The latest Romney campaign commercial, titled “Nothing’s Free,” returns to his favorite whipping post, “Obamacare.” It seems to have finally occurred to Romney that quite a few voters might think extending health insurance to more than 40 million Americans is a good thing. But Romney does not want to focus on the ugly side of his promise to repeal the Affordable Care Act (ACA)—that he would leave these citizens uninsured and potentially allow them die for lack of medical treatment. So instead he argues that the cost of insuring them is too high.
“Some think Obamacare is the same as free healthcare,” says the voiceover. “But nothing is free. Obama is raiding $716 billion from Medicare, changing the program forever. Taxing wheelchairs and pacemakers.” On the other hand, “The Romney/Ryan plan will restore Medicare funding, and protect and strengthen the program for the next generation.”
Each of these complaints is false. As the New York Times explains, the ACA did not actually take $716 billion out of what goes into Medicare, it took the money out of what Medicare pays to insurers and hospitals. Therefore, it actually improves Medicare’s fiscal health, which Romney would undermine by repealing the ACA. “The 2010 health care law cut Medicare reimbursements to hospitals and insurers, not benefits for older Americans, by that amount over the coming decade,” writes the Times’s Jackie Calmes. “But repealing the savings, policy analysts say, would hasten the insolvency of Medicare by eight years—to 2016, the final year of the next presidential term, from 2024.”
The ad also gives you the incorrect impression that the ACA is detrimental for people with disabilities. Nothing could be further from the truth. Disability rights advocates have vociferously supported its passage and implementation.
As for taxing wheelchairs and pacemakers, that claim is misleading. The ACA will impose a 2.3 percent excise tax on medical devices. But remember, thanks to the ACA, everyone will have health insurance, so necessary devices such as wheelchairs and pacemakers will be covered. That means the tax will not directly be paid by consumers, but rather—to the extent the manufacturers can pass the cost on rather than accepting lower profit margins—by the insurance companies. Some of that in turn finds its way into higher premiums, but very little. The Center on Budget and Policy Priorities found, “The effect of the excise tax on consumers’ costs for health care and health insurance will be minimal and will be swamped by other factors. Spending on taxable medical devices represents less than 1 percent of total personal health expenditures, so a small increase in their price would have an almost imperceptible effect on health insurance premiums. Device manufacturers generally do not hold enough market power to pass on the entire excise tax to consumers through higher prices.”