I&I Editorial

‘If you like your health care plan, your employer-based plan, you can keep it. If in fact you have private insurance, you can keep it,” said Joe Biden in Iowa on Monday as he unveiled his plan to turbocharge Obamacare.

Wait, have we heard this before? Oh, right, it was President Obama pitching the original version of Obamacare, with a lie so egregious PolitiFact named it “Lie of the Year.”

Biden’s lie is worse, since his Obamacare 2.0 would result in tens of millions forced off employer plans they like and into the Obamacare exchanges, where the only choice would soon be government-run Medicare-style insurance. The only difference between Biden’s proposal and the more openly radical “Medicare for All” scheme is that Biden’s would take a little longer to get to single payer .

Two elements of Biden’s plan, in particular, ensure this end result.

The first piece is the former vice president’s plan to extend Obamacare’s subsidies to everyone, regardless of income. As it stands, Obamacare’s premium subsidies phase out as income rises, and disappear entirely once a family’s income hits 400% of the poverty level.

To sweeten the deal, Biden would set the maximum anyone could pay for insurance on the individual market at 8.5% of their income, down from 9.86%. What’s more, he’d base the subsidies on the cost of “gold” plans, which offer much lower out-of-pocket costs than the current benchmark “silver” plans, and as a result, have higher premiums.

So Biden’s offer is more generous health care for everyone in the individual market at lower costs.

Imagine how employers will respond to this landscape. Most will cancel their health benefits entirely and shift workers over to the Obamacare exchanges, knowing their employees can get gold-plated coverage while shifting $750 billion in subsidy costs onto federal taxpayers.

When Obamacare’s architects designed the subsidy scheme for the individual market, they knew it would cause many employers to shuffle workers onto Obamacare. At one point, the Congressional Budget Office figured that, even with the skimpier subsidies, Obamacare would push 10 million people off their employer plans.

So, instead of outlawing employer-provided insurance outright, which Medicare for All does, Biden would simply subsidize it out of existence.

The second key piece of Biden’s single-payer-on-the-installment-plan scheme is his promise to offer a “public option” to anyone in the individual market that is “like Medicare.” Biden doesn’t offer any details, except that the government will “negotiate” better rates with providers.

However it’s put together, the public option would be able to undercut any private insurance on price, if only because the government doesn’t have to negotiate, it can force providers to accept discounted payments. Medicare today pays providers only about 40% of what private insurers pay.

Washington state, the first to approve a public option for residents, initially wanted to set payments at Medicare rates, which would have let it underprice private insurers by a huge margin. Even after officials decided that the state-run public option would reimburse providers somewhat more than Medicare, they still figured they could undercut private insurance by as much as 10%,

The left tried desperately to get a public option into the original Obamacare because Democrats knew that it would drive private insurance out of business, leaving the public option as the only alternative. The system didn’t succeed because moderate Democrats (who are pretty much all gone from the party now) were able to block it.

Combine these two features of Biden’s plan and here’s what you get: Tens of millions of workers shoved into the Obamacare exchanges, where soon enough the only “option” would be a government-run insurance plan.

The fact that this is now considered a “moderate” health care proposal shows just how far left the Democratic Party has moved in recent years.

The fact that Biden thinks he can sell the “keep your plan” lie a second time shows just how gullible he thinks the American public is.

— Written by John Merline

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