On Saturday, the Senate got 60 votes in order to clear a procedural huddle, and begin debate on the Senate reform bill, known as the Patient Protection and Affordable Care Act.
Here’s what needs to happen before anything becomes law:
• First, the bill must pass through the Senate
• Then the House and Senate proposals must be reconciled
• Third, the reconciled bill must pass through the House
• Last, the reconciled bill must pas through the Senate
The CBO ranks the cost of this bill at a whopping $848 billion over 10 years. But as you would suspect, this is not really the true cost of the bill. The bill states that Medicare participating providers will get a 21% payment cut in 2011, which would then carry forward to subsequent years. Politics make this very unlikely to happen, and so you can add another $247 billion to the cost.
To pay for this bill, congress is pretending that they will cut $464 billion from Medicare spending. This, too, is politically unlikely, as Medicare is already struggling to keep participating providers.
The rest of the money will come from taxes on insurance companies (who will pass those cost on to customers), and wealthier Americans (raising the top tax bracket to 45%).
There are $25 billion in unfunded mandates for the state to pay.
As with the House bill, this one has meager penalties for those who don’t carry health insurance, which is the only way the proposed system for guaranteed issued coverage will work, without premiums going up. ($95 starting in 2014, eventually reaching $750).
It is likely the premiums will increase by at least 50%, on average. If the bill is not changed to allow plans like the current HSA-qualified plans held by millions of Americans, then premiums will also go up when people are forced to change to a more benefit-rich qualifying health insurance plan.
There are so many problems it is amazing to think that this bill has a chance of passing. There is nothing to control medical spending; premiums will increase; government debt will increase; the economy will suffer massively, and we will be taking the first steps towards a total government takeover of healthcare.
Debate in the Senate begins November 30.