A Families USA report argues that families would be worse off under presidential candidate, Mitt Romney’s health proposal than the health reform law signed by president Obama.
Although both ObamaCare and RomneyCandidateCare provide help with health insurance premiums through the federal tax system, the former does it through tax credits and the latter through tax deductions. As a result, not only does ObamaCare provide help to more than twice as many people, but the average amount of help provided to each person is also much larger.
The report ignores several important factors. Nearly half of the people ObamaCare is supposed to cover will be enrolled in the Medicaid program. Past research by Obama health advisors, Jon Gruber and David Cutler, have found that half to three-quarters of newly enrolled, Medicaid enrollees were previously insured with private coverage — often this is because employers dropped the employee health plan knowing Medicaid would pick up the slack. Studies have found Medicaid coverage is inferior to private coverage.
In addition, some of the low-income families that may benefit from tax credits may also find themselves without a job. The Patient Protection and Affordable Care Act also fines employers above a certain size who do not offer health coverage. Economists know that the cost of employee health plans comes out of workers’ pay. Workers who earn too little to offset the cost of mandated coverage will likely be priced out of a job.