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Sunday, July 18, 2010

Moral of the Obamacare Story: Taxes In, Doctors Out

There were two important developments recently in the continued unraveling of the Obamacare public relations BS.

First, the Obama administration cemented its legal position that the health care mandate is a tax, which means that Obama is raising taxes on people making less than $250,000 a year contrary to his campaign promise.

Second, the promise that you could keep your doctor is evaporating as health insurers, in a desperate attempt to keep down premiums under the burden of Obamacare requirements, are reformulating their plans by limiting choice of physicians.

Read Obama's Tax Lips

Read Obama's lips: I will not raise taxes on anyone making less than $250,000 per year.

Read Obama's lips: The health care mandate is not a tax, so even though people making less than $250,000 per year have to pay it, I have kept my promise.

Read the Obama administration's legal defense of the mandate:
When Congress required most Americans to obtain health insurance or pay a penalty, Democrats denied that they were creating a new tax. But in court, the Obama administration and its allies now defend the requirement as an exercise of the government’s “power to lay and collect taxes.”

And that power, they say, is even more sweeping than the federal power to regulate interstate commerce.

Administration officials say the tax argument is a linchpin of their legal case in defense of the health care overhaul and its individual mandate, now being challenged in court by more than 20 states and several private organizations.

You see, it all depends on what the meaning of "is" "tax" is.

He will say anything, because he doesn't really care whether it is a tax or not.

He just wants to force you to pay it.

You Cannot Keep Your Doctor, Sucker

Read Obama's lips: You will be able to keep your doctor if you want to.

Reality is that Obamacare imposes so many requirements on health care insurance that costs must rise or companies will go out of business. In order to qualify as acceptable insurance, and to avoid the health care mandate penalty, patients must obtain insuance with coverage they may not need or want.

There is no free lunch. Either health insurance premiums must rise, or coverage must fall. But since coverage cannot fall due to Obamacare requirements, the only place left to cut is in access to physicians:
As the Obama administration begins to enact the new national health care law, the country’s biggest insurers are promoting affordable plans with reduced premiums that require participants to use a narrower selection of doctors or hospitals.

The plans, being tested in places like San Diego, New York and Chicago, are likely to appeal especially to small businesses that already provide insurance to their employees, but are concerned about the ever-spiraling cost of coverage.

But large employers, as well, are starting to show some interest, and insurers and consultants expect that, over time, businesses of all sizes will gravitate toward these plans in an effort to cut costs.

The tradeoff, they say, is that more Americans will be asked to pay higher prices for the privilege of choosing or keeping their own doctors if they are outside the new networks.

That could come as a surprise to many who remember the repeated assurances from President Obama and other officials that consumers would retain a variety of health-care choices.

Welcome to Obamacare, one big freakin' HMO.

Moral Of The Story

Yes, we will raise taxes on people making under $250,000 per year, and no, you cannot keep your doctor.

Related Posts:
The Guns & Tobacco Mandate
Obamacare's Chickens Coming Home To Roost Already
Freedom So Willingly Relinquished

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  1. Most Americans probably do not know this because we do not have a fully functioning news-media. Only those of us "plugged into" the web know these things but it doesn't filter down to most Americans, who do not read alternative web media.

    Secondly, it proves again that our country is being ruled by an elite political class, that cares very little about public opinion and in fact, has contempt for the public, so it may not actually matter what we think anymore. Even the GOP will likely not contend Obamacare anymore.

  2. The DoJ lawyers are advancing the arguments they can to defend against the lawsuits. That's not only not surprising, it's their ethical duty as attorneys.

    And, if they're right about the tax argument, it's game over for the legal challenges to ObamaCare

  3. @Doug - "ethical duty" to advance an argument which is contrary to the congressional record and findings in the law itself? More from the NYT story: "Congress anticipated a constitutional challenge to the individual mandate. Accordingly, the law includes 10 detailed findings meant to show that the mandate regulates commercial activity important to the nation’s economy. Nowhere does Congress cite its taxing power as a source of authority. . . ."

    It may not be "unethical" for the lawyers to advance the argument, but that does not dimish the hypocrisy and misleading rhetoric of Obama.

  4. Obama breaks another big promise....?

    Gee..didn't see that coming.

  5. @William,

    Understood, but if the law can logically be defended on grounds other than those cited by Congress I don't really see that the DoJ is prevented from making the argument to the Courts.

    What you're bringing up, of course, is a political argument rather than a legal one. While I agree wholeheartedly, and while Obama should pay a political price for all of this, I am even less confident of the success of these ObamaCare lawsuits now than I was in March.

  6. Peasant Citizen,

    You don't care how your passport or driver's license is issued, so why do you care so much about how your doctor is issued to you?

    This is all for the greater good. We have a much broader understanding of these issues than you do. You think of yourself as a benefit. Realistically, you are also a cost, and a very big cost as you age.

    You are going to die anyway, so why impose such a large cost on the rest of us as you do it? You complain that it is "your money", but be realistic. Others can do so much more with it than you can. Think of the children and all of the other future voters.

    Don't bother replying to this message. We have gathered the information we need in an efficient and scientific way. This does not include reading your misspelled and ungrammatical letters. Spare us.

  7. Doug, are you suggesting that the courts will simply disregard the Congressional Record? Obviously, I can't say whether they will or will not, but I think it's safe to say that this would set a very dangerous precedent, especially in a case this important, involving one-sixth of the economy. If allowed to stand, Congress would have a new incentive to simply pass massive legislation under seemingly innocuous political pretenses (i.e. under the commerce clause, as here) and then cases would later be defended under entirely different, more onerous, legislative justifications (taxation powers) created-- not by the legislative branch, mind you-- but by DOJ attorneys, after the fact.

    If so, why even bother keeping a Congressional Record?

    As judicial examination of legislative intent has always been an important factor (and in many cases, the deciding factor) in Constitutional Law cases, how are the courts to determine a case, for example, under strict scrutiny, or even under rational basis review, if they incentivize a means for Congress to pass laws with simply no stated, defendable intent in the record? And what is the purpose of Congress, for that matter, if the DOJ would essentially be usurping the role of creating that legislative intent?

  8. I think this signals how weak the defense of Obamacare really is, Professor Jacobson. And then there's the 16th Amendment.Is it satisfied by stripping a House tax bill on TARP of everything and substituting the healthcare language the senate adopted?
    I don't think so.

    But why sweat this, why not just set up offshore private clinics and hospitals. All those fat cats who contribute to the Dem party and rake off govt largesse will be flying over to avail themselves of our services.

  9. "The DoJ lawyers are advancing the arguments they can to defend against the lawsuits. That's not only not surprising, it's their ethical duty as attorneys."

    Ethical and DOJ lawyers can be used in the same
    sentence? You've got to be kidding.

  10. AG,

    They don't need to disregard the Congressional Record at all. If the individual mandate can be justified as an exercise of the taxing power under the General Welfare clause, there's nothing that would prevent the Court from finding it.

    Note, however, that there's very little in Commerce Clause precedent that would prevent the Court from accepting that interpretation as well.

    In short, unless you think that the Supreme Court is going to over rule 75+ years of precedent, there's little reason to believe that ObamaCare will be found unconstitutional.

    As much as I think they should do so, I very seriously doubt that they will.

  11. Doug, I think that for a court to impute that the individual mandate is justified as an exercise of the taxation power, where there is absolutely no indication of that intent anywhere in the Congressional Record (not to the mention the fact that it is not even termed a "tax") would presume a pretty activist interpretation of the law. The courts would essentially be stepping in the shoes of the legislative branch. Further, you have the Executive Branch expressly denying that the mandate is a tax in the public record (Obama's interview with Stephanopolous), and then after the laws' passage, the Executive Branch through the DOJ then arguing the exact opposite and in the process sweeping aside the Legislative Branch and creating an entirely new purpose and effect of the law (under the tax argument). It amounts to the Executive Branch effectively re-writing the law. As this is one of the most important laws in our history, I would hope that the courts would want to see something in the Record demonstrating that this is supposed to be a tax, or not.

    Also, I fail to see how this is raising "revenue" for the Government, when the monetary amounts are going to non-governmental, private practice doctors, etc.

    As for the commerce clause argument, I don't think that this issue is by any means settled by "75+ years of precedent" as the case involves compelling an individual to purchase something, which of course is substantively different than the earlier cases.

    And further, for Congress to have given up its power to regulate commerce in certain states by allowing numerous carve-outs for individual states that would not be subject to certain provisions of the law, cuts against the commerce clause argument for me.

  12. Explain it to me like I'm a 5th grader: If the underlying activity being mandated (purchasing a health insurance policy) has no constitutional basis, how can the penalty for noncompliance be constitutional?

    I'm not convinced that this 180 on terminology makes the cut, constitutionally. There is no basis for the individual mandate within the Commerce Clause, as the federal government does not allow purchase of out-of-state policies, and last time I checked, Congress had authority to regulate commerce BETWEEN the states, not within individual states.

    Furthermore, I seem to recall an "inconvenient" little tidbit mandating that direct taxes be imposed in proportion to enumeration of the population, with the exception of INCOME taxes as per the 16th Amendment. I'm not feeling this one, either, since this "tax" (or penalty or fee or whatever they call it this week) is not based on population but on individual activity, nor is it an INCOME tax since it can be levied on anyone regardless of whether they have an income or not, merely because they choose not to buy a product.

    Someone help me out here, huh?