There is troubling news regarding the future of employer-sponsored health insurance. What does that mean for you? How about less money and more stress? There are many of us with insurance through our employers–nearly 160 million to be exact. Understanding this is important because you could lose this coverage under the Obama health care plan if costs continue to skyrocket.
Employers large and small alike may elect to stop offering coverage because it is too expensive. This combined with an economy that some feel is only existing, not growing, could be a double whammy for the working class on all levels. I say this because those who lose their coverage from their employer will be forced to obtain their own insurance policy through a government run health insurance exchange or face a penalty which is enforced by taxes. That is the individual mandate that everyone has been talking about. Subsidies are available for individuals who make around $42,000 per year and families of four making $88,000 per year. The less you make, the more you receive in the form of subsidies.
Who pays for this? That is the $1 Trillion question. The simple answer is going to be all of us, in the form of higher taxes on all levels of government. Federal taxes are set to go up in January of 2013, when the existing tax policies passed under President George W. Bush, expire. Federal tax policy, budgeting and other things operate on ten-year time frames, and this one is set to expire. If nothing is done, taxes will go up for all of us on the federal level.
State taxes are going to go up as well, because the Medicaid expansion was an integral part of the law. It is also costly. Almost half of the cost of the healthcare legislation is due to the expansion of Medicaid to cover low-income individuals. This is troublesome for state governments because Medicaid spending plays such a large part in their yearly budgets, and it is growing fast.
Obamacare essentially doubles the size of Medicaid, and while federal funds are available to help the states with the expansion for a few years, it phases out over time. States will be forced to take on more costs in a time when many of them have balanced budget amendments. Cuts to other programs, like roads and higher education, are likely. This translates to bigger potholes and more student loans for younger Americans.
I am not trying to be the messenger of doom and gloom, but health care costs are a problem. Healthcare spending is 16 percent of the Gross Domestic Product (GDP) and growing. GDP is the fancy term for the entire United States economy, and it currently operates at about $15 Trillion.
The debt of the United States Government is almost $15 Trillion, and it is spending more than it is taking in. It is like our credit cards are all maxed out and if nothing is done we will be no different than Europe, where they are having all kinds of trouble. People in Greece were rioting in the streets because they could not receive their government benefits. Could that happen here? Who knows? Inform yourself and vote.
For more information on health care, the Affordable Care Act, aka Obamacare, and the latest developments from Washington, please continue to visit this site. And don’t forget to follow me on Twitter @SeanMMcGuire.
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