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What President Obama Won’t Tell Women About His Health Care Law

May 9, 2013

At the health care law’s March 2010 signing ceremony, President Obama predicted that “all of the overheated rhetoric over reform will finally confront the reality of reform.” Three years later, the American people are faced with the reality of President Obama’s health care law. Rather than admit his law costs too much and fails to work the way he promised, President Obama just keeps trying to sell it.

The White House will hold an event on Friday to promote the law’s benefits for women ahead of Mother’s Day. The President desperately wants people to focus on what he sees as the good parts of the law and ignore the bad. As one columnist put it, “the top Democrat insists that the train is chugging along and all the passengers are happy travelers.” President Obama may want to act like everything is fine. It isn’t. Here’s what the President isn’t saying about how his health care law hurts women, and why it’s a terrible Mother’s Day gift.

Women are taxed more if they choose to get married. Economists say the health care law’s perverse incentives actually encourage women to stay single rather than marry. One of the biggest tax hikes in the law affects the portion of payroll taxes used to fund the Medicare Hospital Insurance Trust Fund. This year, the health care law increased the Medicare HI payroll tax from 2.9 percent to 3.8 percent on wages higher than $200,000 for individuals and $250,000 for couples. This amounts to $317.7 billion in new federal revenue. One tax expert called the policy a “shockingly inequitable marriage penalty.” For example, let’s say a single man and a single woman each earn below the individual threshold per year. Neither is required to pay the health law’s additional Medicare payroll tax. If those two people marry, however, they easily could break the marriage threshold and owe thousands in additional taxes.

Women who want to marry could lose extra help to buy insurance. Because the health care law links taxpayer subsidies to the federal poverty guidelines, couples may find that marriage means their health insurance will cost more. Government subsidies shrink – and so premiums grow – as income rises. For example, two singles can each make $45,960 per year (400 percent of FPL) and still qualify for government subsidies. If the two marry, and combined income hits $91,920 per year, then they lose the government subsidy. A single mother who earns $46,530 per year (300 percent of FPL) – mother and child get a subsidy to buy health insurance. If the mother decides to marry the child’s father, who earns a $45,960 per year salary (400 percent of FPL), then the family no longer qualifies for the subsidy help. This is true even though the mother and the father each qualified for subsidy help as singles. The mother would be left to carry the full weight of the law’s more expensive, government-mandated insurance for herself and her child.

The law’s employer mandate tax will hurt women and younger workers. The President’s health care law imposes a tax on businesses that do not offer health insurance to their workers. Beginning in 2014, businesses that employ 50 or more full-time workers will be taxed $2,000 per employee (after the first 30) if they don’t provide government-approved health insurance. The employer tax creates an incentive to use part-time workers or independent contractors. The non-partisan Congressional Budget Office noted that the law’s new tax on employers “will, over time, generally be passed on to workers through reductions in wages … However, firms generally cannot reduce workers’ wages below the minimum wage, which will probably cause some employers to respond by hiring fewer low-wage workers.”

Another study found that 33 percent of uninsured workers earn within $3 of the minimum wage. These low-wage workers are put at high risk of unemployment if their employers are required to offer health insurance. Workers at highest risk are more likely to be high school dropouts, minorities, and female.

Women will see premiums skyrocket for their young adult children. The health care law allows young adults to stay on their parents’ health insurance plan until the age of 26. But what will these young people do when they turn 27? A study published by the American Academy of Actuaries found the health care law greatly increases the cost to buy insurance in the individual market. Young people between the ages of 27 and 39 will be particularly hard hit – single young adults making about $25,000 per year will face a 42 percent premium hike.  

Women are more likely to lose employer-sponsored insurance than men. CBO estimates the President’s health care law will cause eight million people to lose the employer-sponsored coverage they have today. Women are less likely to be insured through their own job; rather they are more likely to be covered as a dependent (23 percent for women vs. 14 percent for men). This means a woman is much more vulnerable to losing her health insurance if widowed, divorced, or her spouse loses a job. Benefits experts say the health care law may actually encourage employers to drop spousal coverage to hold overall costs down. The employer could also raise dependent-coverage rates to unaffordable levels. According to the Wall Street Journal, the people being dropped from employer sponsored plans “tend to be women.” This trend will accelerate in 2014 once the health care law’s exchanges open.

Two-thirds of all adult Medicaid patients are women. Women depend on the Medicaid program, but a government Medicaid card does not ensure female patients access to high quality medical care for themselves or their child. One struggling mother told the Wall Street Journal: “You feel so helpless thinking, something’s wrong with this child and I can’t even get her into a doctor.” Another survey found that one-third of physicians nationwide were unwilling to accept new Medicaid patients. Other studies conclude that some patient outcomes in the Medicaid program are even worse than those for the uninsured.

In his relentless sales job, President Obama is not playing straight with the American people. All of the “free” stuff he is promising is not free; it is, as Secretary Sebelius has said, shifted to other members of a family. The reality of his health care law train wreck is already hitting the American people hard, and it’s only going to get worse. Whether the President admits it or not.

Health Care Headlines

Reuters: “Analysis – Big insurers wary of entering new Obamacare markets”: The nation's largest health insurers are far from leaping at the chance to join new state health insurance exchanges under President Barack Obama's reform law, making it likely that some markets will have little or no competition next year.

The Hill: “GOP: Obamacare compliance burden nears 190 million hours”: Complying with President Obama's health care law will take nearly 190 million hours per year, according to a new tally released by House Republicans.

The Wall Street Journal: Op-Ed: “Ezekiel Emanuel: Health-Care Exchanges Will Need the Young Invincibles”: In less than five months, the Affordable Care Act's insurance exchanges will go live online. As the opening day gets closer, anxiety is increasing over how well these online exchanges will function.

Real Clear Markets: Op-Ed: “For An Obamacare Preview, Look To England”: British newspapers are filled with the pros and cons of the National Health Service, which provides free or heavily subsidized care to all registered residents. The latest story is that British hospital emergency room visits are rising, from 18 million in 2005 to 22 million in 2012. Higher emergency room use is relevant to America, because supporters of the Affordable Care Act often justify its passage on the grounds that it will reduce the number of hospital emergency room visits, thereby lowering the national costs of health care.

USA Today: “Next year heralds major changes in nation’s health care”: Within the next 12 months, consumers could get a quick check-up at the pharmacy, text glucose levels to a doctor through a smart-phone app, or earn bonuses for treadmill time from their employer – all as the nation grapples with growing health care costs.