As many as 20 million Americans could lose their employer-sponsored coverage in 2019 under the health care legislation signed into law by President Obama in March 2010.
This is the worst-case scenario set out by the Congressional Budget Office (CBO) in a report released Thursday.
The CBO’s most optimistic estimate, which the federal agency says is subject to a “tremendous amount of uncertainty,” is that 3 million to 5 million could lose their employer health coverage each year from 2019 through 2022.
The new projections for loss of employee coverage are a substantial increase over last year’s estimates, when the CBO’s best prediction was that only 1 million people would lose employer-sponsored coverage.
The new study is the latest indication that the health care overhaul will result in a deterioration of health care for the majority of Americans, and not the improvement touted by the Obama administration. Working families and those in low-wage jobs stand to suffer the most from companies eliminating coverage.
As the World Socialist Web Site explained during the administration’s campaign for its health care “reform,” the scheme was the opposite of universal and quality health care for all. Drawn up in close consultation with the insurance, pharmaceutical and hospital industries as well as Wall Street, it was driven by a determination to reduce government deficits and health care costs at the expense of the working class. In addition to cutting hundreds of billions of dollars from Medicare, the government health insurance program for the elderly, the plan is designed to ration health care on class lines
, depriving millions of working people of benefits on which they currently rely.
Beginning in 2014, the Patient Protection and Affordable Care Act (PPACA) will mandate individuals and families to obtain insurance or pay fines that could eventually rise to as much as 2 percent of income for all but the very poor. Those who purchase insurance on the health care “exchanges” set up under the PPACA will be at the mercy of private insurers who can increase premiums without any meaningful government oversight.
Companies with more than 50 employees that stop offering health coverage will be levied a $2,000 per employee tax penalty. The CBO projection indicates that a significant proportion of businesses will find it financially advantageous to drop coverage and pay the penalty.
The CBO’s worst-case scenario is in line with previous studies on the impact of the health care bill on employer coverage. A study released in August 2011 by human resources consultants Towers Watson showed that at least 9 percent of companies planned to drop their coverage by 2014
. A study last June by the McKinsey Company showed that an even larger proportion, 30 percent, were likely to stop providing coverage when provisions of the PPACA take effect.
On the same day the CBO published its report, the Center for Studying Health System Change (HSC) released a national study showing that employer-provided health coverage has already been substantially eroded as a result of the recession. Between 2007 and 2010, the share of children and working-age adults covered by employer-sponsored health insurance dropped by 10 percentage points, from 63.6 percent to 53.5 percent...
...As the CBO report demonstrates, the numbers of those losing their employer-sponsored coverage—whether they are dumped by their employer or can no longer afford it—will rise as a result of the Obama health care overhaul.
This tendency will be exacerbated by the continuing rise of overall health care costs, driven in the main by the spiraling profits of the insurance companies and giant health care providers and pharmaceuticals....