9/09/2010

Obama's federal Centers for Medicare and Medicaid Services predicts that Obamacare will raise costs

Their solution is just to put pressure on companies to lower prices. It is nice to know that the impact of the health care bill is "moderate," it is just that it is "moderate" in the wrong direction.

The health-care overhaul enacted last spring won't significantly change national health spending over the next decade compared with projections before the law was passed, according to government figures released Thursday.

The report by federal number-crunchers casts fresh doubt on Democrats' argument that the health-care law would curb the sharp increase in costs over the long term, the second setback this week for one of the party's biggest legislative achievements.

The Wall Street Journal reported Wednesday that insurance companies have proposed rate increases ranging from 1% to 9% nationwide that they attribute specifically to new health-law coverage mandates.

Democrats signaled they would ratchet up pressure on the companies. "Insurers are using the consumer protections in health reform as a cover for their own greed," said Rep. Pete Stark (D., Calif.), chairman of the House Ways and Means health subcommittee. . . .

Regardless of the health law, national health spending has been rising in recent years and economists expect that to continue. In February, the federal Centers for Medicare and Medicaid Services projected that overall national health spending would increase an average of 6.1% a year over the next decade.

The center's economists recalculated the numbers in light of the health bill and now project that the increase will average 6.3% a year, according to a report in the journal Health Affairs. Total U.S. health spending will reach $4.6 trillion by 2019, accounting for nearly one of every five U.S. dollars spent, the report says. . . .




After looking at those figures, note this:

Health insurers say they plan to raise premiums for some Americans as a direct result of the health overhaul in coming weeks, complicating Democrats' efforts to trumpet their signature achievement before the midterm elections.

Aetna Inc., some BlueCross BlueShield plans and other smaller carriers have asked for premium increases of between 1% and 9% to pay for extra benefits required under the law, according to filings with state regulators. . . .


Take an example. Out of pocket expenditures such as co-payments decline, but there is a reason that insurance companies have co-pays. Getting rid of them will raise costs as the insured are less careful about the health care that they buy. That raises costs.

UPDATE: Obama gives a lame explanation for why the costs have increased. 1) The uninsured aren't covered yet. 2) Covering people with health insurance was supposed to lower costs.

President Obama on Friday defended the Democrats' healthcare law, saying the enormous expansion of insurance coverage made an increase in healthcare spending inevitable.

"As a consequence of us getting 30 million additional people healthcare, at the margins that's going to increase our costs — we knew that," the president told reporters during a White House press conference.

"We didn't think that we were going to cover 30 million people for free."

Obama was responding to questions about new cost projections, crunched by economists at the Centers for Medicare and Medicaid Services (CMS), revealing the nation's healthcare spending, as a share of the economy, will be 0.3 percentage points higher in 2019 than estimated before the law was passed.

That CMS report, published Thursday in the journal Health Affairs, also revealed healthcare spending will grow by an average of 6.3 percent each year over the next decade, whereas pre-reform projections pegged annual growth at 6.1 percent.

Republicans have latched onto the figures as evidence that the new reform law has failed in one of its central purposes: to bend the health cost curve down to sustainable levels.

But Obama rejected those criticisms, arguing his pitch for reform included warning that the process would be a long one.

"I said at the time it wasn't going to happen tomorrow, it wasn't going to happen next year," Obama said. "It took us decades to get into a position where our health care costs were going up 6, 7, 10 percent a year. And so our goal is to slowly bring down those costs." . . .


During the campaign, Obama promised this:

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1 Comments:

Blogger Martin G. Schalz said...

90 percent of a solution to a problem is the correct identification of the problem itself. Obviously, the Omama team has failed miserably on the health care problem.

I am of the opinion that overwhelming rules and regulations, paperwork, and jumping through bureaucratic hoops adds a great deal of cost to one's medical bills. Not to mention the huge insurance premiums that Doctors must pay. All of the aforementioned not only created by legislators, but completely ignored by them as well.

9/11/2010 10:28 AM  

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