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Obamacare results in confusion, frustration, higher taxes and fees in TN

By   /   June 27, 2013  /   No Comments

By Chris Butler | Tennessee Watchdog

NASHVILLE — Some Tennesseans — and many Americans alike — have been worried over the costs associated with Obamacare, which the Supreme Court ruled constitutional one year ago.

Now, they will face those fears.

The Tennessee Comptroller’s Office reported in February, for example, that Obamacare will likely cost the state as much as $1.4 billion over the first five years of implementation.

Health insurance rates in Tennessee, meanwhile, are going up at least 50 percent, said Brenda Williams, spokeswoman for the Tennessee Medical Association, the state’s largest organization of physicians.

Additionally, some state residents have to realize their taxes will increase along with their health insurance costs.

Local governments, such as White County’s, are raising taxes so all county employees will have health insurance, said County Executive Herd Sullivan, who favors Obamacare.

Herd Sullivan

County officials must raise an additional $1 million per year so 400 of the county’s 700 employees can have health insurance. County officials are trying to decide whether to add a tax on automobiles, known as a wheel tax, or opt for higher property taxes, Sullivan said.

“The county employees deserve insurance. That’s my feeling on the matter, but our County Commission should have had health insurance for county employees years ago. They just couldn’t do it before because they just didn’t want to raise taxes. They didn’t want to do the right thing, but now this law is forcing them to.”

White County has a median household income of $35,000 per year, according to the 2010 U.S. Census, and Sullivan isn’t worried that higher taxes would hurt it.

Problems with business 

Meanwhile, as Tennessee Watchdog reported in February, Smith and Nephew, a medical device manufacturer in Memphis, laid off 100 employees in February; company officials blamed a 2.3 percent Medical Device Tax on  yearly sales.

Memphis is home to several companies that make medical devices, such as hip replacements and heart stints.

The industry contributes more than $5 billion per year to Tennessee’s economy, according to the Advanced Medical Technology Association.

“Tennessee has about 8,500 medical technology jobs in the state,” said AdvaMed spokeswoman Wanda Moebius.

“About 10 percent of those jobs could be at risk in this state because of this tax. Furthermore, jobs indirectly supported by the industry in the state total almost 26,000. Altogether, about 830 jobs could be at risk in Tennessee,” Moebius said.

Business owners forced to comply with Obamacare regulations have gotten no assurances from Tennessee Attorney General Bob Cooper, a Democrat, about pursuing a case on their behalf. If Cooper would pursue the case, as Oklahoma Attorney General Bob Pruitt, a Republican, is doing — and should Cooper win — business owners in Tennessee could be exempt from the rules.

According to Pruitt’s interpretation, states opting not to create their own health exchanges under

Chris Butler

Tennessee State Capitol

Obamacare, including Tennessee, Oklahoma and 31 others, don’t have to participate in the employer mandate, which levies a tax on businesses with 50 or more employees that fail to comply with provisions of the law.

‘Nobody knows what is going on’

Fewer than seven months before full implementation, doctors in Tennessee complain the federal government has given them little guidance on dealing with exchanges and the costs of various rules they must follow, Williams said.

“We are only a few months from outset of exchanges, and nobody knows what is going on.”

As Tennessee Watchdog reported last year, Obamacare has introduced a litany of costly entitlement programs, courtesy of a $15.1 million federal grant, through the Prevention and Public Health Fund.

The fund pays for, among other things, putty for Tennessee’s smokers to squeeze to control cravings, as well as breath mints. Williamson County, one of Tennessee’s most affluent areas, received $20,000 to fund a computer-based fitness program to test students’ aerobic abilities.

Tennessee Attorney General Bob Cooper

Tennessee Watchdog also reported the federal government gave Obamacare waivers to 23 state businesses and insurers and to 24 unions.

Workers for TennCare, which operates as Tennessee’s Medicaid program, are working to overhaul eligibility determination system before January, as it now fails to meet Obamacare guidelines, said TennCare spokeswoman Kelly Gunderson.

“This is a very ambitious timeline, which is compounded by the fact that states had to wait for federal guidance and regulation before they could begin creating new systems or updating current systems. More regulations are still anticipated,” Gunderson said.

“States are having to move forward on developing their systems without these critical final regulations and will have to adapt as more information is forthcoming.”

Contact Christopher Butler at chris@tennesseewatchdog.org

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Chris Butler is an investigative reporter for Watchdog.org based in Nashville. Contact him at chris@tennesseewatchdog.org and follow him on Facebook at "Chris-Butler-WriterJournalist" or on Twitter at cdbutler1204.

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