ObamaCare
in Trouble?
Exchange provision delayed, as lawmakers push to repeal another
Published
April 03, 2013
FoxNews.com
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ObamaCare beginning to
crumble?
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ObamaCare's tax surprise
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Key piece of ObamaCare set to miss major deadline
Parts of ObamaCare are starting
to fray, even before full implementation.
The Obama administration now
says a special system of exchanges designed to make it easier for small
businesses to provide insurance will be delayed an entire year -- to
2015.
"Lots of small businesses
struggle with providing insurance for their workers so this was supposed to
facilitate it and make it easier for small business to do this," said Jim
Capretta of the Ethics and Public Policy Center. "It was a huge portion of
the sale job. When they passed the law in 2010 there were many senators and
members of Congress who were saying 'I am doing this because it's going to help
small businesses.'"
The exchanges were designed to
give workers a range of choices supported by dollars from their employers. But
now they will have only one choice until 2015, which could mean they can't shop
for insurance that includes their current providers. Capretta said the
administration is "way" behind schedule.
Since insurance is more
expensive for small businesses, many of which have no obligation under the law
to provide coverage, analysts now fear many might just stop trying and let
workers go on the soon-to-be-launched state exchanges.
Sara Teppema of the Society of
Actuaries -- which did an exhaustive study of ObamaCare -- said that "even
if it's just a small change of people who are leaving the employment-based
insurance and coming into the individual insurance market, their costs and
their numbers will overwhelm those who are currently uninsured."
That means costs would
increase.
Meanwhile, 79 senators including
several liberal lawmakers recently voted to repeal a new tax on medical devices
contained in the health care law following a similar vote in the House.
"The House and the Senate
agreeing? This is a harmonic convergence, it doesn't happen," said former
Democratic Sen. Evan Bayh. "But on this it's happened because the adverse
consequences to our economy and the quality of health care are so
apparent."
The two separate votes have not
become law but show widespread opposition to the 2.3 percent sales tax on
medical devices. Critics say the law is unfair to the industry since it's a tax
on gross sales -- meaning it adds up to a much bigger percentage of a company's
profits.
But supporters such as Paul Van
de Water of the Center for American Progress oppose any repeal.
"I think that repealing
the device tax would be irresponsible. We need the revenue and it's not going
to be a job killer," he said.
The theory was that ObamaCare
would insure 30 million more people and that device makers, like pharmaceutical
companies, would get lots of new customers and a steady stream of new revenue
to make up for the tax. Van de Water predicted that would still happen.
"These device
manufacturers are for the most part going to be getting a large increase in
business thanks to health reform, thanks to ObamaCare," he said.
But the CEO of one company said
that's not true for the 7,000 small companies with 400,000 employees who make a
wide range of devices.
Christine Jacobs of Theragenics
said: "We make widgets -- hips, knees, stents, pacemakers, and implants,
even, for prostate cancer. Those widgets tend to be used by people that are
elderly. As the body parts wear out, we're needed."
But Jacobs notes that most
people whose body parts wear out are already on Medicare, so ObamaCare does not
provide a new revenue stream for her company -- only financial pain.
"In the case of a small
company, that medical device tax is equal to our R-and-D budget for this
year," Jacobs said.
Bayh said in his own state of
Indiana, one company planned to open up to five facilities over the next five
years but had to scrap those plans because of the "uncertainty created by
this tax."
Jacobs said the huge
multinational device makers might be able to handle the burden but not the
small companies.
"It's just such a
disproportionate burden for little guys," she said. "Because we're
all being told that it's the little companies that create the jobs. And that's
not message that we're getting."
The tax will even be applied to
sutures used on pets that Theragenics developed for the veterinary
market.
She sought FDA approval to
demonstrate the quality of her products. But now she said "it's hard for
me not to get frosted on this one" -- she explained that whoever wrote the
regulations said "if you have FDA approval, you will be taxed."
President Obama has vowed to
veto any repeal of the tax, but Bayh notes that 79 votes in the Senate would be
more than enough to override any veto.
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