Obamacare will impact jobs and our economy in negative ways. The Congressional Budget Office (CBO) report, recently released, shows just how much it will impact. No matter the economic viewpoint held, it becomes clear that this legislation will devastate the American family and our economy. Whether one believes that economic growth spurs from consumers keeping money in their pockets or lower spending of the government, both are losers in this case.
Furthermore, the CBO report only looks at the impact of Obamacare on the budget. It does not account for shortfalls or further reaching effects on our budgeting and economic outlook. In other words, it does not weigh the impact on our already failing systems of Medicare, Disability or any of the Social Security programs that already struggle. The biggest of these impacts is Medicare.
Medicare Impact and Result
Medicare enrollment is projected to increase from 34 Million (pre-ACA) to 47 Million by 2023. This represents a 38% increase in enrollment. This increase represents a cost of $710,000,000,000 over this same period, if funded by increased taxes. As of 2013, Medicare (HI) was projected to be depleted by 2026. It is unclear whether or not the increase in Medicare enrollment was accounted in the Trustee's Annual Report of 2013. However, it is clear that the Trustee's use a baseline of the current year for their calculations. With the increases in Medicare enrollee's hitting hardest in 2014, it is likely we will see ugly numbers come 2015.| OASI | DI | OASDI | HI | |
|---|---|---|---|---|
| Year of peak trust fund ratioa | 2011 | 2003 | 2008 | 2003 |
| First year outgo exceeds income excluding interestb | 2010 | 2005 | 2010 | 2018 |
| First year outgo exceeds income including interestb | 2022 | 2009 | 2021 | 2021 |
| Year trust funds are depleted | 2035 | 2016 | 2033 | 2026 |
Employer Based Insurance
11,000,000 people will lose their employer based insurance by 2019, according to the CBO. However, it is believed that 4,000,000 of these individuals will obtain coverage through the exchanges. By 2023, the average subsidy will reach $7,900 per individual.
What happens to the other 7 Million people who will lose their employer based insurance? It is believed that these people will fall into one of two categories; Medicare or uninsured.
The Net Effects
The CBO report offers more insight into what they believe will be occurring over the next few years. The net effects are hard to predict, due to the size and scope of this legislation. Throughout the report, assumptions are made in order to measure the effects in a statistical analysis.
- It is projected that the non-elderly uninsured will decrease from 55,000,000 to 31,000,000 by 2016. This still leaves a lot of people uninsured, which was the point of this legislation. According to the report, only 2-3% of these individuals are illegal immigrants. One finds it hard to believe there are only this many illegal immigrants, or we can conclude that they are being covered by Obamacare.
- Costs will grow astronomically from 2014 through 2023. While the total impact on the deficit is $49,000,000,000 in 2014, it grows to $170,000,000,000 by 2023. This is in addition to our already burdensome $17,500,000,000,000 deficit we currently have at this time.
- Costs extend beyond the deficit; they also impact individuals and families. All spending is taxation, and therefore, the true impact of the legislation can also be measured in the total cost on Americans. Table 2 shows more than the impact on the deficit, it also measures the overall net effect on Americans. In order to do this, we must add the gross cost of the coverage, plus all the taxes and penalties incurred on the people, directly and indirectly. By 2023, (assuming our population grows to 320 Million) the cost to Americans will be $520,000,000,000 per year or $1,625 per individual per year! This means, the average family of 4 will be impacted with an additional tax bill of $6,500 per year. Keep in mind, this is Obamacare only; it does not include the other spending we are currently doing as a country.
If individuals (320 million of them) have $1,625 less to spend each year, is it not hard to believe that our economy will tank? If the government spends more than it takes in already, then we add an additional $1.4 Trillion over the next 10 years, won't it paralyze us?
Furthermore, we still do not know the net impact of health care costs on individuals and families under this plan. Both sides continue to cherry pick stories of horror and success, but what is the net effect? It is not surprising that there are winners and losers under this legislation; that is how government intervention works. This net effect on premiums, etc. will not be known until the law is fully implemented, which is a moving target.
As is widely known, this legislation is political in nature. Is it any wonder that the implementation was initially scheduled for 2014 (before mid term elections), but has now been delayed for its' highest impact in 2016? And, as shown by the information passed along by the CBO, the strongest impact is the implementation of the employer mandate. This has been repeatedly delayed and is now slated for 2015.
