A Look at Obamacare by the Numbers

Critics of the President's health care agenda are always looking for the "right words" to convince others about the danger that will come with Obama's radical agenda. Maybe the most effective rebuttal is not in words, but in numbers. It is through reviewing the impact, in numbers, that Americans for Tax Reform (ATR) is tackling this sweeping and far reaching legislation.

One of the major promises of the Obama campaign during his run for President was to show "restraint" when it came to taxes. No one making less than $250,000 would see an increase at all, we were told. The vast majority who made more than that would see very few tax increases of their own, we were assured. According to ATR, the number of new tax increases in the health care bill is 19.

I guess it would not be too bad, if you felt campaign promises (and not the Constitution) is all that mattered and all of these tax increases were directed towards the "super rich" who make more than $250,000. Unfortunately, the number of tax increases that "unquestionably violate President Obama's 'firm pledge' not to raise 'any form' of taxes on families making less than $250,000" is a significant number at 7. In fact, people making as little as five digits a year will find themselves subject to new tax increases.

The number of new taxes is disconcerting and the disregard to promises made by the President in getting elected is enough to make a person's blood boil, but the amount that will be collected through the health care bill is enough to strike fear in even the most liberal tax lover. According to Americans for Tax Reform, "the tax increase over the first decade if the health care bill becomes law" will be "$497 billion."

Two of the weaker countries in the industrialized world -- when it comes to jobs, GDP growth, and other indicators of economic expansion -- are Japan and the United States. They also have the highest top tax rates. This is no coincidence, but the natural consequence of excessively taxing those who create jobs. Number one has been Japan, but when Obamacare becomes law, we will have the dubious distinction of being the "leader" in high tax rates. According to Americans for Tax Reform, "the top federal tax rate on wages and self-employment earnings under this bill: 43.4%" This will translate into an "annual tax hike for every man, woman, and child in America" of $165.

Oddly, Obama's health care bill even takes damaging aim against those who are least able to defend themselves. According to Americans for Tax Reform, "the most parents of special-needs kids" will be able to "save tax-free for tuition in FSAs (currently, the amount is unlimited): $2500."

ATR does not discuss the rationing that will come with this sweeping move towards socializing medicine or the negative impact it will have on innovation, since over 80 percent of all new technologies and drugs come from the US due to our profit system. What it does provide, however, is some serious numbers that show that Obamacare will certainly cause enormous and far reaching damage to our nation's economic health.

Kevin Price is a syndicated columnist whose articles frequently appear at ChicagoSunTimes.com, Reuters.com, USAToday.com, and other national media. Kevin Price is also host of the Price of Business (M-F at 11 AM on CNN 650). Hear the show live and online at PriceofBusiness.com. Visit the archive of past shows here.

What Health Care Reform Should Look Like

You have heard the old saying about the "cure being worse than the disease" and that definitely seems to be the case when it comes to the health care reform debate. Virtually every reform suggested will make health care more expensive and reduce the accessibility of quality care for the vast majority of Americans who are already covered. This will happen because they will have to pay for both the private system and the public system. This will likely have the same effect that the government has had on education...sure, every one can use private schools, but you are going to have to still pay for the government schools. The result of this type of policy is that 90 percent of all young people go to public, rather than private, schools.

This is a shame, considering that the US has the best health care system in the world. The life expectancy of the average American has increased by over a third in the past sixty years - from 57 to 78 years. The US is the health care capital of the world, with hundreds of thousands of people traveling here for consultations with our physicians and treatment in our hospitals. Furthermore, the U.S. has the highest cancer survival rate in the world. According to the American Cancer Society, two out of three American cancer patients are alive five years after diagnosis. This stands in stark contrast to the situation in Britain (which is under a national health care system) where barely one half of cancer patients survive five years. Over time, almost half of those in Britain with breast cancer will die (48 percent), while only one fourth with die in the US (25 percent). It is not surprising that the majority of Americans prefer their health care over a government model, according to Fox News.

To make matters worse, the biggest issues when it comes to health care are not being addressed. One of the most important of these is role of the states. The federal government does not have a proper role when it comes to health care reform. According to Article I, Section 8, the Congress has seventeen powers, none of them include forcing people to buy something they do not want to purchase. With that, the states should continue to pursue various approaches in an effort to find a better way to pursue health care reform, including:

• Restoring competition among companies nationwide. Right now you can only buy insurance from companies that are in your state. Every effort should be made for individuals to be able to buy plans around the country and for states to reduce and eliminate mandates that essentially prohibit such.
  
• Fostering individual choice and competition through Health Savings Accounts. One of the biggest problems with health care is the lack of individual responsibility and freedom. If people had to pay more for certain health care procedures, they would think economically about their health care. One of the reasons why HMOs were largely a disaster is that the cost of visiting a physician was below anything market. People faced lines and had Department of Motor Vehicle treatment. The same is around the corner with socialized health care. With HSAs, an employer could provide for many procedures -- tax free -- directly to the employee. Meanwhile these plans could be bolstered with very high deductible plans (that are quite affordable) to cover major illness or injury.
  
• Encouraging competition and portability. The states should break down the barriers that prevent true competition when it comes to the purchase of health insurance policies. Some states have only one or two carriers because of ridiculous mandates. Freedom of choice should fall on the consumer.
  
• Serious tort reform. One of the single biggest drivers in health care costs is law suits. According to Fox News, many doctors pay as much as $200,000 a year in insurance coverage. Medical malpractice lawsuits add an enormous cost to the practice of medicine. No one is advocating that people should not have recourse for when things go wrong, but if the cost is open ended, the risks are enormous, leading to high insurance premiums and, in turn, the cost of going to a physician. The Democrats, who are driving the health care reform debate, have a very cynical view of the importance of tort reform. Howard Dean, while serving as the Party's chairman, said he "did not want to take on the lawyers," expressing greater concern about one of his party's constituencies than over real reform.
  

This list, of course, is only a beginning. Meaningful discussions on the cost of regulation, the impact price fixing has on physicians who accept Medicare and Medicaid, and many other topics are worthy of debate. What is most important is that we return the discussion where it belongs -- in state capitals around the country -- and we seek solutions grounded in freedom and not in more government.


Kevin Price is a syndicated columnist whose articles frequently appear at ChicagoSunTimes.com, Reuters.com, USAToday.com, and other national media. Kevin Price is Host of the Price of Business (M-F at 11 AM on CNN 650) and Publisher of the Houston Business Review. Hear the show live and online at PriceofBusiness.com. Visit the archive of past shows here.

Government and Health Care Costs

The most common arguments for government control of health care is making it available to everyone and excluding no one. Studies indicate that US indigent care (those who cannot afford health care of their own) is better than health care for those who have socialized medicine in other countries. Meanwhile, the vast majority of Americans who have private coverage enjoy the best care in the world. One of the other popular arguments I hear most often is about the "cost containment" that can only "come from government."

This is a big part of President Obama's message. In a speech back in September on health care that he delivered to Congress he said "The plan I'm announcing tonight would... slow the growth of health care costs for our families." More than for the President's remarks, this speech is better known for a comment by Congressman Joe Wilson (R-SC) in which he yelled that the President was lying in his speech. The Congressman was referring to the fact that the President claimed his health care bill would not include illegal aliens, but the lack of truth in Obama's "advertising" does not end there.

John Stossel points out in a recent column at FoxBusiness.com that "health care costs have been rising just as fast in countries with government-run health care. Since 1990, per person spending on health care has risen 159% in the US. But in England, with its government-run system, costs went up 210% over the same time period. Spending was up 148% in France and 124% in Canada, according to OECD data." The OECD is the Organization for Economic Cooperation and Development. So we see that government control has not contained costs and the methods used to keep spending down is the use of rationing health care. According to Canada's own health care system, the average Canadian must wait 17 weeks from the time a general physician finds something wrong and a specialist finally sees him or her. In many cases, that is the time frame of an early detected cancer becoming inoperable.

Stossel goes on to note that "It's true that we have always spent more on health care than countries with government systems. But that's partly because we're wealthier, and partly because other countries don't respect our drug patents, free-riding on our medical innovation." That innovation will decline with the undermining of our for profit health care system. I go a step further to mention that doctors in socialized countries do not have the liability issues that American physicians have. Doctors in this country recommend very expensive tests -- even if it is highly unlikely that the patient might have the condition the exam seeks -- in order to protect themselves from being sued by patients later. In socialized systems, it is virtually impossible to sue government doctors.

Finally, Stossel points out something both obvious, but profound, "Someone will ration health care. In America, insurance companies usually do it. In most of the rest of the world, governments do. Costs skyrocket under both systems. Its time we tried the third option: let individuals use their own money to buy health care."

I have been advocating "consumer driven health" long before it became a popular phrase in the insurance industry. The development of such an approach, seen in things like high deductible insurance policies and health savings accounts, have significantly reduced cost increases for businesses and individuals who have pursued such plans. The reason for this is simple, it gives the consumer (or in this case, the patient) a financial interest in the choices that are made in his or her health care. Individual responsibility should be the center piece of the health care debate, rather than abdicating health care to the government.

Kevin Price is a syndicated columnist whose articles frequently appear at ChicagoSunTimes.com, Reuters.com, USAToday.com, and other national media. Kevin Price is Host of the Price of Business (M-F at 11 AM on CNN 650) and Publisher of the Houston Business Review. Hear the show live and online at PriceofBusiness.com. Visit the archive of past shows here.