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Factsheet #64 on Health Care, Taxes and Entitlements

June 25, 2010

Obamacare: Hurting Those Who Need Health Care the Most

Side Effects of ObamacareEffects on Families

  • Millions Still Without Coverage: One of the goals of the Patient Protection and Affordable Care Act was increasing health care coverage for Americans. However, the Congressional Budget Office has estimated that 23 million people will be uninsured even with the new law.
  • Higher Taxes: President Obama’s health law broke his campaign promise to not raise taxes on American families making less than $250,000 a year. New taxes on health care products and services will ultimately be passed onto consumers regardless of their income status.
  • Less Choice: Obamacare advocates claim that subsidies will help families reduce their health care costs. But with government control of benefits and insurance, many families will see their coverage options reduced and will face higher premiums.
  • Ineffective Plans: Under Obamacare, families are forced to buy health plans that include costly and unnecessary coverage services. They’re also required to buy plans that cover services they could find morally reprehensible.

Effects on Parents, Couples, and Children

  • Limits Parental Oversight and Control: Obamacare allocates $50 million each year to school-based health centers, which typically offer contraception or abortion services. While there are some “restrictions” requiring these clinics to honor parental consent and notification laws, existing law already grants confidentiality privileges to teens, nullifying state and local policies.
  • Punishes Couples Choosing Marriage: Through its “affordable” subsidy, the new health law financially penalizes marriage. This marriage penalty will discourage young couples from choosing marriage, incentivizing them to cohabitate out of wedlock. Additionally, the rule entices older couples into “divorces of convenience.” A married couple older than 60 who make a combined annual income of $60,000 could save more than $10,000 if they divorce and simply live together.

New Obamacare Realities

  • Mandates on Individuals and Families: The individual mandate, which requires people to buy health insurance or pay a penalty, is a de facto tax increase. In 2016, the penalty for an individual not purchasing government-approved health insurance will reach $695, or 2.5% of taxable income.
  • Loss of Existing Coverage: The President promised that Americans could keep their current health coverage. But Obamacare will result in millions of Americans losing their plans. More than 14 million Americans will likely lose or be transitioned out of their work-based coverage according to the Chief Actuary at the Centers for Medicare and Medicaid Services (CMS). Much of this comes from economic incentives that will drive employers to dump their workers into heavily subsidized plans that are part of the federally mandated health insurance exchanges.
  • Exacerbating Government Dependency: Although Obamacare supporters claim that the new law will expand options, more than half of the uninsured (some 18 million Americans) gaining coverage will be herded into Medicaid, a poor-performing and financially unstable government health program.
  • More Burdens on Emergency Rooms: The Centers for Disease Control shows that Medicaid patients made up 25.5% of all emergency room visits in 2006, compared with 17.4% of uninsured patients. Increasing the number of people dependent on Medicaid will only compound this problem.

For more information, please visit: http://www.heritage.org

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