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February 05, 2010


Democrats’ Health Bills Dangerous to Your Financial Health

Taxpayers and Privately Insured Both to Pay More


A new report by the Obama Administration’s own actuaries in the Department of Health and Human Services (HHS), published in Health Affairs, details two troubling and unsustainable trends in health care spending:

  1. National Health Expenditures will continue to skyrocket over the next decade, far outpacing growth in the economy, and
  2. Taxpayers will soon pay for a majority of all health care services as a result of growing government health care programs.* 

WARNING: Health care spending is growing at an unsustainable rate and Democrats’ health bills make the problem worse.

The new report found that health spending as a percentage of the economy is expected to grow from 16.2 percent in 2008 to 19.3 percent by 2019. These same Obama Administration actuaries, in a separate analysis of House and Senate Democrats’ health legislation, found the Democrat bills would actually exacerbate this problem by increasing national health expenditures over current law. In other words it would bend the cost curve upwards.**

WARNING: Taxpayers to soon pay for majority of health care, and Democrats want to further expand taxpayer-funded government health programs.

The HHS experts also found that by 2012, taxpayer-funded spending for government health care programs will exceed spending by private insurance and will continue to constitute the majority of health care spending in the United States throughout the next decade, something never seen before. The House Democrats’ health bill would create a new government-run health insurance plan and significantly expand Medicaid, further entrenching the federal government as the primary payer for health care.

WARNING: Democrats’ health care bills will increase the cost of private insurance.

It has been well documented that when the government runs health programs, whether it be through Medicare or Medicaid, it significantly underpays for those services. Physicians and hospitals are then forced to recoup their losses from the government by increasing prices for those with private health insurance. For example, a December 2008 Milliman study found Medicare and Medicaid underpayments already drive up the cost of coverage for the average family of four by $1,788 in 2009. By further expanding government health programs Congressional Democrats would worsen this trend of increasing costs for private insurance until it is not affordable to anyone. 

* Christopher J. Truffer, Sean Keehan, Sheila Smith, Jonathan Cylus, Andrea Sisko, John A. Poisal,
Joseph Lizonitz, and M. Kent Clemens,
Health Spending Projections Through 2019: The Recession’s
Impact Continues
, Health Affairs (February 4, 2010).
** Richard Foster, 
Estimated Financial Effects of the “America’s Affordable Choices Act of 2009” (H.R. 3962), as passed by the House on November 7, 2009, CMS Office of the Actuary (November 13, 2009).