WASHINGTON – Republican leaders said Sunday that last week's Supreme Court decision upholding President Obama's health care law will backfire on Obama and Democrats, in large part due to Chief Justice John Roberts' ruling that a penalty on Americans who did not buy health insurance was legal because it was a tax.
AP
McConnell: Vows to repeal.
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"The American people," said House Speaker John Boehner, R-Ohio, "… do not want the government telling them what kind of insurance policy they have to buy, and how much they have to pay for it, and if you don't like it we're going to tax you."
Sen. Mitch McConnell of Kentucky, the Senate's top Republican, said he would strive to repeal the law, calling it the "single-worst piece of legislation" in modern times.
White House chief of staff Jack Lew said the mandate would affect only 1% of Americans, the people who can afford to buy health insurance but don't.
Supporters of the law, such as Ron Pollack, director of Families USA, say while some Americans will pay taxes to shoulder some of the law's costs, most Americans will not.
Americans already pay up to $1,000 a year in higher health insurance premiums to cover the costs of the uninsured, Pollack said. The tax only affects families making $250,000 a year or more a year, and young adults will not see their premiums increase because most fall under the 400% of poverty level that allows them to receive subsidies to buy health insurance.
The penalty or "tax," as Roberts defined it, means that most Americans will be required to buy health insurance or pay $695, or 2.5% of household income, beginning in 2016. The penalty will be phased in, beginning with $95 or 1% of income in 2014.
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The $695 fee is less than what most people pay now because of the uninsured, Pollack said. Health providers don't turn away people who need but can't pay for it. Providers must then swallow the cost of paying for that care, and those costs are passed to other consumers, he said.
Alissa Fox, senior vice president for the Blue Cross and Blue Shield Association of health insurers, said a Joint Committee on Taxation study said premiums for families would increase $350 to $400 a year because of a health insurers' tax.
She said insurers would work to keep those costs down.
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Many of those costs could be limited by other parts of the law, such as benefits to employers who offer insurance and adding more young people to the ranks of the insured, said Mary Grealy, president of the Healthcare Leadership Council, a coalition of chief executives of the nation's leading health care companies and organizations.
Some higher-income Americans will have to pay higher taxes because of the law. Starting in January, individuals earning more than $200,000 and couples earning more than $250,000 will pay a 3.8% tax on investment income. Individuals who earn more than $250,000 and couples that earn more than $500,000 in capital gains on the sale of a primary home will also pay a 3.8% tax on that gain.
McConnell and Lew spoke on Fox News Sunday. Boehner spoke on CBS' Face the Nation.
Those changes might include "opt-out" provisions in insurance, where people are automatically enrolled and have to unenroll, Grealy said. Young people typically have lower medical costs, so adding them to the insurance pool spreads the wealth.
Logan Harrison, Indiana's chief health commissioner, disagrees.
Premium prices for young people will increase between 75% and 80%, he said, because the penalty for failing to buy health insurance will not be enough to encourage young people to buy the coverage. That will leave a pool of older and sicker Americans to pay for and not enough young people to balance the burden.
Fox said average premiums for a 27-year-old are much lower now than they are for a 64-year-old. The law removes age discriminatory language, so everyone will pay more comparable rates.
Contributing: Associated Press
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