Tuesday, February 04, 2014

So "Obamacare" will reduce working people's income...

You know sometimes I wonder how much analysis of "Obamacare" I should believe. It's certainly a laudable goal to make healthcare more accessible financially by many people. The only question is a matter of how.

The President got dinged for his statement on if you like your coverage you can keep it. And then he got dinged on the awful roll-out last year. It's probably on many fronts that he got dinged for how this was managed.

This article by Byron York via Instapundit shows another was "Obamacare" was dinged:
Brookings scholars Henry Aaron and Gary Burtless sought to determine the law's impact on income in 2016, when almost all of Obamacare will be in effect. To do so, they adopted a broad definition of income -- not just a person's wages, but also pension income, employer health coverage, government cash transfers, food stamps, other benefits, and now, subsidies from Obamacare.

They found quite an impact. "The ACA may do more to change the income distribution than any other recently enacted law," Aaron and Burtless wrote. Obamacare provides billions in subsidies to those who qualify, expands Medicaid benefits, cuts Medicare, fines those who don't purchase government-approved coverage and levies new taxes -- all of which will change how much income millions of Americans bring in each year.

Aaron and Burtless' first finding is no surprise: Obamacare will mean more for the lowest-income Americans. It will increase income by 9.2 percent for the lowest bracket — households making below about $21,000 a year — for those in their working years, age 25 to 64.

Then the surprise. Obamacare will reduce, by an estimated 0.9 percent, the incomes of working-age Americans in the next-lowest income bracket, households making between about $21,000 and $40,000 a year. And in the next income group, households making between about $40,000 and $65,000 a year — Obamacare will reduce their income, too, also by 0.9 percent.

A 1 percent reduction in income is relatively small. But it is still a reduction -- and not at all what President Obama and Democrats in Congress promised. When the president pledged that Obamacare would make the health care system "better for everybody," it's doubtful Americans interpreted that as meaning it would reduce their income.
Why? There could be a number of factors, but the authors suggest that because the Affordable Care Act will make health care more expensive, a significant number of people who receive health coverage through their job will be affected. "Incomes fall ... primarily because the expansion in employer-sponsored insurance is predicted to cause a modest drop in money wages as employers devote a larger share of their compensation payments to health benefits," the researchers wrote.
Like I said, I'm not entirely certain how much of this to take to heart or not. What's acceptable to me is that the Affordable Care Act is a significant change that unfortunately isn't going away so easily. Unfortunately we will have to continue to deal with the fallout of the significant provisions of this significant piece of legislation.

Another piece of analysis, "Obamacare" discourages able-bodied people from working. This almost feels like piling on!

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