Hatch: One Year After Passage, Obamacare a Sinking Ship


Time to Abandon Ship for State-Based Health Approach

This past week marked the one-year anniversary of the Patient Protection and Affordable Care Act – Obamacare to the uninitiated — that the President signed into law on March 23, 2010. The ink was barely dry when the significant additional costs of the health care law became clear.

First out of the gate was the impact of eliminating the tax break for the Part D premium assistance for businesses, which cost them over a billion dollars in losses. Next came the provision requiring businesses to report payments in excess of $600 for services or merchandise to the IRS on a 1099 form.

Another provision requires individuals to receive a prescription from their doctors prior to purchasing over-the-counter allergy medication with their Flex Spending or Health Savings Accounts.  You now have mothers calling pediatricians, so they can get prescriptions for infant Motrin and diaper-rash cream.

And, of course, we can’t forget the mandates and regulations on what kind of health coverage individuals can buy. To pass the law, advocates inserted a host of new requirements from Washington, which will lead to even higher premiums for families and small businesses.

Implementing these new mandates has been chaotic, with federal bureaucracies bypassing public comment on how the new rules will impact American lives and businesses. And the Obama administration has had to provide exceptions – more than 1,000 waivers and 2.6 million people exempted to date – to these unworkable new rules.

And the real fun has not even started.

The Congressional Budget Office recently concluded that “[S]pending for Social Security, Medicare, Medicaid, and other health care programs will grow from 9.9 percent of GDP in 2010 to 12.0 percent by 2021, driven largely by rapid growth in health care costs.” Even the Administration’s own Chief Actuary concluded that national health expenditures will increase due to Obamacare.

To pay for these expanded entitlements, the law hiked taxes by hundreds of billions of dollars from the nearly bankrupt Medicare program – not to make Medicare solvent, but to create another unsustainable entitlement.

Obamacare is a sinking ship, and when it starts to go below the waves, the very groups and organizations that sought refuge in special deals with the White House will be the first groups Democrats turn to for more money to fill the holes.

That is why we need to repeal the health law in its entirety. The House already voted to do so.  Then – along with my Republican colleagues in the Senate – I voted to repeal the law as well.

If the Democrats will not let us repeal Obamacare wholesale right now, we will do so retail through death by a thousand cuts.  We will fight this until we win.

I have introduced a bill to repeal the law’s $20 billion tax on medical device manufacturers.  Under this provision, medical devices ranging from surgical tools to bed pans will get hit with a 2.3 percent excise tax. This will cripple the medical device industry, which employs nearly a half-million people and is one of the nation’s leading net-exporters. It will also drive up the price of patient care.

The medical device tax might be an affront to our economy, but the individual mandate that forces people to buy insurance or pay a fine is an affront to our Constitution, which is why I have introduced legislation to repeal it.  I have also introduced legislation to repeal the employer mandate.  In a time of record unemployment and extreme uncertainty about the burden of thousands of pages of new regulations coming out of the White House, the last thing employers need is another costly mandate that will force them to lower wages, freeze hiring and drop coverage, leaving workers with the option of purchasing insurance through the exchanges.

But once Obamacare is completely dismantled — and I am confident that it will be — what will emerge in its place? We need to replace it with state-based approach that lowers health care costs and fixes our unsustainable entitlement programs.

Step one will be relieving states of the massive fiscal burdens imposed by a relentlessly expanding Medicaid entitlement.

A truly workable health care reform would be modeled on the bipartisan and highly successful welfare reform of the 1990s, which took ideas from the states — not just Washington — and gave them considerable flexibility to operate their own programs.

There is an enormous reservoir of expertise and experience in the states.  And any federal reform of the nation’s health care system should take advantage of this state-based wisdom.

We face many challenges on health care, but ultimately I am hopeful.

The fact is, our nation can’t continue on its current course.  Eventually something will have to give on both health care costs generally and Medicare and other entitlements more specifically.

We must start down the road of real reform sooner rather than later.

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