35 Million Could Lose Coverage Under ObamaCare!

Peter Suderman cites a “study” showing that 35 million Americans who are currently insured could lose their coverage and be forced into the government pool.

A number of big employers are already considering dropping employee coverage, and a new study from former Congressional Budget Office director Douglas Holtz-Eakin and Cameron Smith suggests that, depending on the details of the insurance employers currently offer, the number could be far higher. According to their analysis, the law “provides strong incentives for employers—with the agreement of their employees—to drop employer-sponsored health insurance for as many as 35 million Americans.” If that happened, it would raise the bill’s cost from about a trillion dollars to an estimated $1.4 over the first decade.

Here’s the gist: Thanks to a combination extremely generous subsidies extended even to families making comfortable middle incomes and relatively weak employer penalties, it may be cheaper for employers to drop coverage. In addition, the value of the subsidies may be effectively greater for many employees than the coverage they would have gotten through their employers. Liberal supporters of the bill will no doubt say that’s exactly the point—to provide more valuable coverage to those in lower and middle incomes.

Now, I happen to find the argument quite believable.  Indeed, this is what I presumed would happen — indeed, what I presumed the Democratic leadership wanted to happen.  That is, I figured that the incentives were set up precisely to destroy the current employer-based health insurance system and lead to a backdoor “public option” that would otherwise have been a political non-starter.

But I’m afraid a “study” by the American Action Network, an advocacy group launched in February which makes no bones about being a shill for Republican interests, is hard to take seriously.  When the results are foreordained, it’s just not scholarship.

FILED UNDER: Bureaucracy, Economics and Business, Health,
James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. Michael says:

    Indeed, this is what I presumed would happen — indeed, what I presumed the Democratic leadership wanted to happen

    Probably what more than a few Republicans wanted to happen too.

  2. Stan says:

    How do the new national penalties on employers for not providing medical insurance compare with those already in effect in Massachusetts and Hawaii? How many employers in these states prefer paying the penalties to providing insurance? What is the cost of insurance in these states? And why don’t web sites like this one actually look at what’s happened in the states rather than cite obviously partisan studies? Aren’t the states supposed to be laboratories for testing new policies?