NCPA - National Center for Policy Analysis


October 13, 2009

The Senate Finance Committee bill written by Chairman Max Baucus (D-Mont.) (the Baucus bill) will drive up the cost of health insurance for all Americans and then force everyone to buy it or face tax penalties or jail time.  While the Baucus bill does cap out-of-pocket costs based on a person's income, the effect on American families is still staggering, says PricewaterhouseCoopers. 

Other findings:

  • For individuals making $34,140 (three times the Federal Poverty Level) the Baucus health care proposal could mandate up to $4,097 in annual premiums, a sum which could have been spent on over nine months of food, almost four months of housing or well over a year of utilities.
  • For a family of four making $69,480 (300 percent above poverty) the Baucus bill mandates annual health insurance premiums of $8,338, which would be worth the equivalent of over 10 months of food, four months of housing or almost two years of utilities.
  • For individuals earning $45,520 (400 percent above poverty) Baucus mandates $5,462 for health insurance, or over a year of food, four months of rent or a year and a half of utilities.
  • For families earning $92,640 (400 percent above poverty) Baucus mandates $11,117 in health premiums, the equivalent of over a year of food, five months of housing or two years of utilities.

Those numbers include the subsidies for health insurance in the Baucus bill.  To pay for all this new health care spending, plus the massive expansion of Medicaid, the Congressional Budget Office (CBO) estimates that the Baucus bill will collect $4 billion in fines from those who do not purchase insurance, $200 billion taxing health insurance companies with generous health plans, and $25 billion in taxes on employers.  Not to mention the billions in cuts to Medicare payments to hospitals which will result in significant cost shifting to consumers.

Instead of reducing the average family's health insurance premiums by $2,500 per year, as President Obama promised, the Baucus bill would actually raise them by $4,000 more than they would have been without reform.  The Baucus bill spends at least $1 trillion, fails to cover all Americans, taxes employers for creating jobs, and inflicts higher out-of-pocket health care costs on all Americans. 

Source: Report, "Potential Impact of Health Reform on the Cost of Private Health Insurance Coverage," PricewaterhouseCoopers, October 2009.

For report:


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