Katie LaPotin, Red Alert Politics, July 30, 2013
It’s a no-win situation for the American people, as delaying the implementation of Obamacare an additional year also comes with a hefty price tag.
According to a new report from the Congressional Budget Office released Tuesday, postponing the employer mandate and verification requirements for state-based insurance exchanges – both of which the Obama administration agreed to do earlier this month – will cost the American taxpayers $12 billion.
The reason for this cost: the loss of the “mandate penalty taxes” from employers and from the increased government subsidies for Americans who are seeking health insurance from the changes. The loss of the taxes alone is expected to cost the American taxpayers $10 billion.
“As a result of the Administration’s announcement and recently issued final rules, the net cost is now estimated to be $1,375 billion—$12 billion more than previously estimated,” the report reads.” The largest change is a $10 billion reduction in penalty payments by employers that would have been collected in 2015. (Penalties assessed for 2014 would have been collected in 2015.) Costs for exchange subsidies are expected to increase by $3 billion. Other small changes, including an increase in taxable compensation resulting from fewer people enrolling in employment-based coverage, will offset those increases by about $1 billion, CBO and JCT estimate.”
The report also found that the Administration’s failure to get the healthcare program up-and-running in time for its scheduled January 1, 2014 implementation will also result in one million people losing their employee healthcare coverage in 2014. Because many of these individuals will be able to get government-subsidized healthcare, however, the report believes that ”fewer than half a million people are expected to be uninsured in 2014 than the number projected in the May baseline.”
The CBO isn’t the first federal budgeting office to admit in recent weeks that the implementation of Obamacare comes at a steep price. Last week, the Government Accountability Office announced that healthcare rates will rise for young Americans under the president’s healthcare laws.