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Op-Ed: Warning: ObamaCare Will Hurt South Carolina

Op-Ed

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By Jim DeMint

Published in the Greenville News on April 16, 2010

President Barack Obama's health-care bill should have come with a caution label for South Carolinians. WARNING: this legislation will explode Medicaid rolls, break the state budget, hike insurance premiums, overcharge students for college loans, make it even more expensive for small businesses to keep up with their paperwork
and kill jobs.

This is the wrong prescription for South Carolina. But the Democrats in Washington didn't have South Carolina's interests in mind when they passed this bill. They were more concerned about giving President Obama a "win" than the deadly side effects it would have on the states. They didn't have to worry about the cost, either.

Unlike the legislators in South Carolina, lawmakers in Washington don't have to balance their budget. They can pass as much debt and spending as they want. Then, South Carolinians must find a way to pay for it with dramatic tax increases or severe cuts to state services.

ObamaCare's required expansion of the Medicaid system showcases this problem. The main way ObamaCare provides health insurance to uninsured Americans is by enrolling millions more people into this already failing, government-run health care program. This will be devastating for South Carolina taxpayers.

The Medicaid system in South Carolina is currently overwhelmed. Before ObamaCare was passed one in every four South Carolinians was already dependent on Medicaid for health insurance and its costs consumed more than 20 percent of the state's annual budget. More than half of all health care providers in South Carolina don't even accept Medicaid patients, either. This is largely because the government's payment rate to doctors is too low to cover the costs of treatment.

Providing adequate payments to doctors is a constant political football in Washington. The Democrats didn't include these costs in their health care bill. Putting money for doctors in the bill would have made the price tag even higher, decreasing the bill's chances of passage. So, the Democrats left doctor pay out, thinking it would be passed another time, as a separate piece of legislation. Meanwhile, thousands of doctors are waiting to be properly paid for their work.

ObamaCare is going to exacerbate this situation by adding 483,000 more South Carolinians to Medicaid, a whopping 61 percent increase in the number of existing participants. Washington isn't going to pay that bill. South Carolina's families and businesses are. This mandated expansion will cost South Carolinians $914 million over the next 10 years -- likely be paid for with higher taxes.

Additionally, South Carolina's 114,000 Medicare Advantage patients will see their benefits cut in half, according to the Congressional Budget Office. President Obama used to say that if you liked your health insurance, you would be able to keep it. That's not true if you are a Medicare Advantage patient.

The bad news isn't limited to Medicaid and Medicare patients. Young Americans will pay higher premium costs. One study has shown that the youngest 30 percent of South Carolinians will pay 35 percent more for their insurance premiums in the individual market. Others who have Flexible Spending Accounts and Health Savings Accounts will be limited in what products they can purchase with pre-tax dollars, face new caps limiting the amount of money that can be saved and pay higher penalties for withdrawing that money for non-medical expenses, as a family might need to do in case of an emergency.

All South Carolinians will be expected to pay in one form or another. ObamaCare's overall price tag will cost $2.6 trillion over the next 10 years. Evenly divided among the nation's 307 million Americans, that amounts to $8,470 for every man, woman and child to pay.

College students will pay some of these costs. Before the health care bill passed a number of private loan servicers were available, but no more. The government shut them down and took over the student loan industry, believing it would be better for Washington to sell the loans and take the profits made on interest. That means nearly 190,000 South Carolina college students will be overcharged on their loans to pay for health care and other government programs.

ObamaCare is also going to impose new compliance costs on small businesses like local restaurants, hotels and shops. In order to avoid paying health care penalties and qualify for a small business health care tax exemption, bookkeepers must prove the business employs 50 or fewer "full-time equivalent" workers, which can include part-time workers. This acts as an incentive to employ less than 50 workers, resulting in fewer jobs. And the hours worked by employees must be tallied each month since penalties for not providing health care insurance can be awarded on a monthly basis. These accounting requirements are further complicated by the fact that many restaurants and hotels grow and shrink their workforce on a frequent basis to adjust to demand between high and low seasons.

Basically, these requirements are like asking small businesses to do their taxes, a stressful and expensive task, each and every month to find out if they have a bill to pay or not.

These are just a few of the sickly side effects to this bill. More unhappy details will be discovered as Americans continue to parse through this 2,700-page bill. That's why I believe ObamaCare must be repealed and Congress should start over with commonsense solutions that will lower the cost of health care for consumers and increase the supply of it.

Real reform begins by making it easier for people to buy insurance on their own, across state lines. Americans who buy their own insurance should be able to get the same tax breaks as those who get it from their employers. Congress must also take action to stop frivolous lawsuits against doctors that drive up costs for everyone else.

If this legislation stands, dwindling benefits for Medicare and Medicaid patients, more expensive insurance premiums, higher taxes and fewer jobs are just the beginning of the adverse reactions ObamaCare will have on South Carolina's families.

Let's consider ourselves warned and repeal this government health-care takeover.


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