During our All-Day Republican Caucus we discussed the Affordable Care Act (a.k.a. Obamacare) and its impact on state government and Utah citizens. The information presented was disconcerting to say the least.
To start, let me share a joke that was shared in our meeting:
A patient walks into the doctors office for a follow up exam. The doctor greets the patient:
Doctor: "I have good news and bad news for you, which do you want to hear first?"This morbid humor characterizes to a degree what Utah has been dealing with regarding Obamacare rules and regulations. The Federal government has asked the States to make specific decisions regarding how it will implement Obamacare policy. To help the States know how to make their decisions, the Feds have promised to give information on what the rules and regulations will be. Unfortunately, the Feds have not given the State enough information to make an informed decision. This, even while the deadlines continue to come and go. Governor Herbert's letter to Kathleen Sebelius best illustrates the Federal Government's failure: Governer Herberts Letter to Kathleen Sebelius
Patient: "Well, lets hear the good news first."
Doctor: "The good news is we found out you have five days to live."
Patient: "If that is the good news, what is the bad news?!"
Doctor: "The bad news is we got the lab results three days ago."
So this helps illustrate the dysfunction at the Federal level in implementing its own policy. They have created a bureaucratic monster so complex that they haven't figured out which feet to put on which legs or where the legs are supposed to go and how many there should be.
Yet, while the monster appears to be missing brains too, it is still armed with a powerful stinger. Starting in 2014, potent and painful penalties await the general public and business owners who find themselves on the wrong side of Obamacare:
- Families who do not have "qualified" health coverage will be fined up to $2,085 per year.
- Business owners (50 employee +) who do not provide "qualified" coverage for their employees must pay a fine of $2,000 per employee per year.
In addition, since the intent of the Affordable Care Act is to provide "affordable" health care for everyone, everyone will now be taxed more to pay for this newly affordable care. Starting in 2013:
- New 40% Excise Tax on High-Cost Plans
- Tax Deductions for Medicare Part D are Eliminated
- New Medicare Payroll Tax
- New Medicare Tax on Investment Income
- New $2,500 Limit to Flexible Spending Accounts
- Floor Raised on Deductible Individual Medical Expenses from 7.5% to 10% of Income
All these new taxes add up to about $492 BILLION in money leaving taxpayers pockets and going to the Federal Government. That equates to about $1,640 per American (man, woman, and child) in new tax burdens for 2013 alone. Yet more new taxes are scheduled for 2014 and beyond.
One of the most upsetting parts of Obamacare law (if you aren't upset enough already) is its effort to push as many people possible into Medicaid. The new law accomplishes this through devious financial incentives. For instance, if you are an individual who is not covered by your employer, you will likely seek an insurance policy as an individual in the new Exchange marketplace. (Exchange is a fancy term for a website that will have policies for you to buy.) If you get a personal policy, you can apply to get a tax credit for the cost of your premium for the year. However, to get that tax credit, you have to apply for Medicaid...even if you don't want Medicaid benefits. And, if you qualify for Medicaid, guess what? You don't get your tax credit!
This diabolical scheme creates the ultimate incentive for people to capitulate and enroll in Medicaid rather than indulge in such old-fashioned practices as self-reliance and rugged individualism.
Of course, all these new Medicaid applications need to be processed and Obamacare law requires that the States foot the bill for processing all this paperwork. It will cost Utahans at least $38 Million and could cost much more just to hire all the new paper shuffling bureaucrats to process the tax-credit applications each year. I can think of much better uses for that money; and I am sure you can too.
The 2013 General Session will prove eventful as we grapple with these new Federal laws that contradict Utah values. State statute must be changed by the will of the Legislature in order to bring our law in compliance with Obamacare. I am in favor of a strong dose of Federalism for just such an occasion.