Behind the ObamaCare Boom – WSJ
Sweetened subsidies are attracting more takers, at taxpayer expense.
By The Editorial Board | Jan. 28, 2024 5:30 pm ET
Excerpts:
Government entitlements and subsidies invariably cost more than politicians advertise. Take the ObamaCare premium tax credits, which Democrats during the pandemic turned into a de facto public option for health insurance.
President Biden took a victory lap last week after the Health and Human Services Department reported that a record 21.3 million Americans had signed up for coverage on the ObamaCare exchanges. That’s nearly five million more than last year and nearly double as many as in 2020. “It’s no accident,” the President tooted. He’s right, but not in a good way.
The March 2021 American Rescue Plan Act sweetened the premium tax credits to make insurance on the exchanges free or nearly free for many middle-class Americans for two years. The Inflation Reduction Act extended the bigger subsidies through 2025, while his Administration rewrote ObamaCare rules to enable more families to qualify.
Because the enhanced subsidies make the plans cheaper than employer coverage, many more Americans are signing up on the ObamaCare exchanges. The pandemic Medicaid expansion also ended last spring, enabling states to remove people who no longer qualify. HHS says many who left Medicaid signed up for ObamaCare plans.
Recall that Democrats claimed that extending the sweetened subsidies for three years would cost a mere $64 billion. But a conservative back-of-the-envelope calculation based on enrollment and the average tax credit indicates that the subsidy boost this year alone will cost some $70 billion—meaning it could end up costing three times what the politicians claimed.
When the government creates an open-ended subsidy, more people than predicted always show up to the buffet. The pandemic Medicaid expansion cost more than six times the original $50 billion estimate. The Covid-era Employee Retention Credit was initially estimated to cost $55 billion, but the final price tag may be upward of $470 billion as tens of thousands of businesses continue to claim it.
The truth is that you can’t trust Congress’s budget estimates. The bipartisan tax deal now moving through the House to boost the child tax credit and renew some business tax breaks is estimated to cost $78 billion. The smart money will take the over.
______________________________________
And on we go… more people dependent on government programs, more price distortion in private markets, ongoing ‘projected cost’ blowouts, ballooning federal budget deficits.
Washington Democrats (and Republicans) have America on track for credit market chaos.
There is currently one plan (and only one plan) on the table with the power to: 1) Revive free-market efficiencies and economic viability in the U.S. healthcare system; 2) Restore order and stability to credit markets, and; 3) Get America back on track for federal budget surpluses, sound money, and financial security for millions of hard-working, tax-paying U.S. citizens.
The Leviticus 25 Plan – An Economic Acceleration Plan for America
$90,000 per U.S. citizen – Leviticus 25 Plan 2025 (11994 downloads )