Department of Defense, Military Construction and Veterans Affairs, and Full-Year Continuing Appropriations Act, 2013

Floor Speech

By:  Ron Johnson
Date: March 13, 2013
Location: Unknown

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Mr. JOHNSON of Wisconsin. Madam President, I thank the Senator from Oklahoma for his comments.

I came to the floor to voice my support for the Cruz amendment. I want to concentrate on the cost of the health care law, which is why we are asking in this amendment to defund that bill because we simply can't afford it. So much of our budget already is not considered. Frequently, during negotiations on how we stabilize our deficit and our debt situation, there are many items off the table, things such as Medicare and Social Security. As unsustainable as those programs are, they are off the table in terms of negotiation. But if you want to take a look at the problem with the health care law--ObamaCare--it is the fact that it is simply not affordable. I know the name of the bill is the Affordable Care Act, but we simply can't afford it. Basic economics 101 describes the problem, because ObamaCare will dramatically increase the demand for health care. Thirty million more Americans--and let's face it, we all want those Americans to have access to affordable health care--will be accessing health care or trying to, demanding health care through some kind of program, such as Medicaid, while at the same time the supply will be dramatically reduced. That is going to be an economic disaster.

What I wish to do is put up a couple of charts and graphs showing the true cost. We don't talk about the true budget window when ObamaCare fully kicks in in the year 2016. This is based on the CBO estimate, and all we have had to do is extrapolate the final 3 years. Basically, it shows that ObamaCare won't cost the $1 trillion it was originally estimated to cost when it is fully implemented between 2016 and 2025. It will actually cost $2.4 trillion, at a minimum. And, of course, it will be paid for by these taxes, fees, and penalties, which I guess now are taxes, equaling about $1.4 trillion.

So given the $2.4 trillion worth of cost, we have $1 trillion worth of taxes--and, by the way, the majority of those or a great portion of those taxes will be indirect on middle-income Americans--that leaves about a $1 trillion hole in the current budget window. That is the $716 billion that will apparently be taken out of Medicare providers. We are not sure what will be happening in the full budget window, but that is a $1 trillion deficit risk.

Again, these are all estimates, and I would argue in general that the Federal Government is not particularly good at estimating anything. Back when they first passed Medicare in the mid 1960s, they projected out 25 years and said Medicare would cost $12 trillion in 1990. In fact, it cost $110 trillion--over nine times the original estimate. I don't believe the Federal Government has gotten better at estimating in that intervening time period.

As a matter of fact, President Obama famously repeatedly said that if we passed a health care law, by the end of his first term the cost of a family plan would actually decline by $2,500. Unfortunately, that guarantee has not come true. When President Obama took office, the average cost of a family plan was a little over $12,000. If his promise had come true, we would be looking at a family cost of $10,000. In fact, the cost of a family plan today is now $15,000. Again, that is somewhat of a broken promise.

But let's take a look at what I think is the greatest risk in terms of cost projections by the CBO in that estimate of the total cost of ObamaCare--the $2.4 trillion we are talking about in the true budget window. The CBO estimated only 1 million people net would lose their employer-sponsored care and get dumped in the exchanges with the subsidies. But it is going to be far worse than that, because 160 to 180 million Americans access their health care through their employers. I was one of those employers. I purchased health care for more than 31 years. The decision employers are going to be making in terms of whether to carry health care has dramatically changed under the health care law. Now the decision is going to be: Do I pay $15,000 for a family plan and then try to comply with the now 20,000 pages of law--rules and regulations?

Leader McConnell printed out those 20,000 pages. You can see it in the hallway. It is an enormous burden for anybody trying to comply with that.

Anyway, the decision is: Do I pay $15,000 trying to comply with 20,000 pages of rules and regulations or do I pay the $2,000 to $3,000 fine--the penalty--and in so doing I am not exposing my employees to financial ruin, I am making them eligible for huge subsidies in the exchange? If an individual has a median household income of $64,000, they will be eligible for $10,000 in those exchanges--$10,000 worth of subsidies. Who isn't going to take that deal?

And that is my point. As employers, we will drop coverage. Employers are incentivized to do so. So rather than 1 million Americans losing their employer-sponsored health care and enjoying those subsidies, there will be tens of millions.

One of the amendments I will be offering in this budget process will be asking the CBO to provide the worst-case scenario: What happens if the McKinsey study is true, 30 percent of employers will drop coverage or 50 or 100 percent? It will be a simple amendment to get the worst-case scenario.

With that, I yield the floor.

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