Obamacare Creates Windfall for Drug Companies

money, windfallThe 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.”

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.


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.