The House has yet to vote on a final bill, and the Senate has yet to release any complete legislation, but the various health-care reform proposals are starting to shape up. And, not surprisingly, there's quite a bit to worry about. Here's a recap of the major objections currently making the rounds:
It will not save money. In fact, according to CBO director Douglas Elmendorf, it will "significantly expand the federal responsibility for health-care costs," exacerbating rather curing the dire, health-care driven budget problems we already face. As Ron Bailey pointed out earlier today, this is the result when you use official government cost estimates. And as the Massachusetts experiment with universal coverage taught us, the true cost of any universal-coverage oriented health-care overhaul is likely to be far higher than projected.
It will likely shift people away from their current health-insurance plans. Depending on the final details surrounding the proposed public plan, some people will almost certainly end up moved away from their current plans. At a bare minimum, Obama's promise that individuals will be able to keep their current health-insurance is misleading.
It will raise taxes.On people who make too much money, perhaps. Or perhaps on people who make money off of rental units. Or maybe, if Senate Finance Chairman and health-care poobah Max Baucus has his way, it will tax the middle class by way of their employer-provided health benefits. No matter what, any bill will cost a lot of money, so someone's going to pay for it.
It will be tough on small and medium-sized businesses. According the Wall Street Journal, under the current House plan, "all but the smallest businesses" would be slapped with "a penalty equal to 8% of payroll if they fail to provide health insurance to workers." Meanwhile, the drug industry, which Obama promised to "take on" during the campaign, has extracted endless concessions, and supposed liberal villain Wal-Mart would make out rather well by using legislation as a weapon against its competitors.
It will pave the way for health-care shortages. There's widespread agreement that the current system of medical provider payments in Medicare and Medicaid is a mess. But depending on how the plan shakes out, reduced doctor payments might essentially result in a system of health-care price controls, potentially causing shortages in care. Even if the system were set up so as not to reduce payments now, one can easily imagine anxious government officials cutting payments in the future in response to unexpected cost overruns like we've witnessed in Massachusetts.