Is Private Insurance going to be outlawed

The current House health care bill would make individual private medical insurance illegal and obliterate the market for individual coverage, opponents warn.

Investor's Business Daily reviewed H.R. 3200, a 1,018-page bill, and sought help from the House Ways and Means Committee when it stumbled upon the following segment listed under "Protecting the Choice to Keep Current Coverage," in the "Limitation on Enrollment" section on Page 16:

"Except as provided in this paragraph, the individual health insurance issuer offering such coverage does not enroll any individual in such coverage if the first effective date of coverage is on or after the first day" of the year the legislation becomes law.

"So we can all keep our coverage, just as promised – with, of course, exceptions: Those who currently have private individual coverage won't be able to change it. Nor will those who leave a company to work for themselves be free to buy individual plans from private carriers," Investor's Business Daily reported.

Section 102(a)1(A)

Opponents of the health care plan have argued that government-subsidized coverage will mean the death of the private insurance market.

IBD warns that employers may stop providing private plans and instead opt for Washington's coverage when tempted by a public option that is 30 percent to 40 percent cheaper than existing premiums.

According to the report, The Lewin Group has estimated that 120 million or more may lose group coverage at their places of employment and be forced to accept the government option – leaving private insurance companies with less than 50 million customers.

"What wasn't known until now is that the bill itself will kill the market for private individual coverage by not letting any new policies be written after the public option becomes law," IBD states. "The legislation is also likely to finish off health savings accounts, a goal that Democrats have had for years. They want to crush that alternative because nothing gives individuals more control over their medical care, and the government less, than HSAs."

With health savings accounts out of the picture, the daily warns that welfare state expansion is imminent.

"The public option won't be an option for many, but rather a mandate for buying government care," IBD states. "A free people should be outraged at this advance of soft tyranny."

The report blasts Washington, saying it "does not have constitutional or moral authority to outlaw private markets in which parties voluntarily participate. It shouldn't be killing business opportunities

Likewise, the National Center for Policy Analysis, a nonprofit, nonpartisan public policy research organization, called the health care "reform" bill a "nightmare."

"Americans who desperately need health care relief won't get it in this bill," said NCPA President John Goodman in a statement. "This legislation is going to create a financial and medical nightmare for Americans. Of course, members of Congress will be able to hold on to their Cadillac health care plans because this reform won't apply to them."

Goodman warned that employers will be forced to pay the government for health "reform" – either by buying government-approved insurance for workers or by paying a tax and sending employees over to the Medicare-like plan.

"This bill has all the bad ideas from previous versions, plus a cost of one trillion dollars, and no long-term solutions that will control costs or improve quality," added Goodman. "This bill contains 1,018 pages of new regulations that will require you to buy as much health insurance as the government mandates, even before you buy groceries, gas, or pay your rent. If you don't buy government-approved insurance, you will be taxed."

Sen. Edward Kennedy

The NCPA is supporting a national petition called "Free Our Health Care Now" that will be delivered to Congress. It currently has 400,000 signatures.

The Senate health committee approved a similar health proposal, dubbed "The Affordable Health Choices Act," Wednesday.

"I could not be prouder of our Committee, "Chairman Edward Kennedy, D-Mass., declared. "We have done the hard work that the American people sent us here to do. … [W]e must continue to search for solutions that unite us, so that the promise of quality affordable health care for all can be fulfilled."

Sen. Chris Dodd, D-Conn., also touted the act, saying, "We began this process with a blank sheet of paper and a mandate from the American people. … This time, we have produced the legislation Americans wanted. This time, we have delivered on the promise of real change."

Human Events writer Ross Kaminsky dubbed the Senate bill "an equal disaster" to the House version. Kaminsky outlined the following details of the House bill, referring to it as "the largest tax hike in American history":

• Imposes the following income surtaxes: An additional 1 percent for Americans making more than $280,000 or families earning more than $350,000; 1.5 percent for family incomes over $500,000 (individuals over $400,000); and 5.4 percent for family incomes over $1,000,000 (individuals earning over $800,000). According to the Tax Foundation, the plan "pushes top tax rates over 50 percent in 39 states."

• If (when) the government does not find that "Federal health reform savings" have saved at least $150 billion per year by the end of 2012, the first two surtaxes increase to 2 percent for families making over $350,000 and 3 percent for families making over $500,000.

• Creates a "tax on individuals without acceptable health care coverage" of 2.5 percent of income in excess of the filer's exemptions (essentially $3,300 for a spouse and for each dependent).

• Penalizes employers "8 percent of the average wages paid by the employer" during the relevant time period if the employer does not offer acceptable coverage, with an exemption for companies with annual payroll under $250,000, going up by 2 percent increments every $50,000 of payroll to reaching 8 percent at $400,000. Rep. Paul Ryan, R-Wis., has concluded that this provision alone will kill 5 million American jobs.

• Subsidizes families with income up to 400 percent of the Federal Poverty Level, i.e. up to $88,000 of income for a family of four.

• Offers these subsidies to many or most non-citizen legal immigrants.

• Create an advisory committee of people who have expertise in health care, whether as providers, market analysts, administrators, educators, etc., but which must include at least one representative of a union.

• Is reported as being expected to cost $1 trillion over 10 years, but that cost substantially understates the cost of the bill because spending doesn't ramp up until 2012. According to the CBO's initial analysis (text here), the cost in 2019 is expected to be over $200 billion net of penalties assessed against employers, with an average subsidy of $6,000 per subsidized enrollee. And the CBO admits that its estimate does not "fully capture" parts of the plan.

According to the results of a Rasmussen Poll released today, 78 percent of voters say it is at least somewhat likely that taxes will be raised on the middle class to cover the cost of government health care while 56 percent say it is very likely.

The New York Post published this chart showing what government health care means to New Yorkers:

Republican staff members of the Joint Economic Committee created the following chart to illustrate the bureaucratic red tape between patients and their doctors under the House Democrats' health plan (click to see enlarged version on Dr. Orly Taitz' website):