overhaul in coming weeks, complicating the President’s efforts to trumpet their signature achievement before the midterm elections.  Aetna, some BlueCross BlueShield plans and other smaller carriers have asked for premium increases of between 1% and 9% to pay for extra benefits required under the law, according to filings with state regulators. U.S. health spending is projected to rise 9.2% in 2014, up from the 6.6% projected before the law took effect. New mechanisms kick in that year to expand insurance coverage.

4.    Preventing Small Businesses from Hiring New Workers.Some business owners in New Jersey say they’re holding back on creating new jobs because they’re unsure if the newly added provisions in Obamacare will increase their health premiums or those of their customers.

5.    Raising Costs for Workers.In a letter mailed to employees late last week, Boeing cited the overhaul as part of the reason it is asking some 90,000 nonunion workers to pay significantly more for their health plan next year. A new study by accounting firm PricewaterhouseCoopers found that nearly half (47 percent) of executives surveyed expect the new healthcare law to have a ‘notable financial impact on their businesses.’

Related Reading:Peter Sanders writes in the October 12 Wall Street Journal, “Responding to what it says are rapidly rising costs, including some as a result of the new health-care bill, Boeing Co. plans to increase the price of employee health insurance for its non-union workforce over the next few years.”

6.    Shutting Out Retirees. 3M Company confirmed it would eventually stop offering its health-insurance plan to retirees, citing the federal health overhaul as a factor.  The Minnesota manufacturing conglomerate notified employees last Friday that it would change retiree benefits both for those who are too young to qualify for Medicare and for those who qualify for the Medicare program.

7.    Jeopardizing Coverage for Part-Time and Low-Wage Workers. McDonald’s and 29 other companies that provide very limited health insurance benefits to nearly 1 million workers have been granted one-year waivers by the federal government from a health-reform law provision.  The waivers were granted because the companies contended that to meet the requirement they would have had to raise premiums 200 percent on average. Some had said they would drop the benefit altogether.

Related Reading: Last Wednesday’s Wall Street Journal editorial, “Obama Care for some, Step right up and get your waiver.

The Solution

Rodney has stated many times that he “supports health care reform, just not the Obama-Pelosi version of health care reform.” 

Specifically, he advocates repealing Obamacare and replacing it with real reforms, including: enacting medical liability reform; granting consumers the freedom to purchase coverage across state lines; expanding Health Savings Accounts; strengthening the doctor-patient relationship, and ensuring access for those with pre-existing conditions.

“Until this happens the American people will have to deal with the devastating impact Obamacare is having on U.S. workers and their employers,” said Rodney.

Related Reading: Paul Boudreau, President of the Morris County Chamber of Commerce, writing in the Monday Daily Record, “Haunted by health care reform."