Despite massive inflation, President Biden and Congressional Democrats can’t stop spending. Democrats’ irresponsible increase of Obamacare subsidies is causing inflation in the health care market. This will increase prices and make it far more difficult for employers to offer affordable insurance coverage.
In Case You Missed It via The Hill, an op-ed from Brian Blase, Ph.D., who is testifying at today’s Education and Labor Committee subcommittee hearing on how increasing Obamacare subsidies over-burdens taxpayers and increases health care costs.
Poll after poll shows that Americans’ top concern is high inflation. Inflation, which most harms low-income families and seniors on fixed incomes, is largely attributable to President Biden’s spending binge.
Despite the death of the Build Back Better Act, Biden is aiming to resurrect failed big-spending proposals that would increase health care prices and prices throughout the entire economy.
First, Biden is proposing to permanently increase ObamaCare subsidies that limit what households pay for a benchmark ObamaCare plan. This structure contributes to health inflation by making enrollees insensitive to premium increases. Health insurers can raise prices, with taxpayers picking up the tab.
Last year’s American Rescue Plan (ARP) Act worsened ObamaCare’s inflationary subsidy structure in two ways. First, it increased the taxpayer share of the premium. Second, it removed the income cap on subsidy eligibility.
According to the Congressional Budget Office, three-quarters of the expanded subsidies’ cost – about $15 billion a year – went to people who already had coverage. This spending did not increase insurance coverage but did increase inflation.
The expanded subsidies expire at the end of the year. Some congressional Democrats are seeking to make them permanent. This would drive up premiums and prices for health care as well as for other goods and services. These higher costs would harm both taxpayers and most people with private coverage since they don’t qualify for such lavish subsidies. Policymakers should reform ObamaCare’s subsidy structure, rather than expand it.
