Steamboat Institute Co-Signs an Open Letter on Health Spending Provisions in Covid Relief Bill

February 22, 2021

The Steamboat Institute co-signed an open letter warning of the many problems with the health spending provisions in the Covid-19 relief bill currently being considered by Congress. Read the open letter below. ***

The New Push to Expand Government’s Role in Health Care Won’t Work. Here’s How We Can Help Americans Instead.

Democrats in Congress have proposed a COVID-19 relief bill that includes provisions to dramatically increase government subsidies for health coverage for millions of people who already have insurance while further expanding government control over health care.

Among many other provisions, the legislation would increase government payments to insurance companies via the Affordable Care Act by:

Most of the spending on premium subsidies will be paid to insurers on behalf of people who already have coverage. The bill would subsidize 85% of premiums for employees to continue COBRA coverage through September. It also gives states that have not expanded Medicaid to cover able-bodied adults a five-percentage-point increase in federal matching funds for traditional Medicaid recipients for two years if they expand their programs.

It also would draw employees away from their job-based health insurance into the exchanges, where they would have inferior coverage.

Instead of addressing Obamacare’s many flaws and costly mandates, the Democrats’ misguided proposal simply throws more money at insurance companies each time they increase premiums.

According to the Congressional Budget Office, these provisions would increase the deficit by tens of billions of dollars over the next two years and will fuel health care cost inflation without substantially expanding coverage.

Despite projections that millions of people would lose their employer-based health coverage due to COVID-19, a Heritage Foundation analysis of actual insurance market enrollment data for the first three quarters of 2020 found that the economic dislocation caused by COVID-19 did not appear to have had a significant adverse effect on health insurance coverage. The study concluded that “health insurance enrollment has remained fairly stable this year.”

Furthermore, the COVID-19 relief legislation that Congress passed in March 2020 already enhanced federal Medicaid funding, required states to continue covering current Medicaid recipients, and specified that additional unemployment compensation payments were not to be counted as income for purposes of determining Medicaid or Children’s Health Insurance Program eligibility. Consequently, Medicaid and CHIP enrollment ballooned from 70.9 million individuals in March 2020 to 77.3 million in September (the most recent month for which figures are available).

Rather than the mistargeted and wasteful spending in the proposed legislation that papers over the failures of government-run health care, Congress should pursue policies that reduce health costs and expand access to care and health care choices by eliminating cost-increasing government mandates and unleashing the power of innovation and competition.

We have developed policies to do just that, a plan estimated to lower premiums by up to a quarter and expand enrollment in private plans—all without spending one dime of federal taxpayer dollars. Such an approach succeeds because it empowers and protects individuals and families—rather than insurance companies and big government.

We would be happy to work with Congress to advance these solutions to address the problems facing Americans in health care today.


Marie Fishpaw, The Heritage Foundation

Grace Marie Turner, Galen Institute

Joseph Antos, PhD, American Enterprise Institute

Doug Badger, The Heritage Foundation and Galen Institute

Brian Blase, PhD, Galen Institute

Stephen T. Parente, PhD, University of Minnesota

Richard E. Ralston, Americans for Free Choice in Medicine

Sal Nuzzo, The James Madison Institute

Lee S. Gross, MD, Docs 4 Patient Care Foundation

Dave Hoppe, Hoppe Strategies

Ed Haislmaier, The Heritage Foundation

Senator Beverly Gossage, Kansas State District 9

Robin T. Smith, TN Representative, HD26

Steven White, M.D., Catholic Medical Association

Bob Carlstrom, Association of Mature American Citizens (AMAC)

Jennifer Schubert-Akin, The Steamboat Institute

Lisa B. Nelson, ALEC

James L. Martin, 60 Plus Association

Saulius “Saul” Anuzis, 60 Plus Association

Mary Mahoney, 60 Plus Association

Grover Norquist, Americans for Tax Reform

Andy Mangione, AMAC Action

Rick Santorum, Former U.S. Senator, Pennsylvania

Thomas Schatz, Citizens Against Government Waste

Elizabeth Wright, Citizens Against Government Waste

Mike Stenhouse, Rhode Island Center for Freedom and Prosperity

Preston Noell III, Tradition, Family, Property, Inc.

James Taylor, The Heartland Institute

Aaron Stover, The Heartland Institute

Michael S. Parker, Catholic Medical Association

David J. Theroux, Independent Institute

Graham H. Walker, Ph.D., Independent Institute

Nina Owcharenko Schaefer, The Heritage Foundation

Robert E. Moffit, Ph.D, The Heritage Foundation

Bethany Marcum, Alaska Policy Forum

Jessica Anderson, Heritage Action for America

Newt Gingrich, Former Speaker of the House of Representatives

Joe DeSantis, Gingrich360

Robin Walker, Foundation for Government Accountability

Paul Gessing, Rio Grande Foundation

Beth Haynes, Galen Institute

Marilyn Singleton, American Association of Pharmaceutical Scientists

Roger Stark, Washington Policy Center

Ronald E. Bachman, President & CEO Healthcare Visions

Jeff Kanter, Freedom Hub Health

David Wilson, Wilson Partners

Merrill Matthews, Institute for Policy Innovation

Sen. Bryce E. Reeves, Virginia Republican Minority Whip

William F. Shughart II, Independent Institute

David E. Wilson, Wilson Partners

Rep. Eric M. Redman, Former Idaho State Representative

AnneMarie Schieber, The Heartland Institute

Elizabeth Stelle, Commonwealth Foundation

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