Speaker Pelosi’s Health Care Takeover: Bad for Young Americans
The Republican Conference has compiled a list of provisions in the Pelosi health care bill that would harm young Americans:
Bans Private Individual Health Insurance. H.R. 3962 would prohibit the issuance of new individual market health insurance policies effective in 2013, instead requiring all individuals to obtain more costly coverage that meets new and costly federal benefit mandates and regulations. This prohibition would eliminate a source of portable coverage for many young Americans, who utilize the individual market to obtain coverage for periods between jobs.
Higher Health Insurance Premiums. H.R. 3962 states that insurance carriers could vary premiums solely based upon family structure, geography, and age; insurance companies could not vary premiums by age by more than 2 to 1 (i.e., charge older individuals more than twice younger applicants). Average premiums for individuals aged 18-24 are nearly one-quarter the average premium paid by individuals aged 60-64. While supporting initiatives (such as State-based high-risk pools) that would provide affordable coverage to those with pre-existing conditions, the very narrow age variations allowed in H.R. 3962 as written would function as a significant transfer of wealth from younger to older Americans—and by raising premiums for young and healthy individuals, may likely discourage their purchase of insurance.
Taxes for Those Who Cannot Afford Coverage. The bill would impose a 2.5 percent tax on the income of all individuals who cannot afford to purchase a “bureaucrat-approved” policy—that is, one that meets all the new federal mandates and regulations imposed in the legislation. Particularly given the higher premiums that would be imposed on young people for the reasons described above, some may agree with then-Senator Obama when he pointed out last year that in Massachusetts, the one State with an individual mandate, “there are people who are paying fines and still can’t afford [health insurance], so now they’re worse off than they were. They don’t have health insurance and they’re paying a fine.”
Tax on Jobs Will Hurt Young Workers Hard. The Democrat legislation includes nearly half a trillion dollars in taxes on high-income filers—more than half of whom are small businesses—and would impose an additional $135 billion in taxes on businesses who cannot afford to finance their workers’ health coverage. This tax on jobs masquerading in the form of a “pay-or-play” mandate would put at least 5.5 million workers “at substantial risk of unemployment if their employers were required to offer insurance.” The Congressional Budget Office has also confirmed that such mandates “could reduce the hiring of low-wage workers,” and could also lead to wage stagnation as wage compensation is diverted to comply with new federal taxes and mandates. At a time when nearly one in four teens is unemployed, these harmful tax increases would hurt exactly the low-wage workers that a health care bill is intended to help.
Rising Debt a Fiscal Time Bomb for Future Generations. The Democrat health care bill contains nearly $1.3 trillion in spending over its first ten years—and excludes companion legislation regarding Medicare physician reimbursements (H.R. 3961) that would increase the deficit by more than $200 billion, as that bill is entirely unpaid-for. Treasury Secretary Geithner’s claims of the United States’ fiscal rectitude were publicly mocked by an audience during a visit to China—and growing the problem by adding well over $1 trillion in federal spending would only increase the debt burden to be faced by future generations.