Since the topic of 'healthcare reform' has emerged, the Obama administration has continued to make the silly assertion that Obamacare will not lead to a decline in private health insurance. Unfortunately, when one reads the fine print the truth is often far different that the rhetoric. In the healthcare bill are many proposals that will lead to the demise of private health insurance and to a total takeover of the our healthcare by federal bureaucrats.

In medicine or any other industry there are many ways to beat out a competitor. Most successful businesses that operate under free market conditions are able to lure customers by producing a better product at a lower price than their competitors. In the case of private health insurance various health insurance providers compete to provide a more attractive benefit plan at the lowest possible price. As the number of benefits increase so naturally the costs of the insurance plan increase to the consumer. Because of this there are fewer customers that can afford the so-called 'gold-plated' insurance that covers almost everything.

So what does the Obamacare plan propose to do with private health insurance?

In the bill is detailed a plan to tax the so-called 'gold-plated' insurance in order to help pay for covering the uninsured. It doesn't stop there though, the Obama administration's end game is to end the employer tax break for providing health insurance to their employees. If the tax break is repealed, this will in effect raise the cost of all private health insurance and not just the 'gold-plated' insurance. As the price increases so will there be correspondingly fewer and fewer people able to pay for such health care. The end result will be an increasing percentage of people turning to the 'free' government option.

According to President Obama, this proposal is also designed to slow down the increase in cost of medicine by introducing rationing. This will happen because 'gold-plated' plans that have more options will become prohibitively expensive with the added Obama tax. This will effectively bankrupt these plans and therefore only plans that offer few choices will survive. This will indirectly lead to fewer options or rationing.

As Mark Trumbell puts it in his article, Obama's healthcare tax plan: How risky?:

The stick is a tax on higher-end health insurance plans. This would give the government some revenue to help pay for its tax-credit subsidies. And by making gold-plated insurance coverage more expensive – and thus making customers think twice about buying it – it might restrain the runaway growth of healthcare spending in the US.

“This modest change could help hold down the cost of healthcare for all of us in the long run,” Mr. Obama said in his speech to Congress Wednesday.

Whether you agree with government rationing of care or not it is important that we as people understand the truth about our healthcare. Obamacare will lead to a system where all but the upper class will be forced into the government health system.