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Ryan: Fiscal Commission Proposal Would Accelerate ObamaCare

By on 12.1.10 | 2:01PM

President Obama's fiscal commission was tasked with trying to get deficits under control, but its proposals would dramatically accelerate the growth of the new entitlement program created by the national health care law, thus expanding America's future obligations, says Rep. Paul Ryan, a member of the commission and the incoming chair of the House Budget Committee.

Among the many proposals contained in the 66-page report, one of them would begin to phase out the tax exclusion for employer-based health insurance. While supporters of a free market for health care have long argued that such a step would be necessary to create a functioning market for insurance, Ryan argues that doing so with ObamaCare still intact would have disasterous ramifications. In the world of ObamaCare, Ryan explains, when employers begin to drop insurance coverage in response to the change in tax treatment, instead of going into a competitive free market, Americans will be funnelled into the government-run insurance exchanges. This would hasten the nation's long-term slide into a single-payer health care system.

"While I'm pleased to see the need to address the exclusion in the context of the Fiscal Commission, I have serious concerns with the consequences if applied under Obamacare's infrastructure," Ryan wrote in a email to TAS. "Without a healthy, vibrant, competitive market for health insurance, the proposed reforms would move employees away from job-based health insurance, and end up in the government-controlled exchanges. This would dramatically increase entitlement spending as hundreds of millions of Americans would be dumped into the subsidized exchanges. It would also result in more people being forced into the new health entitlement, at a time when we have no plan to finance our existing entitlement programs."

Read Ryan's full statement below.

"We must tackle the tax treatment of health insurance, which discriminates against those without job-based health benefits and inflates the cost of coverage. I've put forward proposals to replace the current exclusion and reroute that revenue into refundable tax credits for everyone, ensuring that those who are self-employed or unemployed receive the same tax benefit as those with job-based insurance. This reform - which I've put forward in several legislative proposals over the years - would delink health insurance from the workplace and attach the benefit to the individual. It is a critical step toward to promoting consumer-directed health care, a stark contrast to the government-centric approach in the President's new health care law.

"While I'm pleased to see the need to address the exclusion in the context of the Fiscal Commission, I have serious concerns with the consequences if applied under Obamacare's infrastructure. Without a healthy, vibrant, competitive market for health insurance, the proposed reforms would move employees away from job-based health insurance, and end up in the government-controlled exchanges. This would dramatically increase entitlement spending as hundreds of millions of Americans would be dumped into the subsidized exchanges. It would also result in more people being forced into the new health entitlement, at a time when we have no plan to finance our existing entitlement programs.

"I cannot overstate my respect for, and gratitude to, Erskine Bowles and Alan Simpson for their leadership as Co-Chairs of the Fiscal Commission. Tasked with an extraordinarily difficult challenge, they put forth a comprehensive and provocative proposal to help tackle the debt threat, advancing a sorely needed debate on these critical issues. The Co-Chairs modified proposal is a serious and credible plan. While I will continue to review their modified proposal, I have expressed serious concerns with several specific aspects of the plan - most notably the increase in taxes and the lack of structural reform to health care. Regardless of the outcome of Friday's vote, the proposal and the commission have already successfully launched the critically important debate facing this country: how to get the Federal government's fiscal house in order and ensure a prosperous future for coming generations of Americans."

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