To pay for the changes, the legislation includes more than $400 billion in higher taxes over a decade, roughly half of it from a new Medicare payroll tax on individuals with incomes over $200,000 and couples over $250,000. A new excise tax on high-cost insurance policies was significantly scaled back in deference to complaints from organized labor.
In addition, the bills cut more than $500 billion from planned payments to hospitals, nursing homes, hospices and other providers that treat Medicare patients. An estimated $200 billion would reduce planned subsidies to insurance companies that offer a private alternative to traditional Medicare.
The insurance industry warned that seniors would face sharply higher premiums as a result, and the Congressional Budget Office said many would return to traditional Medicare as a result.
The subsidies are higher than those for seniors on traditional Medicare, a difference that critics complain is wasteful, but insurance industry officials argue goes into expanded benefits.
The bill requires insurers to charge people with pre-existing conditions the same as everyone else, and the only reason for people not to play the system (dropping their insurance until they get sick and the insurer has to take them) is because the law requires them to buy insurance or pay a fine. For many people, the fine will be a cheap price to avoid premiums that could run around $8,000 a year for a family of four. The effect of the legislation could be to cause the number of healthy people with insurance to fall dramatically — and for premiums to rise, which would cause more people to drop their insurance and premiums will rise, and even less people will be insured…
And so it goes.
Oh, have I thanked you lately for the change you brought to me?
Don’t hold your breath…