As a follow-up to my blog posting on July 16 regarding the cost of Massachusetts new "Connector" government health care mandate, the Wall Street Journal published an insightful editorial today. Here are some key points:
- Gov. Deval Patrick (D) wheeled out a new $129 million tax plan to make up for the revenue shortfall and "budget gaskets are blowing out everywhere!" The Governor has already bumped up this year's spending to $869 million, $144 million over its original estimate.
- Most of the growth in health care costs in Massachusetts "Connector" coverage has come from "Commonwealth Care." This is subsidized insurance to those under 300% of the poverty level or family of four income under $63,000 a year.
From the WSJ Editorial: "This is a textbook example of how business taxes evolve into "pay or pay," (Emphasis added) the first recourse of state-funded health systems. Politicians love levies on business because they disguise the overall bill from voters. But such taxes are merely passed along to workers in the form of reduced take-home pay, since all health costs are part of compensation."
In short, there is no free lunch. As the mechanic in the FRAM oil filter television commercial points out: "You can either pay me now or pay me later." The point is when the engine in your car blows out because you haven't budgeted the costs of regular maintenance, the price tag for a major overhaul is so much more expensive. Try multiplying it by billions and with all of the other programs state legislators and members of Congress want to fund, you have to wonder where the money will come from and how much families and employers can afford!
Do the Math before acting.
Don C. Brunell, President (DonB@awb.org)
