It’s going to cost almost twice as much as they said it would.
Yeah, I’m shocked too. And I still think the estimate is low.
[Update a while later]
Here’s a new post by Phil Klein on the revised CBO estimates. Of course, as we said a that time, CBO estimates are always garbage in garbage out, and a lot of garbage went into it while it was being debated.
[Update a couple minutes later]
More on the lies from Guy Benson, with a bonus mention of the growing deficits, which means that there will be another debt-ceiling fight in the fall, before the election, if not sooner. Hilarious, considering all of the lies and charades the White House went through last summer to avoid that.
It’s worth noting here that some weasel is to point out the tax revenue side of this law. The US government through penalty payments and taxes, will collect somewhere around $413 billion in taxes over the 8 year period 2014-2021 (actually a bit more since there are apparently tax cuts in there which take effect now). That number has grown from $324 billion estimate in 2011 (which actually leads to a decline in overall cost of that eight year period, but only if it happens).
That revenue is obtained primarily through two factors: employers dropping health benefits (the CBO assumes these will be replaced with some taxable benefit) and an increase of penalty payments from the uninsured. The latter goes from a $34 billion total to $45 billion over the 2014-2021 period. Basically, we see over a single year huge changes in the CBOs estimates of human behavior which the CBO interprets conveniently to have a positive benefit for the US government’s bottom line.
It’ll also be interesting to see how much of this expected revenue will be lost through waivers and exemptions (such as for financial hardship or religious belief).
It’s going to cost almost twice as much as they said it would.
Only if you compare different time periods. The under-$1T projection was for 2010-2019, the $1.76T projection is for 2013-2022. All that means is that 2020-2022 will have much more spending than 2010-2012 (a period before ACA subsidies kick in), something that was projected all along.
In fact, if you read the linked Philip Klein post you learn that the CBO now estimates that for 2012-2021 the ACA will decrease the deficit by $48B more than previously forecast.
Yes, because we all know just how accurate those government estimates of health care costs have proven through the years.
Obama said it wouldn’t cost anything. That it would have zero impact on deficits or debt so what does that say?
I think it says that Obama and the Democrats have been telling lies to the public about Obamacare. It isn’t just about cost but about keeping your current plan if you want to or the federal funding of abortions.
Remember that guy who shouted you lie during the SOTU speech and how outraged people were about the lack of civility? Turns out that guy was right, Obama lied and the outrage is at someone pointing it out and not at Obama’s lies.
In fact, if you read the linked Philip Klein post you learn that the CBO now estimates that for 2012-2021 the ACA will decrease the deficit by $48B more than previously forecast.
And as usual, that forecast is based on rosy assumptions like that when the employer drops health care benefits, they’ll replace it with something that is equal in size and taxable. What we’re seeing here is a massive drop in employer based health insurance with, I think, a good chance that employees won’t get something back in exchange and as usual, the CBO fails to get it.
The point is that the CBO has to admit that costs for Obamacare are growing and there are huge costs in later years that were completely glossed over during the sell. As an adversarial agent, what they admit that is counter to their masters’ goals is probably some reflection of the truth.
My view is that over the next few years (assuming Obamacare isn’t overturned as being unconstitutional) we’ll see a significant drop in employee compensation, extending what has been seen just last year, with the ending of most employer-based health care benefits. So big increase in cost without a corresponding increase in tax revenue. We’ll also see a lot of uninsured, far more than predicted (keep in mind that $11 billion of that supposed $48 billion reduction comes from penalty fees from uninsured citizens).
Yet again, this is the sort of delusion you get from the “gold standard” of economic fantasy writers.
My view is that over the next few years (assuming Obamacare isn’t overturned as being unconstitutional) we’ll see a significant drop in employee compensation, extending what has been seen just last year, with the ending of most employer-based health care benefits.
If employers could make unilateral sharp cuts to compensation without hurting their businesses, they’d have done so already. What’s more likely is that employers will increasingly offer salary in place of health benefits. And that’s a good thing — moving from employer-based to individual health insurance offers more flexibility to both the employer and the employee. Today you have lots of people sticking with jobs they don’t want because they can’t risk losing health coverage; cutting the link between coverage and a particular job improves their lives, and the efficiency of the overall economy. It also makes it easier for people to consider self-employment and starting new businesses, e.g. without relying on a spouse’s job-based health benefits.
I would make that switch for my business except that one of my employees has been rejected for individual insurance due to his health history. Once the relevant ACA provisions take effect in 2014 that problem goes away.
We’ll also see a lot of uninsured
We’ll see far, far fewer than we see today, and for the first time even the uninsured who remain will be contributing.
If employers could make unilateral sharp cuts to compensation without hurting their businesses, they’d have done so already.
Did I say it wouldn’t hurt their businesses? No. One of the many factors here is uncertainty. Will the law even exist by 2014? The law could either be found unconstitutional or repealed by a Republican congress and president. We need to consider this fact that so many employers are will to go forward today even in the face of such uncertainty and negative consequences. I predict if the law survives to be implemented fully, we’ll see a near end to employer-based health insurance in the US, except among some governments.
We’ll see far, far fewer than we see today
You may be right. My problem with this statement is that there are no controls on health care costs and massive subsidies to demand for health care. It wouldn’t surprise me at all, if health insurance costs go up enough so that health insurances costs more, even with subsidy, than it does today.
Wha? Why would a guy your age, staring heart disease and cancer in the face, discard his best bargaining chip for group coverage? Was your last colonoscopy that good?
If employers could make unilateral sharp cuts to compensation without hurting their businesses, they’d have done so already.
They haven’t been able to do it unilaterally (until now). That kind of thing requires help from the government.
We’ll see far, far fewer than we see today
Depends on who is President in a year. If it’s Romney, we’ll be “seeing” far, far more than we do today. The media will ensure that.
They haven’t been able to do it unilaterally (until now).
Why not? What’s stopping employers from dropping coverage (without boosting salaries) today? [hint: the same thing that keeps them from cutting salaries, i.e. the need to attract and retain productive employees]
Jim, you should be considering the circumstances prior to implementation of the mandate in 2014. If a global condition causes every business to experience large cost increases at once, then yes, you can get near universal behavior.
the need to attract and retain productive employees
Jim, perhaps you don’t realize that it’s a “buyer’s market” when it comes to employers hiring right now. But hey, keep your own optics, it will be amusing to see how that works out for you throughout this year.