If Hillary’s Elected President, Get Ready for Massive Obamacare Taxes

If Hillary’s Elected President, Get Ready for Massive Obamacare Taxes

REUTERS/Jessica Rinaldi

The Supreme Court will soon announce its decision in King v. Burwell, a case that could have far-ranging impact on the Affordable Care Act. The system more commonly known as Obamacare pays subsidies to taxpayers below 400 percent of the poverty line to cover health-insurance premiums. The plaintiffs in King argue that the explicit language of the law forbids subsidy payments to those purchasing health insurance outside of a state exchange.

If the Supreme Court decides to follow the explicit textual language of the ACA, people in 34 states could end up with skyrocketing premiums and no way to pay them. That portends disaster not just for those taxpayers who have to comply with the first-ever federal mandate to buy insurance regardless of any other interaction, it will deliver a body blow to the medical industry as well, Business Insider reports. “[E]conomists are projecting billions of dollars in lost healthcare spending for hospitals, drugstores and drugmakers if the justices say the payments are illegal.”

Related: Obama Readies His Veto Pen for a GOP Health Care Fix

With this potential for massive disruption approaching, the media have rushed to the accountability barricades by demanding a solution to the debacle from… Republicans. Bear in mind that Obamacare famously became law by using parliamentary tricks in which Democrats in Congress got around the fact that not a single Republican would vote for it. At the time, Nancy Pelosi bragged that Americans wouldn’t know what the ACA contained until Democrats shoved it past Republicans and onto Barack Obama’s desk for his signature.

Republicans now control Congress, largely on the unpopularity of Obamacare and especially the individual mandate that sets up this trap. Democrats wrote the language in question to force states into adopting the cost of the exchanges, as Obamacare architect Jonathan Gruber publicly admitted, so the backfire on this belongs entirely to Democrats. If the Supreme Court rules for the plaintiffs in King, the mess will drop into their laps, but that doesn’t mean they have to draft the solution to it. Many of the same Democrats responsible for this debacle still serve in Congress – Nancy Pelosi and Harry Reid, especially – and the media should be pressing them for their solution to the disaster they created, along with an explanation of how they’ll craft one Republicans can support.

Related: If Obamacare Collapses, These 9 Ideas Could Save Healthcare and the GOP

The same media dynamic has taken place in the nascent presidential primary. Republican candidates have to occasionally field questions about how they’ll fix Obamacare when most of them have gone on the record to note that they want to repeal it. The media doesn’t offer nearly the same amount of pressure on Democratic candidates to explain how they’ll fix a Democratic mess, but Hillary Clinton has offered a couple of hints anyway – at least indirectly.

First, rather than address the systemic dysfunction of Obamacare, Hillary wants to make it even larger and costlier than it is now. In an interview with the Des Moines Register, Hillary pledged to defend the ACA, but to fix its shortcomings. She promised to “fix the family glitch,” and “to deal with the high cost of deductibles that put such a burden on so many working families, and how to deal with the exploding cost of drugs, particularly the so-called specialty drugs."

However, both the family glitch and the high deductibles were deliberate choices by Democrats in the ACA. Both were trade-offs to keep premiums low, and therefore minimize the cost of the subsidies. The former only came to light in 2013, just before the disastrous rollout of the Healthcare.gov exchange. Essentially, it boils down to the employer mandate to keep insurance plans affordable for employees, capping their contributions to 9.5 percent of income – but Congress deliberately didn’t extend that to family coverage. Workers who have access to such insurance through employers can’t qualify to buy subsidized insurance for their families in ACA exchanges.

Related: Double Digit Rate Hikes Loom for Obamacare in 2016

That was a deliberate cost-cutting measure by Democrats, Chris Jacobs of America Next reminded Wall Street Journal readers. “To keep the total cost of insurance subsidies ... under $1 trillion, lawmakers made numerous tough choices,” Jacobs recalls. They delayed the start of subsidized insurance for a year, and put curbs on levels of subsidies in the later years of the ACA’s first decade.  “And Congress passed—whether lawmakers knew it or not—the “family glitch” provision.”

The need for higher deductibles was an even more explicit choice. Obamacare mandates higher risks for insurance pools, both in terms of eliminating barriers for pre-existing conditions and for preventive-care coverage. Insurers had to either hike premiums significantly to deal with the increased access or raise deductibles to force the costs back onto the consumer. The same tough choice that Jacobs notes in terms of holding subsidy costs below $1 trillion forced the Obama administration to pressure insurers into keeping premiums low, which meant either higher deductibles or bankruptcy. Anyone with even a passing understanding of risk pools could have easily predicted these outcomes.

Related: Obamacare’s $273 Billion Bonanza for Paper Pushers

Hillary remained notably silent on exactly how she would rework the ACA to undo the family glitch and lower deductibles, and especially how she would pay for the enormous increase in program costs that will result. Her campaign tipped their hand on their approach to fiscal problems earlier this week in announcing their schedule for releasing policy proposals. “Among these proposals,” press secretary Brian Fallon tweeted, “will be revenue enhancements.” As the Washington Examiner’s Jason Russell noted. “Revenue enhancements” is a euphemism on the same level as Bill Clinton’s use of “broad-based contributions” – tax hikes.

In the end, it may not matter what the Supreme Court decides on King v. Burwell. Democrats created a disaster far broader than the issue of subsidies in the federal exchange. The only solution Hillary and other Democrats have on the ACA are the massive tax hikes needed to fund the monster of government-mandated health insurance. Hillary can use all of the euphemisms for this she can find, but in the end Obamacare will bleed taxpayers dry.

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