The Affordable Care Act, commonly known as “Obamacare,” is being praised by supporters as the signature domestic policy achievement of President Obama’s first term.  Indeed, it has some benefits, the foremost of which is that it extends healthcare coverage to everyone.  Its pros and cons have been debated endlessly, and I do not wish to repeat them here.

However, as I predicted in an earlier blog posting, there will be some unintended consequences to Obamacare, of which most people are unaware, which will have an adverse affect on most Americans.  Ironically, many of those most affected will be the very people who supported the law, in particular, and President Obama, in general.  Those would be the lower middle working class, African Americans, Hispanics, single women and young people.  As I said in another earlier blog, “Be careful what you wish for.”

The key date is January 1, 2014.  That is when Obamacare becomes fully effective.  Some of the adverse unintended consequences are as follows:

1.    Obamacare requires employers with 50 or more full time employees to provide those employees with the government-designed health plan or else pay a fine.  The problem is the cost of the insurance will likely add nearly $2.00/hour to the employer’s cost of each employee.  This is a significant additional expense for lower paid employees.  Therefore, employers may decide it is cheaper to either lay them off or, at least, cut their hours to part time status.  A preponderance of those affected will be people in the above-mentioned groups. For example, the CEO of Papa John’s Pizzas has already stated that the company is likely to reduce the hours of some employees.  Others will likely follow, particularly small businesses

2.  Companies may find it cost effective to outsource many functions utilizing agencies that specialize in providing temporary or part time employees.  These would be predominantly clerical, warehouse or stock room jobs. Workers of these agencies do not qualify for health benefits.

3.   A chain of Florida restaurants is considering adding a 5% surcharge to its customers’ bills to pay for Obamacare costs.  This is an interesting idea, a kind of “consumption tax,” that may catch on.  This would be a regressive tax that, once again, would affect Mr. Obama’s constituency disproportionally.

4.   Workers who lose their coverage will be required to purchase coverage.   Many would not be able to afford it.

5.   There will likely be cuts to Medicare funding to help pay for Obamacare.  If so, this will impact the quality of health care to seniors.  Hospitals and nursing homes may have to reduce personnel, further exacerbating this problem.

6.   Technically, the law empowers the Secretary of Health and Human Services to wield some influence over a doctor’s medical decisions, even if the patient is paying privately.  The many ramifications of this are obvious, none of them good.

7.   Finally, as I mentioned in another of my blogs, there will be tax increases to help pay for Obamacare, and not just on the wealthy as you may have been led to believe.  Perhaps, the most egregious is a 3.8% tax on the profit from the sale of any asset, including your home, business or stocks.


1.   The 80% of Americans who already had health insurance will, in effect, be paying for the 20% who were previously not covered.  This payment will take the form of higher cost for health insurance, tax payments and/or lower quality of healthcare.  Thus, 80% of Americans will be worse off under Obamacare than they were before.  Eventually, they will figure that out.  At that point, the altruism of helping the disenfranchised 20% will fade.

2.   The medical profession will become less lucrative due to rising costs, such as malpractice insurance, resulting in a shortage of doctors in some locales and in some specialties.  Moreover, some top shelf doctors, who can get away with it, may cease accepting insurance, requiring payment upfront for services.  This trend has already begun.

3.  These unintended consequences will lead to disillusionment and displeasure with Obamacare and make it unpopular with most Americans.  As a result, it will become a major issue in the next election.


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