Obamacare Creates Windfall for Drug Companies

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Obamacare Creates Windfall for Drug Companies

Posted by Dr. Mercola | April 22

2010 | 20,437 views

 

 

 

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http://articles.mercola.com/sites/articles/archive/2010/04/22/obamacare-creates-windfall-for-drug-companies.aspx

 

 

 

 

 

The

healthcare bill may soon be creating even more profits for the

pharmaceutical companies, thanks to a change in the tax code that

affects flexible spending accounts (FSA) or health savings accounts

(HSA).

Consumers can use these pre-tax accounts to pay for eligible health

care expenses -- expenses that used to include over-the-counter

medications. Under the new healthcare bill, however, only prescribed

medications will be covered. As written in Newsmax:

 

“ … Section 9004 of the Senate bill the House … as well as

Section 531 of the House bill that passed in November, changes the tax

code so that “distribution for medicine” from HSAs and FSAs are

“qualified only if for prescribed drug or insulin.”

Yes, the bills are merciful enough to allow diabetics to

purchase insulin under these tax plans, but if you or your family

members need Pedialyte, prenatal vitamins, or numerous other OTC health

items, you will see a tax hike that could be huge.

Since HSAs and FSA contributions are exempt from both income

taxes and 15.3 percent payroll tax for Social Security and Medicare,

and since these together can reach more than 40 percent of an

employee’s salary, the effective tax increase on these medicines could

be more than 40 percent.

And this tax change will almost certainly cost the healthcare

system billions more dollars in unnecessary spending both to the

government and private insurance plans.”

 

This is only one aspect of the healthcare bill that could end up

costing the government more money. According to Robert J. Samuelson in

the Washington Post, the plan may also trigger a budget

crisis. He writes:

 

“Two weeks before the House vote, the Congressional Budget

Office released its estimate of Obama's budget, including its

health-care program. From 2011 to 2020, the cumulative deficit is

almost $10 trillion. Adding 2009 and 2010, the total rises to $12.7

trillion.

In 2020, the projected annual deficit is $1.25 trillion, equal

to 5.6 percent of the economy (gross domestic product). That assumes

economic recovery, with unemployment at 5 percent. Spending is almost

30 percent higher than taxes. Total debt held by the public rises from

40 percent of GDP in 2008 to 90 percent in 2020, close to its

post-World War II peak.”

 

 

Sources:

Washington

Post March 29, 2010

 

Newsmax

March 23, 2010

 

 

 

 

 

 

 

Dr.

Mercola's Comments:

 

 

 

 

 

 

 

 

 

 

The “Affordable Health Care for America Act” could cost the U.S. nearly $2 trillion over the next 10 years. When

added into the Congressional Budget Office’s latest budget estimates

from 2009 to 2020, the total budget rises to $12.7 trillion!

So what exactly is “affordable” about that? You may have heard

reports that the new health care bill will actually reduce the deficit

by $143 billion over the next 10 years.

Even if this is true, it is still only a fraction of the overall

costs of the plan, and, as the Washington Post reported,

amounts to only “about 1 percent of the projected $12.7 trillion

deficit from 2009 to 2020.”

So what is all of this spending going to get you? What will it

mean for your health and that of your family?

 

Who Will Benefit from the New Health Care Bill?

 

Will all of this spending result in stellar health for every U.S.

citizen? Unfortunately not. The United States already has the most

expensive health care system in the world,

The U.S. spends more than twice as much on each person for health

care as most other industrialized countries. And yet it has fallen to last place among those countries in

preventing avoidable deaths through use of timely and effective

medical care.

That the system is fatally flawed and in need of a radical

overhaul is self-evident, but now, written into the new health care

bill, are subtle changes that will end up costing taxpayers even more

money, all while encouraging the use of expensive and dangerous

prescription drugs.

How?

Since over-the-counter medications are no longer qualified items

for HSAs and FSAs, it will actually be less expensive for many people

to see a doctor and be prescribed a drug then it would be to purchase a

drug over-the-counter.

John Berlau said it well in Newsmax:

 

“OTC drugs are much cheaper [than] those available for

prescription, but they could now be more expensive to individual

consumers given that prescription drugs would still be eligible for

favored treatment in the tax plans, and that insurance companies would

be mandated to cover many of them.

Consequently, any time a consumer has the slightest

headache, the financial incentive would often be to see a doctor and

get a prescription rather than go to the store and get medicine off the

shelf.

This could mean that billions will be wasted on the

additional costs for prescription drugs in instances when OTC medicines

could be just as safe and effective at treating the illness.”

 

 

Drug Companies Will Get Richer

 

There should be no doubt about the power the drug industry wields

in shaping the US health care system, and they undoubtedly made sure

the new plan would continue to shower them in profits.

Big pharma has been the driving force behind conventional

medicine, and the beneficiaries of exploding health care costs, for

well over a century, and there are no signs that the current health

care reform will change any of this.

On the contrary, this new legislations is specifically designed to

continue to feed the beast.

The new health care bill actually provides incentives for people

to purchase more expensive prescription drugs in favor of their less

expensive over-the-counter cousins.

 

What is Missing From the Health Care Reform Bill?

 

Drug companies, by and large, are not here to bring health to the

population but to scam them on one level for vast amounts of money, by

treating the symptoms and not addressing the cause.

And a health care system that continues to buy into this

methodology, which focuses on drugs and surgical interventions instead

of valuing your body’s innate ability to heal when given proper

nutrition and a healthy lifestyle, will ultimately fail you.

Where, instead, is the debate about limiting unnecessary,

ineffective treatments and stopping fraud? Why is no one talking about

the fact that there are effective, inexpensive natural-based

alternatives?

These are the discussions that could actually make Americans’

healthier … but the fact of the matter is that the Big Pharma Cartel

has a supreme hold over our government, and this is, most likely, why

you do not see any discussions about these very real, underlying

problems -- and why the drug companies, not you or your family’s

health, will be the primary beneficiaries of the new health care reform.

As long as your focus is on drugs and surgical interventions, you

will never see the fundamental changes that are so desperately needed.

It can only be accomplished by a radical change in how you, and how

society as a whole, think about health.

And this change can only be accomplished one person at a time. The

goal is to have a critical mass of people refuse the unnecessarily

dangerous and counterproductive solutions currently offered by

conventional medicine. That will serve as the powerful stimulus to

generate authentic change in the system.

There are more than 1.5 million people who receive this

newsletter. We CAN make a huge difference. If only a small fraction of

you spread this message within your little community of family,

friends, and coworkers, just imagine what we can accomplish together.