Obama’s health care reform has finally found its legs this week. I wouldn’t blame it if it now proceeded to make a quick dash for the exit to avoid the detractors baying for its blood.

Whilst the UN can’t get enough, many Americans have reacted to the recent amendments to health care policy with fear and loathing, understandable considering a large proportion of US citizens pride themselves on the “supposed” free market system which America has had for over 200 years.

In simple terms, the new legislation is first and foremost a revision of health insurance policy. At the moment, it is down to the American individual to sort out their own coverage. ObamaCare, however, will mandate that by 2014 everyone must obtain health insurance, in an attempt to help cover the majority of the 40-50 million Americans who cannot afford or just don’t want health insurance. Those who still refuse to get coverage face a 2.5% income fine or a fine of $695 (depending on which is higher).

There is good news, however. Those families and individuals with a low income will gain access to subsidies which will help them gain access to health insurance or the government-funded Medicaid program. Even if you have a pre-existing condition, you will not be able to be denied insurance.

A lot of press out there right now fails to detail where exactly the money for all this is coming from. Both those on the political left and right seem more eager to preach either sycophantic or doom-laden babble. With a projected cost of $938 billion over 10 years, a big chunk of change is going to have to come from somewhere. But where exactly?

  • Half ($455 billion or so) will be generated by reducing payments to hospitals and others that treat Medicare patients and those under other government health programs.
  • Wealthy Americans face a 0.9% increase on the Medicare hospital insurance tax, raising it to 2.35%. A new, 3.8% Medicare tax on unearned income i.e. interest, capital gains will also take effect for these same Americans – specifically, individuals who make $200,000+ a year and married couples who make more than $250,000. Both these taxes will raise an estimated $210 billion from its starting date of 2013 up until 2019.
  • Those on high-premium aka “Cadillac” insurance plans will have to pay a new excise tax. This will be 40% of premiums paid on plans that cost more than $27,500 annually for a family. Inactive until 2018.
  • Around $90 billion from fees on the health care industry, as drug and medical device manufacturers, and health insurers, stand to gain millions of customers they didn’t have before.
  • Customers of indoor tanning salons will pay a 10% tax.

Basically, ObamaCare likes taxes. (Everybody else hates those, right?) If we break it down further, we can see affluent Americans seem to be footing a lot of the bill – literally. I hope they are not the same people that like to roast themselves on a sunbed, otherwise they’ll be particularly miffed. A nice overview of the discussion on tanning beds, including mention of the 10% tax, comes from Newsy.com:

On a side note, it’s interesting that an average American’s view on the US health care reform correlates with their political affiliation. Perhaps they should just analyse it on its own merits and flaws, though this is hard when you are dealing with a document twice the length of War and Peace.

Personally, I think it’s the fundamental right of any government to provide accessible health care to everyone and believe that is what the Obama administration is trying to do.

How it will turn out is another matter.