As the New Year unfolds and congressional Democrats meet with the President behind closed doors trying to reconcile the differences between the House and Senate versions, they also appear to have lost a good deal of the optimism they had just a few weeks ago about health reform's prospects. Sen. Chris Dodd (D-Conn.) recently said that healthcare reform was "hanging by a thread." And on the other side of the Capitol, Rep. Charlie Rangel (D-N.Y.) said, "We've got a problem . . . A serious problem." Negotiations over a final bill may well drag into February.
This discord within the Democrats' ranks offers Americans a renewed opportunity to learn about the sweeping changes augured by the congressional reform package. What they'll discover is a bill that hikes taxes to pay for "reform," making health care more expensive and less responsive to patients' needs.
New insurance regulations form the core of the reform plan. Paramount among these new rules is an individual mandate, which would require all Americans to maintain coverage. Proponents of the idea claim that it will bring healthy, previously uninsured young people into the insurance pool. Premiums from these folks would help lower the premiums of older, sicker Americans -- or so the thinking goes.
Unfortunately, these regulations would make both the uninsured and the majority of the middle class worse off. Most uninsured Americans go without coverage not because they want to but because they can't afford it. The Democrats' reform package does nothing to address this problem. In fact, health insurance costs would grow faster under the Senate bill than they would without reform.
People who refuse to buy insurance would be fined anywhere from $95 to $2,250 a year. By the time the fines are fully implemented, a typical individual insurance policy is expected to cost about $5,000, according to the Congressional Budget Office (CBO). Americans faced with the choice of forking over thousands of dollars a year for unaffordable coverage or paying a fine will likely opt for the latter. Other proposed regulations on insurance policies make such an outcome even more likely. Case in point: the reform plan's requirement that insurers accept all applicants, regardless of their health status or medical history.
Sally C. Pipes serves as a health care advisor to The Rudy Giuliani Presidential Committee. She is President and CEO of the Pacific Research Institute. She is author of Miracle Cure: How to Solve America’s Crisis and Why Canada Isn’t the Answer.
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