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To: All Americans - From: The U.S. Senate

For many Americans Christmas morning is a time of great anticipation, where the giddy excitement of our youth is remembered and sometimes still experienced. I came sprinting down the stairs on this Christmas morning with thoughts of family, gift-giving, and good times on my mind, only to discover a proverbial lump of coal in my political stocking. We all must have been naughty this year because our Senate rewarded us with a Christmas Eve vote (the first since 1895) to pass their version of a health care reform bill. This means that both the House and Senate have now passed versions of a health care bill that now must only be reconciled together, and eventually signed by President Obama. You may think that health care reform sounds like a pretty good gift to the American people, and under the right circumstances I would agree with you, but let’s look at what we’ve really unwrapped this Christmas morning.

I first urge all of you to read this article from U.S. News and World Report about the factual things that this new Senate bill would change, I feel it is unbiased and informative. I’m going to apply as much common sense to the key items as possible, so that we can get a really clear picture of the present we’ve been given.

Item #1: Required Coverage. Americans would be required to purchase health insurance from private companies or pay a fine. The fine would be $750 or 2% of household income (whichever is greater) per person, or $2250/2% (whichever is greater) for families. Required coverage = Your government forcing you to buy a specific product from a private company, which is an utter abomination of the free market system, a disturbing mingling of public and private interests, as well as a violation of your individual liberty.

Item #2: Employer Obligation. All companies with more than 50 employees would be required to provide health insurance or pay a $750 per year fine per employee. Employers of more than 200 would be required to enroll their employees in health insurance without the consent of the employee. Employer obligation = Additional burden to businesses that are already struggling in the current economy. This provision also discourages job-creation, as it adds more cost per employee, and discourages small businesses from growing beyond 50 employees, as they would then incur significant cost increases. Reducing costs to businesses of all sizes is the only thing that will help them grow, thus allowing for more tax revenue, more jobs, and an overall positive effect on the economy. The rules of “employer obligation” as put forth in this bill do the opposite of that.

Item#3: Government Subsidies (the next 4 items are all related, and lead to item#7). The government will help anyone who earns 400% of the poverty level or lower (approx. $43,320 for individuals or $88,200 for families) to pay for their health insurance. Government subsidies = Higher costs for the American taxpayer in one way or another (where is the money going to come from?).

Item #4: Medicaid Expansion. Individuals or families would now be eligible for Medicaid if they earned 133% of the poverty level or lower. Medicaid Expansion = Higher costs for the American taxpayer in one way or another (where is the money going to come from?).

Item #5: Insurance for high-risk patients. Insurance companies would now be unable to refuse individuals with pre-existing medical conditions or charge them substantially higher rates. In fact, under a new “national high-risk pool” their rates would be comparable to those of the average healthy citizen. Insurance for high-risk patients can only be paid for in one of two ways. Either the government subsidizes the “high-risk pool” with taxpayer dollars, or the insurance companies will have to charge higher premiums to the rest of us to compensate for the added cost. In both cases it adds higher costs to the American taxpayer yet again, and could even hurt small businesses further with higher premiums on healthy employees.

Item #6: Lifetime Limits. Insurance companies would not be allowed to cap the amount of lifetime benefits of any one person or cancel coverage on anyone, unless fraud is committed. Lifetime limits = Higher insurance premiums for the average person yet again, as well as businesses who cover their employees, as the insurance companies have to find a way to spread the cost of this new law around.

Item #7: New Taxes (Items 3-6 have to be funded by something, so get ready for this). Many long-standing tax credits and deductions would decline. Taxes on some benefits will increase. The House bill (which we haven’t discussed here) would add an additional 5.4% tax to individuals earning $500,000 per year or families earning $1,000,000 per year or more. The senate bill even adds a new 10% tax on the cost of indoor tanning services. New Taxes = More economic stagnation or decline.

So in review, the Senate would like the average American citizen to lose current tax credits and deductions, have an increased tax on their benefits, buy health insurance or incur a fine, and even tax their tanning habits in order to cover subsidies, expanded Medicaid, and possibly high-risk patients. It would also like every American business (with over 50 employees) to pay for employees health benefits (or pay fines). If you haven’t had time to swallow that gulp yet, you’ll still get an increase in your insurance premiums to help the insurance companies cover the cost of new patients with pre-existing conditions that they’re being forced to take on, and the new ban lifetime coverage limits (businesses would incur similar premium increases). All of these new costs will be generously added to you and businesses around the country during this current recession, which I’m sure will help stifle any economic growth we’ve been able to achieve. I haven’t even brought up the increased financial burden being thrust on the state governments by this bill, which will probably lead to increased state taxes of some kind (income taxes, sales taxes, tolls, etc.), as it is the holidays and I don’t wish to depress anyone. So if that’s the gift of health care reform you’ve been waiting for, I say “Merry Christmas, you got it!”. For the rest of us, don’t blame Santa, I have a feeling he doesn’t want any of the credit for this Yuletide treasure.

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