Thursday, October 13, 2011
Higher premiums signal flawed health-care reform
The promises of the U.S. President’s health-care law continue to unravel as the costs of its harmful mandates become more and more apparent. The latest study by the nonpartisan Kaiser Family Foundation reveals that premiums for employer-backed insurance have jumped dramatically this year – by 8 percent for individuals and 9 percent for families.
During his campaign, President Obama assured voters that he would reduce the cost of health-care premiums by an average of $2,500 per family. Instead, premiums have grown by nearly that much since he was elected – at a rate that far exceeds wage increases and inflation.
The gap between rhetoric and reality has not changed. The President recently proposed paying for a portion of his new $447 billion jobs bill by altering Medicare’s prescription drug program. Douglas Holtz-Eakin, former director of the Congressional Budget Office, says the changes would increase drug costs and push up monthly premiums by as much as 40 percent for millions of seniors.
More Cost, Less Coverage
According to Kaiser President Drew Altman, the study illustrates “a quiet revolution going on in what we call health insurance in this country.” He says insurance is becoming less comprehensive and is likely to stay that way.
The president made a pledge to Americans that they could keep their current health-care plans, but this promise is no longer viable. The higher costs triggered by onerous mandates have eroded the options available. Kaiser’s report shows that only about half of the workers surveyed had the same insurance as they did before the health-care plan became law. Of course, estimates done by the Obama Administration did not foresee such an accelerated change.
Americans are right to be concerned about having to pay more for health care. These rising premiums are particularly painful and far-reaching in a weak economy. For the first time, half of workers at small firms have annual deductibles topping $1,000 on individual policies.
The changing landscape extends to employers’ role as an insurance provider. About half of Americans currently get their insurance from employer-backed health-care plans. This year’s surging costs present employers with tough options: Shift more of the burden to workers or drop coverage altogether. More small businesses – the prime drivers of job creation – are choosing the latter. Those that shoulder the rising costs may be too cash-strapped to hire or expand. The result is lost economic competitiveness, bigger government, and a greater strain on taxpayers.
Need for a New Approach
I voted against the president’s health-care bill last year, and I voted to repeal the law this year. The evidence continues to mount that we need a new approach – one that offers practical, cost-efficient solutions driven by market competition.
Provisions such as the law’s financially unsustainable Community Living Assistance Services and Supports Program, or “CLASS Act,” have been deemed unworkable even by the administration.
President Obama’s policymakers have already granted more than a thousand waivers to states, labor unions, and companies because the new rules are too costly to bear. The Supreme Court is likely to get involved within the next year regarding the law’s constitutionality.
Rising premiums are one of many indicators that the president’s health-care plan is taking us in the wrong direction.
Instead of continuing to implement the flawed law, we should work to give Americans the affordable, high-quality health care they deserve.
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