December 12, 2017

The American Health Care Act – The Real Story

The American Health Care Act(AHCA) passed congress yesterday, and unleashed a heckuva lot of commentary as the first step in repealing ObamaCare.

I’ll just mention in passing the antics of the Democrats, who voted in lockstep against it. They jeered and broke into one of those old anti-war sixties anthems, ‘Hey Hey, goodbye’ with the implication that those who voted for the American Health Care Act would be voted out of congress. That tactic gives you a good idea of the mental state of most of these people, who still think they’re back on campus smoking pot and protesting everything under the sun. Like Tallyrand’s Bourbons, the French dynasty overthrown by the Revolution, they’ve learned nothing and forgotten nothing. The comedy was completed by a rent-a-mob chanting ‘shame, shame’ as the GOP House members left the building.

Twenty Republicans also voted against the American Health Care Act, but they are mostly in Blue states and/or are members of what the media likes to call the moderate Tuesday club, meaning Republicans who lean more towards the Democrats in many of their positions. A couple of them are hard core conservative purists. I don’t think all that much of the GOP, but they do seem to be able to tolerate different points of view much of the time, as opposed to the Democrats.

So politics aside, what actually happened yesterday? To answer that question adequately, we have to delve into the true nature of ObamaCare.

Contrary to popular belief, ObamaCare was never a healthcare bill. As healthcare, it was designed to fail, and then be replaced by single payer. It was actually an outrageous tax increase. It was designed to pull billions of dollars out of the pockets of the American taxpayer and into the hands of the feds, where it could be spent on all sorts of priorities the Left holds dear,with the side benefit of completely subsidizing healthcare for important Democrat voting groups. It may have dismally failed as healthcare policy, but it definitely succeeded as a money machine for the Obama Administration’s progressive agenda.

Proof? Just look at what the American health Care Act does:

-Abolishes the Obamacare Individual Mandate Tax which hit 8 million Americans per year.

-Abolishes the Obamacare Employer Mandate Tax. Together with repeal of the Individual Mandate Tax repeal we’re looking at a $270 billion tax cut.

-Abolishes Obamacare’s Medicine Cabinet Tax which hits 20 million Americans with Health Savings Accounts and 30 million Americans with Flexible Spending Accounts. This is a $6 billion tax cut.

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-Abolishes Obamacare’s Flexible Spending Account tax on 30 million Americans. That’s is a $20 billion tax cut.

-Abolishes Obamacare’s Chronic Care Tax on 10 million Americans with high out of pocket medical expenses, a $126 billion tax cut.

-Abolishes Obamacare’s HSA withdrawal tax. This is a $100 million tax cut.

-Abolishes Obamacare’s 10% excise tax on small businesses with indoor tanning services. This is a $600 million tax cut.

-Abolishes the Obamacare health insurance tax. This is a $145 billion tax cut.

-Abolishes the Obamacare 3.8% surtax on investment income. This is a $172 billion tax cut.

-Abolishes the Obamacare medical device tax. This is a $20 billion tax cut.

-Abolishes the Obamacare tax on prescription medicine. This is a $28 billion tax cut.

-Abolishes the Obamacare tax on retiree prescription drug coverage. This is a $2 billion tax cut.

Get the picture? Just as ObamaCare was a huge tax increase, the American Health Care Act is a huge tax decrease

On its own, the American Health Care Act is not going to solve the rising cost of health care in America. As I pointed out here, no plan that doesn’t mention serious tort reform and doesn’t involve dealing seriously with our illegal migrant problem will.But it frees Americans from one of the foulest, most cynical frauds ever perpetrated on them, along with putting a lot more money back in people’s pockets. And it will at least slows the juggernaut down sufficiently until a real solution can be put together. As an added bonus, it allows states who want to opt out of certain insurance market regulations that exist under ObamaCare, including the “community rating” requirements that bar insurers from setting premiums based on health status. That will lower premiums all by itself.

That entire provision of ObamaCare was one of the tipoffs it was designed to fail from day one. The insurance business, especially health insurance is a sort of gambling game,one where the odds are decided by insurance company employees known as actuaries. The principle is a basic one that goes back to the time in the late Middle Ages when the whole concept of insurance was developed…risk versus return. Or to put it more bluntly, the amount of money the insurance company is getting in premiums (which in turn are invested, which is where most insurance companies make their real money) as opposed to what they might have to pay out for whatever the insurance covers in the event of a claim.

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If you buy auto insurance, an insurance company will want to look at your driving record, your age, your experience in operating an automobile and other factors including the value of the car you’re driving to determine what they will charge in premiums to give you the insurance coverage you’re requesting. If you drive a high end car, live in a neighborhood where car thefts are endemic, and have a lousy driving record with lots of violations, you will pay more for your insurance than if your driving a medium priced car, live in a neighborhood where car thefts aren’t so common and have a good driving record and lots of experience driving.

In states that require you to have auto insurance if you wish to drive, you can buy insurance as part of an assigned risk program no matter how lousy your driving record is. You simply pay more for it and there are laws determining what you can be charged for assigned risk.

The same thing’s true about healthcare if you think about it. If you’re a young, healthy individual you’re going to pay less because you represent a smaller risk versus return. If you go shopping for health insurance and you’ve had a heart attack or have other health complications, you will likely pay more. In any event, the ridiculous co-pays and deductibles ObamaCare was noted for will be history once this passes.

Because of course, it still has to pass, and I think it will, perhaps with a few tweaks. I had to chuckle when I saw various Democrats chest thumping about how ‘this will never pass the senate.’ I guess they’ve forgotten how they defied Senate rules and shoved through ObamaCare in the first place without a 60 vote majority by misusing the reconciliation process! But I have a feeling President Trump and Mitch McConnel haven’t.

Yes, real trailblazers and teachers they are, those Democrats…

Rob Miller

Rob Miller writes for Joshuapundit. His articles have appeared in The Jerusalem Post, The Washington Examiner, American Thinker, The Los Angeles Times, The Atlanta Journal-Constitution, The San Francisco Chronicle, Real Clear Politics, The Times Of Israel, Breitbart.Com and other publications.

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