The Affordable Care Act was bad legislation, in part because it depended on plenty of imaginary budget savings.
“This is a coverage bill, not a cost reduction bill,” top Senate staffer David Bowen said to a K Street audience after the bill passed. Bowen said that Senate Democrats had decided to do the same thing Massachusetts had done: “do coverage first, knowing that that would bring on a cost battle second.”
But since the passage of Obamacare, the cost-controls and offsets have one-by-one been stripped out.
First, Democrats killed the ill-conceived long-term-care-insurance measure, known as the CLASS Act. This provision, which provided government insurance for long-term care, was, amazingly, booked as reducing the deficit. This was ridiculous, and after the bill passed, Democrats realized it was a disaster, and the administration has suspended its implementation. [NOTE: An earlier version of this post incorrectly stated that Democrats had repealed the provision.]
Another reason the bill was supposed to “reduce the deficit” was an unusually onerous tax hike on small businesses. The provision, known as the “1099 provision” would have forced small businesses to file all sorts of new paperwork for all sorts of transactions (sell a digital camera, file a 1099), in the hope of picking up transactions that are taxable. Congress also repealed that provision.