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The Real Impacts of the Proposed Health Care Reform Bills

Lost Coverage

The proposed bills include a new government health plan the public option. A public plan will lead many employers to drop private health coverage for their workers and push many of them toward the public plan, just as many employers in the 1990s pushed their workers into cheaper managed care plans. The result? Individuals will lose their existing coverage and private insurance would be crowded out of the market by the government.

According to independent analysis of the House bill by the Lewin Group, as many as 103 million Americans would end up in a public plan (assuming eligibility to the new exchange is open to all employers). The Lewin study also found:

  • 48 percent–almost half–of privately insured Americans would transition out of private insurance.
  • About 88.1 million workers would see their current private, employer-sponsored health plan go away.
  • Yearly premiums for the typical American with private coverage could go up by as much as $460 per privately insured person, as a result of increased cost-shifting stemming from a public plan modeled on Medicare.

Tax on the Rich and Small Businesses

The House bill includes a 5.4% surtax on over 2 million high-income Americans about half of them small business owners. And thats not all: President Obama would have the power to increase the surtax.

Go here to find out how many taxpayers will be affected in your state.

The large tax increases proposed by House Ways and Means Chairman Charlie Rangel (D-NY) would harm over a million small businesses, making them less likely to expand and hire new workers, Heritage senior policy analyst Rea S. Hederman Jr. writes. Congress should not pass large tax increases on businesses that would hinder employment.

Tax on the Poor

A tax hike is coming for low-income workers too, cleverly disguised in the form of employer health care mandates, which both the House and Senate drafts of health care reform include. Here is how it works:

  • These so-called employer mandates require employers to either pay a significant portion of their employees health care premiums or pay a new 8% payroll tax on top of existing taxes.
  • Employers will be forced to cut employee wages to make up for these new taxes.

This mandate will hit low-income employees the hardest, as employers may be forced to lay off employees at or near the minimum wage.

To find out more, visit www.fixhealthcarepolicy.com .

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