Myth 1: This is a universal health care bill.
Fact: The bill is neither universal health care nor
universal health insurance. According to the
Congressional Budget Office:
- Total uninsured in 2019 with no bill: 54 million
- Total uninsured in 2019 with Senate
bill: 24 million
Fact: This bill is almost identical to the plan
written by AHIP, the insurance company trade
association, in 2009.
The original Senate Finance Committee bill was authored
by a former Wellpoint vice president. Since Congress
released the first of its health care bills on October
30, 2009, health care stocks have risen 28.35%.
Myth 3: The bill will significantly bring
down insurance premiums for most Americans.
Fact: The bill will not bring down premiums
significantly, and certainly not the $2,500/year that
President Obama promised during his campaign.
Annual premiums in 2016: status quo / with
Small group market, single: $7,800 / $7,800
Small group market, family: $19,3oo / $19,200
Large Group market, single: $7,400 / $7,300
Large group market, family: $21,100 / $21,300
Individual market, single: $5,500 / $5,800
Individual market, family: $13,100 / $15,200
(The cost of premiums in the individual market goes
up somewhat due to subsidies and mandates of better
coverage. The CBO assumes that cost of individual
policies goes down 7-10%, and that people will buy more
Myth 4: The bill will make health care
affordable for middle class Americans.
Fact: The bill will impose a financial hardship on
middle class Americans who will be forced to buy a
product that they can't afford to use.
A family of four making $66,370 will be forced to pay
$5,243 per year for insurance. After basic necessities,
this leaves them with $8,307 in discretionary income --
out of which they would have to cover clothing, credit
card and other debt, child care and education costs, in
addition to $5,882 in annual out-of-pocket medical
expenses for which families will be responsible.
Myth 5: This plan is similar to the
Massachusetts plan, which makes health care affordable.
Fact: Many Massachusetts residents forgo health care
because they can't afford it. A 2009 study by the state
of Massachusetts found that:
- 21% of residents forgo medical treatment because they
can't afford it, including 12% of children
- 18% have health insurance but can't
afford to use it
million people who are currently uninsured.
Fact: This bill will mandate that millions of people
who are currently uninsured purchase insurance from
private companies, or the IRS will collect up to 2% of
their annual income in penalties. Some will be assisted
with government subsidies.
Myth 7: You can keep the insurance you have
if you like it.
Fact: The excise tax will result in employers
switching to plans with higher co-pays and fewer covered
Older, less healthy employees with employer-based health
care will be forced to pay much more in out-of-pocket
expenses than they do now.
Myth 8: The "excise tax" will encourage
employers to reduce the scope of health care benefits,
and they will pass the savings on to employees in the
form of higher wages.
Fact: There is insufficient evidence that employers
pass savings from reduced benefits on to employees.
Myth 9: This bill employs nearly every cost
control idea available to bring down costs.
Fact: This bill does not bring down costs and leaves
out nearly every key cost control measure, including:
- Public Option ($25-$110 billion)
- Medicare buy-in
- Drug re-importation ($19 billion)
- Medicare drug price negotiation ($300 billion)
- Shorter pathway to generic
biologics ($71 billion)
like Wal-Mart to provide insurance for their employees.
Fact: The bill was written so that most Wal-Mart
employees will qualify for subsidies, and taxpayers will
pick up a large portion of the cost of their coverage.
Myth 11: The bill "bends the cost curve" on health care.
Fact: "Bends the cost curve" is a misleading and
trivial claim, as the U.S. would still spend far more
for care than other advanced countries.
- In 2009, health care costs were 17.3% of GDP.
- Annual cost of health care in 2019, status quo:
$4,670.6 billion (20.8% of GDP)
- Annual cost of health care in 2019,
Senate bill: $4,693.5 billion (20.9% of GDP)
to insurance for Americans who are uninsured because of
a pre-existing condition.
Fact: Access to the "high risk pool" is limited and
the pool is underfunded. Only those who have been
uninsured for more than six months will qualify for the
high-risk pool. Only 0.7% of those without insurance now
will get coverage, and the Centers for Medicare and
Medicaid Services report estimates it will run out of
funding by 2011 or 2012.
Myth 13: The bill prohibits dropping people
in individual plans from coverage when they get sick.
Fact: The bill does not empower a regulatory body to
keep people from being dropped when they're sick. There
are already many states that have laws on the books
prohibiting people from being dropped when they're sick,
but without an enforcement mechanism, there is little to
hold the insurance companies in check.
Myth 14: The bill ensures consumers have
access to an effective internal and external appeals
process to challenge new insurance plan decisions.
Fact: The "internal appeals process" is in the hands
of the insurance companies themselves, and the
"external" one is up to each state.
Ensuring that consumers have access to "internal
appeals" simply means the insurance companies have to
review their own decisions. And it is the responsibility
of each state to provide an "external appeals process,"
as there is neither funding nor a regulatory mechanism
for enforcement at the federal level.
Myth 15: This bill will stop insurance
companies from hiking rates 30%-40% per year.
Fact: This bill does not limit insurance company rate
hikes. Private insurers continue to be exempt from
anti-trust laws, and are free to raise rates without
fear of competition in many areas of the country.
Myth 16: When the bill passes, people will
begin receiving benefits under this bill immediately
Fact: Most provisions in this bill, such as an end to
the ban on pre-existing conditions for adults, do not
take effect until 2014.
Six months from the date of passage, children could
not be excluded from coverage due to pre-existing
conditions, though insurance companies could charge more
to cover them. Children would also be allowed to stay on
their parents' plans until age 26. There will be an
elimination of lifetime coverage limits, a high risk
pool for those who have been uninsured for more than 6
months, and community health centers will start
Myth 17: The bill creates a pathway for
Fact: Bernie Sanders' provision in the Senate bill
does not start until 2017, and does not cover the
Department of Labor, so no, it doesn't create a pathway
for single payer.
Obama told Dennis Kucinich that the Ohio
Representative's amendment is similar to Bernie Sanders'
provision in the Senate bill, and creates a pathway to
single payer. Since the waiver does not start until
2017, and does not cover the Department of Labor, it is
nearly impossible to see how it gets around the ERISA
laws that stand in the way of any practical state single
Myth 18: The bill will end medical bankruptcy and
provide all Americans with peace of mind.
Fact: Most people with medical bankruptcies already
have insurance, and out-of-pocket expenses will continue
to be a burden on the middle class.
- In 2009, 1.5 million Americans declared bankruptcy
- Of those, 62% were medically related
- Three-quarters of those had health insurance
- The Obama bill leaves 24 million without
- The maximum yearly out-of-pocket limit for a
family will be $11,900 (PDF) on top of premiums
- A family with serious medical
problems that last for a few years could easily be
financially crushed by medical costs
Real health care reform is needed. But this bill falls
short of that on many levels.