A hidden Obamacare provision could bury US businesses under a large new health care fee. According to the WSJ, the Affordable Care Act will charge employers an extra $63 for each person they insure. This tax will raise $25 billion dollars from companies and other providers over the next three years. As we’ve come to expect from the bill that we had to pass so we could find out what was in it, businesses had no idea this was coming:
“It’s caught most employers, if not all employers, by surprise,” said Steve Wojcik, vice president of public policy at the National Business Group on Health in Washington, which represents large employers. “They’re very upset about it.”
Insurance companies are largely responsible for adding the provision. They claim that it will offset the costs of taking on a lot more sick, high-risk customers under the expanded access Obamacare sets up. The HHS estimates that this fee “will lower premiums for people who buy plans through the individual insurance market by between 10% and 15%.”
But meanwhile another story published in the Washington Post indicates those premiums are going up anyway. Insurers are claiming that new health care taxes and reconfigured insurance plans could make the rates could go up by 20 to 100 percent for millions of Americans:
Mark Bertolini, CEO of Aetna Inc., one of the nation’s largest insurers, calls the price hikes “premium rate shock.”
“We’ve done all the math, we’ve shared it with all the regulators, we’ve shared it with all the people in Washington that need to see it, and I think it’s a big concern,” Bertolini said during the company’s annual meeting with investors in December.
The young will see some of the biggest premium increases, but supporters of the law claim that tax credits and subsidies will nearly eliminate the actual out-of-pocket cost of these increases. But as the WSJ piece shows, these subsidies will be paid for by other kinds of fees levied elsewhere. Obamacare sets up a health care economy of criss-crossing dollars where the real costs of premium increases are hidden by the complexity of a system of subsidies and counter-subsidies.
Ultimately it’s the young who will be stuck with the consequences of this mess. In response to the new fee, many employers are claiming they will offer fewer benefits in their health care packages. At worst, they will hire fewer workers. Either way, the young will bear the biggest burden of this hastily passed policy experiment.