Monday, March 26, 2012

Obamacare is Heading to the Supreme Court

Obamacare, also known as the Patient Protection and Affordable Care Act, is being argued before the Supreme Court this week (Florida v. U.S. Department of Health and Human Services). Not only have more than half of the states decided to sue the federal government over Obamacare, but SCOTUS is hearing six hours of argumentation, which we haven't seen since SCOTUS established Miranda rights back in the 1960s.

It should be no secret that I dislike Obamacare. It's merely another instance in which the government can be highly intrusive in the lives of the American people. Rather than make an unsubstantiated statement about this government program, let me provide a bit of reasoning as to why I hope the justices on the Supreme Court are swayed to do away the Patient Protection and Affordable Care Act in its entirety.

Although Obama has claimed enough reasons as to why Obamacare will be great for America, there are two that I specifically recall. The first is that no one will have to forego their current insurance. The second is that it would only cost $900 billion over ten years. As if I were at all surprised, Obama was 0 for 2 on those promises. You can look at the recently published CBO report for yourself. According to the CBO (p. 4), "because of the ACA, about 3 million to 5 million fewer people, on net, will obtain coverage through their employer." So much for "everyone can keep their plan." Another interesting thing about the CBO report was on Table 4, the table that projects scenarios about the costs (a.k.a. the "gross cost of coverage pensions"). The best-case scenario was $1,541B, whereas the worst-case projection was $2,134B. If my math skills serve me correctly, 1,541 > 900. So much for cost-controlling. And knowing the government's prognosticating skills, I am going to take an educated guess that in hindsight, the figures will be on the higher end. Based on common sense, I knew back in 2010 that $900B was such a low figure. Did the president honestly think that he could provide more benefits to more citizens and not expect the price tag to be higher? It defies the most basic concepts of supply and demand. If this actually gets passed by the Supreme Court, expect tax hikes and new taxes because the government needs to find a source of revenue to fund this monstrosity.

The price tag of Obamacare is not the only thing that has me on edge. The individual mandate, which is the highlight of these proceedings, is such an encroachment on individual liberty. Why? This is such a basic violation of contract law that it's not even funny. Government has regulated activity throughout American history, but never has regulated inactivity, which is another way of saying "the American government has never forced an individual to buy something against their will." The Supreme Court has never granted Congress the ability to regulate inactivity under the Commerce Clause. If SCOTUS does manage to grant that power through the individual mandate (Section 1501), we might as well start digging the grave for contract law because the message that would be sent through a ruling not in favor of liberty would be that the federal government is unbounded in what it can regulated, which would unleash further regulations.

Individuals are not the only ones who get coerced into paying health insurance. There is also an employer mandate. According to Sections 1513 and 2980H of the legislation, any employer with over 50 employees who opts to not provide their employees with health care will also be fined. I'd imagine that it is a safe assumption this mandate hurts small businesses much more than it does large businesses. Just another reason for small-to-medium business to not hire more workers during this recession.

I have only covered some of the basics on Obamacare. This bill constitutes multiple pages of health care regulation that the predominantly Democratic Congress shoved down the throats of the American people before anybody, including Congress, had ample time to read it. After two years of analyzing the implications of such a bill, it has only become more and more evident that implementation would have averse effects. As far as I'm concerned, the whole bill should be scrapped. You might be able to pick out a good provisions that are good ideas, like covering those individuals with pre-existing conditions or extending family health care to individuals up to the age of 26, but you shouldn't use those provisions as a red herring in order to justify a bill that will increase health care costs while doing nothing to improve health care quality. I am going to be attentive of this SCOTUS case because it would be great to tell future generations that this was the juncture in which we avoided disaster.

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