Snap Fact #293
President Obama Gave Us ObamaCare - GOP False Claims Ring Hollow!

You hear it from Governor Romney on the stump. You hear it from Fox News and the rest of the right wing media in their interviews, their commentary, and their “news” reports. It doesn’t seem to bother any of them that they have no inhibitions about consciously repeating what they know to be one lie after another.

Arguably, one of the most egregious lies is that President Obama is taking $700 billion out of Medicare to fund ObamaCare. This statement is not only a lie – it is the complete reversal of the truth, and Paul Ryan and the other prevaricators are very aware that this is a made up fact that has been culled from a half-truth stood on its ear and fashioned into something completely the opposite of the reality.

Simply put, the Affordable Care Act (ObamaCare) is the law of the land. For better or for worse, it was passed by the United States Congress. One positive provision of ObamaCare is the about $700 billion has been saved by the elimination of waste, fraud, and overpayments. This is a good thing, no? Even better, the President saw to it that most of this money will be applied to closing the donut hole and other reforms that will put significant dollars into the pocketbooks of seniors.

Ironically, Paul Ryan casually omits that his financial plan retains the existing $700 billion savings wrought by the Affordable Care Act – and the Ryan plan directs that sum to offset additional tax cuts for the wealthy. Compare these facts to the Republican oratory and it is clear that what they say and what they mean to do are mirror opposites. Let’s look more deeply some other aspects of this issue:

Health care spending has consumed an increasing share of economic activity over time. Health care grows faster than most other sectors of the economy and thus its share of economic activity has increased year by year. The United States spent $2.6 trillion on health care in 2010. Spread over the population, this amounts to $8,402 per person. The Obama administration's Affordable Care Act (ObamaCare) is designed to bring health care costs under control. Passed in 2010, the law is also meant to help more people get affordable health insurance coverage, including an estimated 50 million uninsured today.

The median U.S. family income is about $50,000. Employer subsidized family health coverage can easily run to $20,000 a year. That shared cost represents an insurance premium paid to a private company in exchange for health insurance. It is obviously not a tax paid to the government. At first glance, the example above may seem to show that 40 percent of the median employee’s income goes to health coverage. In reality it’s much less because the employer’s share is a benefit to the worker, rather than salary.
The GOP propaganda machine took the opportunity to mischaracterize and broadcast the mandate as a 40% tax increase on the family. They say that this phantom tax increase “is required by law”!
  • Rush Limbaugh called the law "the largest tax increase in the history of the world."
  • In a column on Forbes.com, a similar opinion was written by Merrill Matthews of the Institute for Policy Innovation, a think tank founded by Tea Party honcho and former Republican U.S. Rep. Dick Armey of Texas.
  • The health care law "imposes the largest tax increase in history on the middle class.” echoed super-PAC American Commitment, which is quoted from its website that it supports "free markets, economic growth, constitutionally limited government, property rights, and individual freedom." As a 501(c)4 it doesn’t have to disclose its donors.
Part of the act, the individual mandate, will require nearly all Americans to buy some form of health insurance beginning in 2014 or face a financial penalty. The individual mandate will help spread health care costs amongst a larger pool of individuals, thus potentially lowering costs. The ACA creates state-based Health Insurance Exchanges administered by a governmental agency or non-profit organization, through which individuals and small businesses with up to 100 employees can purchase qualified coverage.

In 2014 and beyond, most Americans who work for small businesses or obtain their coverage in the individual health insurance market will do so through health insurance exchanges. There will be no penalty for those who can't afford insurance, including those who don't make enough to file federal taxes or whose insurance premiums will cost more than 8% of their household income. Workers who earn less than 400% of the federal poverty level will get subsidies if they don't have employer-provided insurance. Those who aren't exempt or who don't have employer- or government-provided insurance and refuse to buy their own will begin to pay fines in 2014. Those fines will be due with income taxes the following April.

Look, ObamaCare is not perfect, but on balance it is a first step forward. Presidents of both parties have been trying unsuccessfully to get a health care bill past one reluctant Congress after another for decades. To the President’s credit he massaged an imperfect bill through Congress as a first step towards real universal health care. Along the way, almost every Republican and a small number of Blue Dog Democrats did whatever they could to poison the Bill, and they succeeded to a large extent.

With that said, the Bill that finally emerged has so many good points, such as saving $700 billion in unnecessary expenses and using the money to help seniors, that it is a good starting point. Give the President a second term and give him a Democratic Congress and we will see significant reform and improvement of this vital Bill.