Former top Democrat says when Obamacare takes effect, small businesses will drop employee health coverage

Friday, September 23, 2011 by: J. D. Heyes
Tags: Obamacare, health coverage, health news

(NaturalNews) In regard to the health care "reform" measure in 2009, President Barack Obama assured the nation that the 1000-plus page measure was vital -vital- to ensure that all Americans were finally covered by health insurance. In praising its passage in the House, Obama said the measure "will begin the process of fixing what's broken about our health care system, reducing costs for all, building on what works, and covering an estimated 97 percent of all Americans."

That prediction isn't likely to come true, for even a former head of the Democratic Party says not only will millions of Americans lose their preferred coverage after the so-called "Obamacare" legislation kicks in completely, but its price tag is liable to double.

Howard Dean, a physician, onetime Democratic candidate for president and former head of the Democratic National Committee, said this week that when Obamacare takes full effect, as many as one-third of the nation's small businesses will opt to drop their employee coverage.

"This is very good for small business," Dean said. "There was a McKinsey study, which the Democrats don't like, but I do, and I think it's true. Most small businesses are not going to be in the health insurance business anymore after this thing goes into effect."

The study pointed out that one of Obama's key promises - that employees would be able to keep their employer-provided insurance plans - won't be true for employees of about 45 percent of small businesses, because those same businesses are planning to drop employee coverage because it'll be cheaper for them to do so.

Which leads to the second of Obama's two main promises - that his healthcare reform measure won't add to the nation's deficit.

As it turns out, employees who are tossed off their employer's plans will then be eligible to sign up for one of those government (read taxpayer) provided health insurance exchange pools. And that, as they say, is where the real money is.

Regarding Dean's comment that dropping employee coverage would help small businesses, former New York Gov. George Pataki said, "The only way it's a help is if they drop coverage and their employees would all of a sudden have to go on the exchange, which is what of course the president promised wouldn't happen."

Most estimates of the healthcare reform bill is that it would cost about $970 billion over 10 years, about half of which would be paid for in new taxes. But that was based on a relatively small amount of employees - something like 7 percent, according to Congressional Budget Office estimates - being moved off their employer-provided coverage and into the exchange pools.

But with millions more employees likely to wind up in the exchange, that is liable to add nearly $1 trillion more to the cost of "reform."

Wasn't Obamacare supposed to reduce costs?