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Facts Deflate Sebelius?s Defense of Obamacare

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Unread 07.12.12, 04:00 PM
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Facts Deflate Sebelius?s Defense of Obamacare

On 07.12.12 11:00 AM posted by Alyene Senger

It must be a tough job defending Obamacare, but someone’s got to do it. This week, that someone is Secretary of Health and Human Services Kathleen Sebelius, who wrote an op-ed for The Washington Post.

A Decrease in Health Care Costs? Not So Fast

Sebelius says national health expenditures have increased only by about 4 percent annually over the past two years, significantly less than in previous years.

Sure—health care costs did, in fact, slow somewhat over the last few years. But the trend started before Obamacare even became law. The real reason for slowed growth in health care costs, as Administration officials themselves explain, is the poor economic climate.

Sebelius goes on to tout that health care costs are “projected to stay level as a share of gross domestic product from 2009 all the way through 2013.” Why stop at 2013, Madam Secretary? Well, as Heritage has pointed out, that’s because 2014 is the year that the most expensive spending provisions of Obamacare kick in. The Medicare actuary has the real story: the next decade will experience “overall acceleration in projected national health spending growth to 7.4 percent, which is 2.1 percentage points faster than would be expected in the absence of health reform.”

Sebelius actually claims that Obamacare lowers premiums. But an annual employer survey shows that premiums for employer-based coverage grew faster from 2010 to 2011 than they did they year before. Not only that, but Kaiser Family Foundation CEO Drew Altman even stated that Obamacare was responsible for between one and two percentage points, or approximately 20 percent, of the premium increase.

Relief for Small Businesses? Not Really

According to the Secretary, “new tax credits in the law are saving hundreds of thousands of small companies thousands of dollars each on their insurance costs.”

But the truth is that, despite original estimates that 4 million small businesses would be eligible for and benefit from Obamacare’s small business tax credit, only 28,100 employers claimed the full credit amount. The Government Accountability Office even concluded that the credit was not big enough to incentivize employers to offer coverage and was too complex and time-consuming to file for.

The tax credit eventually phases out in 2016, and it doesn’t make up for the overall impact of Obamacare on small business owners, which includes new taxes, penalties, and other regulatory burdens that inhibit growth.

Obamacare Strengthens Medicare? Not Quite

Last but not least, Secretary Sebelius argues that under Obamacare, “Medicare is stronger than ever.” She claims that the Medicare savings achieved in Obamacare extends the solvency of the program. But the Secretary and supporters also argue that the new spending in the law is paid for by using these same Medicare savings.

The Secretary also attributes lower Medicare Advantage premiums to Obamacare. But what she neglects to let readers know is that Obamacare all but destroys Medicare Advantage plans by cutting $145 billion from them. Heritage analysis predicts, “About half will lose Medicare Advantage coverage entirely. Others will stay in Medicare Advantage, but at reduced benefit levels and possibly in different plans that do not meet their needs as well.”

Sebelius says it best herself: “People are entitled to their opinions, but not to their own facts. And the facts in this case are clear.” However, the facts aren’t on the side of Obamacare.

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